The Leadership Pipeline: How to Build the Leadership-Powered Company. - Review - book review

HR Magazine, March, 2001

By Ram Charan, Stephen Drotter and James Noel

Jossey-Bass, 2001

242 pages, List Price: $28.50

ISBN: 0-7879-5172-2

To ensure a steady supply of leaders with the right skills in the right positions, knowledge-driven organizations need to develop a full leadership "pipeline." To do so, authors Ram Charan, Stephen Drotter and James Noel offer a concept based on the model created by HR advisor Walt Mahler, who helped design the succession process at General Electric.

Charan is a leadership coach and former faculty member of the Harvard Business School and the Kellogg School of Business at Northwestern University. Drotter is chief executive of Drotter Human Resources Inc. in Pennsylvania. Noel is an executive consultant and former vice president of executive development at Citibank.

The authors present an overview of six leadership "passages," or major events. The first passage, moving from managing oneself to managing others, can trip up many potential leaders because they are reluctant to move away from what they have been doing to become successful. Companies often ignore the second passage, from managing others to managing managers, which the authors deem critical to future success.

The third passage is that of becoming a functional manager who reports to multifunction general managers. Functional managers, say the authors, "need to become skilled at taking other functional concerns and needs into consideration." The fourth passage, to business manager, requires a major shift in skills, time applications and values: The manager is becoming more oriented to strategic, rather than operational, goals. The fifth passage, to group manager, requires four critical skill sets--evaluating strategy for capital allocation and deployment, development of business managers, portfolio strategy and assessment of core capabilities. The sixth passage, to enterprise manager, focuses more on value than skills. The leader must be a long-term, visionary thinker.

The book offers ways to diagnose problems in the pipeline, to identify possible candidates for the process, to clarify roles and create performance standards, and to identify potential pipeline failures. There are several examples of how organizations failed to react to the signs of potential problems. In one example, an executive promoted up two levels, from functional to group level, retained his functional thinking and values. Say the authors,

"He was operating out of a purely functional value system: Can we do it? This is different from the value system of a business manager: Should we do it? And it's quite different from the value system of a group executive: Which choice will give us the best result now and in the future?"