Succession planning and management and leadership potential identification and development features noticeably on the agenda of most if not all top managers. Succession planning and leadership potential identification development was a term reserved for the last wills and testaments of family owned companies, however, the application of this term has evolved to include companies whose purpose is to plan to replace a company’s top leadership. Presently, leadership potential identification and development is accepted as a corporate world best practice to replace leaders and critical employees at various levels of all types of organizations. It has therefore been converted into a mainstream organizational strategy to be executed by the human resource department of most organizations with a strong involvement of the company’s top management.
Identifying candidate for future leadership position is a trend that has gained momentum in recent years. This has been elicited by the recent occurring’s where organizations that have failed to have a succession plan in place that identifies and nurtures potential leaders to replace management have experienced a downward fall in their performance after top management have retired or abruptly resigned. This necessitated the need to have a niche of organization employees who have been identified, nurtured, prepared and developed to assume an organization’s leadership positions upon the retirement of current management.
This paper presents the key factors to take into consideration when identifying potential candidates for leadership positions within an organization and presents an assessment-based approach to identifying the best candidates for a particular leadership position. The paper will also evaluate three specific assessment instruments that are usually used to evaluate leadership potential, justifying the use of each assessment instrument for its intended purpose. The paper will finally conclude by presenting potential legal ramifications that may arise if Robinson Insurance Agency implements an assessment-based approach to identifying potential.
The Key Factors for Identifying Leadership Potential
There are various critical influences that increase the potential for organizational success. Among the most important forces is strong leadership, professionally capable and talented HR practitioners and the cooperation and commitment of all in achievingdesired outcomes and organizational goals and objectives. However, Daly(2012) identified strong leadership as well as a strong leadershipassessment plan and leadershipsuccession mechanism as the keys to ensuring that an organization is not only successful but also creates a continuously sustainable competitive advantage in a particular industry.
While natural leaders stand out and are easy to identify, those that have leadership potential is a more difficult process. Therefore, there arises a need to make every attempt to identify future leaders earlier in their careers. Realizing that it takes time to nurture and develop the next generation of leadership in an organization. Various researchers have identified different key factors and characteristics to look out for in a candidate when identifying a potential candidate for future leadership position in an organization.
Reynolds & Scott(2010) identified various key factors for identifying leadership potentials, broadly categorized into motivation variables, personality variables, cognitive skills, learning variables, leadership skills, , performance and other factors.
Personality variables as a key factor in identifying leadership potential involves evaluating candidates based on their interpersonal skills, dominance, sociability, maturity, resilience and resilience. Learning variables entail assessing a candidate based on their openness to feedback, adaptability, flexibility, learning orientation, and interest in learning. Leadership skills entail evaluating a candidate’s leadership capabilities in terms of managing and empowering people, developing others, influencing, inspiring, challenging the status quo and change management. Motivation variables involves appraising a candidate based on his or her orientation to results, risk taking, tenacity, aspiration, drive, energy, ambition, career drive and organizational commitment.The last key factors for identifying key factors for identifying leadership potential as identified by Reynolds & Scott(2010) is performance record. This involves evaluating a candidate’s performance track record and leadership experiences. Other key factors falling under the other variables category are the candidate’s technical knowledge and functional skills, business knowledge, mobility, diversity, as well as cultural fit with the organizations values and cultures.
On the other hand, Bérard(2013)identified six key factors for identifying leadership potential. These factors the author outlined as: cognitive complexity and capacity, which involves evaluating a candidates’ conceptual thinking, and strategic thinking, differentiating and integrating characteristics.Secondly, evaluating a candidates drive and achievement orientation, which entails evaluating thecandidates based on their propensity to jumpstart an initiative, a candidates perseverance of effort, consistency of interest, achievement and realization.Thirdly, evaluating a potential candidates’ learning orientation, which encompasses assessing an individual’s openness to feedback, continuous improvement and learning orientation. The remaining key factor for identifying leadership potential according to Bérard(2013) is evaluating an individuals personal and business ethics such as fairness, authenticity, honesty, integrity, personal and business ethics as well as trust; evaluating a candidate’s motivation to lead such as leadership emergence, self-efficacy, and value leading others; and finally, evaluating a potential candidate’s social and emotional complexity and capacity. This involves evaluating the candidate’s emotional intelligence, impersonal sensitivity and emotional resilience.
Organizations can use the identified standard key factors along with other key behavioral descriptors to determine and identify who of their high performer employees have the potential and capacity to perform at higher levels of responsibility.
An Assessment-Based Approach for Identifying Potential among the Managers at Robinson Insurance Agency
Identifying current staff for possible leadership positions within an organization is a critical step in ensuring that the values and identifying cultures of an organization continuously transition smoothly without a decrease in performance in an organization upon retirement of top management. Therefore, there arises a need for an approach that ensures the selection of candidates for future leadership positions satisfies the needs of the organization by ensuring the right candidate is picked.
Such an assessment-based approach will involve establishing pre-conceived eligibility criteria for the assessment. Once the criterion has been established, little or no deviation from these pre-determined criteria will be tolerated. Tenure with the organization, satisfactory performance rating and requisite amount of supervisory experience can be examples of selection criteria.The assessment will evaluate factors such as leadership promise, personal development orientations, mastery of complexity, and balance of values and results. This can be achieved through a combination of administration of particular recognized assessment instruments, on-job assessment, as well as a one-on-one interview with senior management of the organization.
An assessment approach would be based on a series of tests that would be determined by the management or the human resource department, and which would be crafted in a manner that ensures the candidate to be picked would be the candidate that best exemplifies the values and philosophy of the company. That is, the candidate would be one who demonstrates a commitment to the Client-First philosophy and shows commitment to the company’s customer-oriented values and practices.Therefore, to identify an appropriate approach, there will be a need to subject the candidates to a number of assessments. These assessments would aim at bringing out the true character of the candidate and in the process be able to evaluate whether they indeed, by nature reflect the values of the company, or they are as the president says give “lip-service”.
The approach would involve a combination of a variety of assessments. These can include: first, the use of contemporary assessment tests which have been customizedto the company’s requirement and which would enable the administrator correctly assess the candidate’s perception or attitude towards the company’s values and their ability to promote them when in a leadership position. A single multi-rater such as a 360-degree assessment approach can also be used to evaluate the competencies, impact and leadership potential for each candidate.This assessment would also include assessment ratings from peers, subordinates, other managers and appropriate stakeholders. Secondly, the assessment can include an on-the-job assessment where the potential candidate is posted on a company branch where they can be independently monitored by personnel from the HR department to assess how they relate with customers. This will enable an assessment to be conducted which will allow the Company to correctly assess whether the candidate exemplifies the values of the company. The third assessment would involve a one-on-one interview. This would allow the candidate to be questioned on various issues that would not have otherwise been captured by the other assessments as well as allow the candidate to clarify certain aspects of the assessment. The interview will also allow him or her to provide any other information that he or she would deem important for a positive review during the assessment.
However, it is worth noting that when identifying candidates for future leadership positions, it is almost as important to know what not to do, as it is to know what to do. Organizations intuitively look for some traits in future top executives that do not predict leadership success at all. Some of the pitfalls that are made by many organizations are usually founded on what the regard as good predictors of a candidates’ potential to be a leader. Some of the often misconceived poor predictors of leadership potential include: Good team players; operational stars; dynamic public speakers; and hungry for greater responsibility candidates. According to Sorcher and Brant (2004), “team players and those who excel operationally often make better seconds in command. Many a great public speaker lack the subtle one-on-one persuasive powers that a top leader needs. And shows of raw ambition may be more an indicator of ego than of leadership.”
Three Specific Assessment Instruments to Evaluate Leadership Potential
There are various instruments designed to measure and evaluate the leadership potential of individuals. These include: the DiSC instrument, ProfileXT assessment, the Keirsey Temperament Sorter personality questionnaire, 360-degree assessments, Hogan leadership assessment, Lominger assessment instrument, and Discovery Leadership Profile assessment tool, as well as The Denison Leadership Development Survey. However, this review will focus on evaluating three of the most widely used instruments. These areDiscovery Leadership Profile assessment tool, Hogan leadership assessment, and ProfileXT assessment.
The Discovery Leadership Profile is a 360-degree multi-rater leadership assessment tool that was developed by Discovery Learning. This assessment tool provides organizations with feedback on how their leaders and managers specific management practices are perceived by other employees as well as how they perceive themselves. That is, it gathers perspectives and opinions from the individual as well as from 17 selected raters on the subject of leadership performance and competencies that are considered fundamental for effective leadership. The raters include peers, bosses, direct reports and others.
The assessment tool is based on research that identified critical competencies crucial for effectual leadership at various levels.A candidate’s performance is assessed based on responses to 40 items divided into 10 categories. The aggregated responses of the raters are weighed against the candidate’s self-assessment in a color graph that distinctly highpoints the candidate’s leadership strengths and his developmental needs.The Discovery Leadership Profile assessment tool is designed and aimed at assisting a leadership candidate in implementing necessary and lasting behavior changes that are identified from the feedback from the feedback obtained from the assessment.
The Discovery Leadership Profile is employed to assist in a variety of needs. These include: to create a plan for addressing Leadership Development Needs; Compare self-perception to the perception of others; Benchmark individuals leadership performance; Enable leaders to learn how other, who are important to their success see their leadership performance; Establish a common model for leadership effectiveness; and formulate a collective framework among organizational leaders of the leadership competencies and abilities that are fundamental for success in an organization; and finally Spot the strong point and developmental needs of management in various categories which have been identified as fundamental for effective leadership.
The Discovery Leadership Profile assessment tool is relatively cheap and affordable, priced at $150. The product includes an option of up to 5 custom open-ended questions and is available only online in three languages; Spanish, French and English.
The Hogan leadership Assessment is a test instrument and measure of normal personality used to predict job performance, allow organizations to fine-tune employee selection, promote leadership development, succession management and talent management processes. It is a proven assessment tool and is regarded as the first inventory of ‘normal’ personality based on the big five personality traits. It makes use of 11 personality scales to assist organizationsidentify their weaknesses, maximize strong points, and build successful teams. It measures an individual’s tendencies when under stress and aims at answering the question: “what tendencies could derail this individual’s career or performance?” The tool includes 168 true/false questions that take in the region of 10 to 15 minutes to complete, and is available in multiple languages.
The tests aims at identifying characteristics and aspects of behavior not detected in an interview. It pinpoints characteristics and tendencies that might lead to career derailment, identifies tendencies that impeded work relationships and hinder productivity, and identifies factors relevant to a candidate strategic self-awareness. The tool also identifies how a candidate is likely to act in various circumstances and notes their shortcomings and strengths.It providesa psychometric evaluation of personality characteristics that distinguish personalities and determine career success (Berard, 2013). It has been found to be one of the best assessments of personality tool that is key for evaluating candidates for leadership positions.
The Hogan leadership forecast is not a pass/fail psychometric test. It provides organizations with an in-depth evaluation of their leadership potential and what could possibly derail them. The leadership forecast technique is unique because it links the manager’s evaluation to proven learning and development recommendations. This assessment instrument explores management behaviors from three unique perspectives: the bright side; the dark side; and the inside.
The profile XT is a psychometric instrument whose roots extend over the past 25 years. It was developed by Profiles International.It is a commercially available and all-purpose assessment tool designed to test the match of a candidate’s thinking and reasoning styles, behavioral traits and occupational interests to successful company employees(Adler, 2012). That is, it measures thinking style, behavioral traits and occupational interests-factors that help assure “job fit.” It is a combination of personal style and cognitive test. While the test is not foolproof, it offers great value. It is longer than most leadership assessment tools, with the additional questions going to increase the instruments reliability.
The Profile XT measures what is referred to as “thinking style”, which is considered as a form of general mental ability? The instrument includes a measure of occupational interest, which most leadership assessment tools ignore. By using this instrument, an organization enhances its opportunity to identify the factors that lead to success for leaders.
The instrument has been subjected to test-retest procedures to determine consistency and achieved a correlation above .70 between two administrations. Reliability estimates were made for each scale on the PXT using Cronbach’s alpha. All scales in the PXT were found to have an alpha coefficient above .700. The instrument complies with EEOC, ADA, civil rights and all other federal and state regulations. The profile XT has been certified subject to the standards for test development that have been stipulated by the American Psychological Association and can be used for both pre and post-employment. The tool is administrable online, therefore, easy to send a link to a candidate. It takes an hour to administer and is worth the added time since it covers additional material.
This assessment tool helps an organization to identify the best candidates for its hiring needs. It brings with it a myriad of benefits. These include:It helps save time during the hiring process, it creates an efficient and effective hiring process, it helps in selecting the right fit for a job, it helps an organization avoid costly hiring mistakes, it increases employee satisfaction; and finally, it improves an employee’s onboarding experience.However, the most main benefit that it brings to an organization is that it enhances an organization opportunity to identify the factors that lead to success for leaders.
Identify the Outcomes, Data Or Information Produced by each Assessment
The assessment with regards to leadership promise will involve assessing the candidate with regards to their propensities to lead, their ability to bring out the best in others and their authenticity as well as integrity. This assessment will produce information that touches on a candidate’s leadership qualities, his or her ability to motivate other people to be more effective at the workplace and performers and the candidate’s moral standing and integrity. The more these traits standout from the assessment of a potential candidate, the higher their potential to lead.
With regards to personal development orientation, the assessment will be evaluating behavioral traits such as the candidate’s receptivity to feedback, negative or positive criticism notwithstanding, and the candidate’s agility to learn. That is, assessing a potential candidates’ strive to become better through a life-long desire to learn. Receptivity to feedback reflects on a candidate’s learning mindset, whether the candidate views feedback as a source of learning or distraction. A leader should not be afraid to admit that they were wrong. Learning agility allows an individual to reinvent himself. Assessing a candidate through this criterion will involve asking them questions such as what are the best business books you have read, and what did you learn?what lessons did you learn from your best boss and your worst boss? And, what stretch assignments have you taken on? What did you learn?
Mastery of complexity involves evaluating a candidate’s adaptability, conceptual thinking and how he or she navigates ambiguity. Adaptability involves the ability of a potential candidate to adapt to new situations, people and demands. That is, having an “Unwavering can-do attitude”. Conceptual thinking will involve assessing the candidate’s ability to keep the bigger picture in mind. Ambiguity involves assessing the candidate’s ability and courage to make correct decisions when faced with challenges and limited information.The last assessment would be the candidate’s balance of values and results. This will involve evaluating his or her cultural fit and passion for results. Cultural fit is regarded as one of the strongestcase for promotion of candidates from within an organization, it is therefore critical that a potential leader is assessed based on his cultural fit with the organization. Passion for results involves assessing an individual’s never-give-up attitude and his or her get-job-done focus.
These assessment criteria can be achieved through the administration of a combination of various assessment instruments with each instrument measuring a particular part of the assessment criteria. These instruments can range from the normal particular skill measuring instruments to more rounded tests such as 360-degree assessment instruments. The use of a combination of instrument will ensure that no one assessmentcriteria are overlooked.
Practical Considerations of the Plan
As mentioned, the assessment for potential candidates for leadership position will incorporate three approaches. One would be the use of a customized assessment instrument, fashioned to accommodate the specific characteristic needs of Robinson Insurance Agency; the other assessment would be an On-Job assessment, while the last would be a one-on-one interview.
The administration of the test instruments can be administered by the human resource department of Robinson Insurance Agency, or in the case that there is a perceived impression that particular candidates will be consciously or unconsciously biased by the administrators to their favor, the services of an external administrator can be welcomed. With regards to the On-Job assessment, this can be conducted by the immediate supervisors of the candidate as well as the workmates. With regards to the one-on-interview, the panel can be composed of the organization’s top management. This must include the company president Todd Robinson, who would be in a better placed position to identify which candidate best resonates with Robinson Insurance Agency’s company culture and philosophy of Client-first, and shows commitment to the company’s customer-oriented values and practices.
There would be no need for certification in order to administer any of the assessments. The assessments simply need to be impartial and should not in any way favor or be perceived to favor any particular candidate or discriminate any candidates based on their demographic characteristics as specified by the Equal Employment Opportunity Commission (EEOC). The management would only be involved during the latter stages of the assessments. That is during the one-on-one interview with potential candidates to evaluate whether the candidate reverberate well with the company’s values and philosophy, in a manner to show that their leadership potential will continuously endeavor to improve on the values that the company is associated with.
Potential legal ramifications that may arise if Robinson Insurance Agency implements an assessment-based approach and ways of ensuring that the approach is legal and justifiable
Concerns have been raised with regards to the legality of using assessment tests in hiring and promotion of potential candidates. As with other methods of making employment decisions, assessment tests can be scrutinized if there is suspicion that discrimination in employment decision has taken place. Poor impact arises when the selectioncriteria of a given demographic group is substantially lower than the selection rate of the majority group. Many employers utilize employee assessment tests in the employment selection process to identify candidate whoposses more than just the skills and knowledge necessary to be successful in their positions. By using scientific approaches during hiring, organizations increase their number of successful employees.As more and more companies opt to make use of employee assessment tests in the employee selection process, candidates faking and placating skeptics are not the only hazards an organizational can expect. If not developed appropriately, the potential legal corollaries of these assessment instruments can be massive. The most common and significant legal considerations in using assessment tests are the Title VII discrimination, the Americans with disabilities Act (ADA) among many others. There is also a need to ensure that the instruments comply with EEOC, ADA, civil rights and all other federal and state regulations. The tool also has to be validated following the standards for test construction aspostulated by the American PsychologicalAssociation.
Therefore, in order to ensure that no legal ramification arise if Robinson Insurance Agency implements an assessment-based approach to identify potential leadership candidates, it would be imperative that the assessment instruments fulfill the requirements as indicated by the relevant legal statutes, professional bodies and organizations that are concerned with employment laws and backed by constitutional laws. Thus, the assessment instrument should comply with the Title VII discrimination, the Americans with disabilities Act (ADA) to ensure that the assessment test does not discriminate any potential candidate on the basis of any demographic characteristic such as gender, race, religion, sexual orientation or physical disability. It will also be imperative that the assessment tool conforms to requirements specified by the Equal Employment Opportunity Commission (EEOC), Age Discrimination in Employment Act of 1967 (ADEA), Uniform Guidelines on Employee Selection Procedures – 1978, and The Standards for Educational and Psychological Testing – 1985.
In conclusion, the success of any organization depends on the effective leadership of an organization top management. For this reason, manager, supervisor, and other organizational leaders have a vested interest in the human capital that comprises their organization, especially the candidates who will be expected to drive the organization into the future. One way in which talented individuals can be identified is through the evaluation of their leadership potential which is achieved through the employment of various certified assessment instruments. Leadership potential assessment tests typically employ the use of questions or problems to evaluate an individual’s leadership potential through a combination of abilities that are beyond the contemporary cognitive abilities or emotional intelligences. They result to ensuring that the identified candidate is one who best exemplifies the values, cultures and beliefs of the organization, and therefore, is one who will ensure that the transition of a company between different leadership is swift and no negative deviations is reflected.
Adler, L. (2012). Hire With Your Head: Using Performance-Based Hiring to Build Great Teams. New York: John Wiley & Sons.
American Psychological Association, American Educational Research Association (AERA), & National Council on Measurement in Education (NCME. (2014). The Standards for Educational and Psychological Testing. Retrieved from American Psychological Association: http://www.apa.org/science/programs/testing/standards.aspx
Bérard, J. (2013, October 8). Accelerating Leadership Development: Identifying High-Potential Leaders. Retrieved November 19, 2014, from Global Knowledge: http://blog.globalknowledge.com/professional-development/accelerating-leadership-development-identifying-high-potential-leaders/
Berard, J. (2013). Accelerating Leadership Development: Practical Solutions for Building Your Organization’s Potential. New York: John Wiley & Sons.
Code of Federal Regulation. (1978). 29 CFR Part 1607 – UNIFORM GUIDELINES ON EMPLOYEE SELECTION PROCEDURES (1978).
Daly, J. (2012). Human Resource Management in the Public Sector: Policies and Practices. New York: M.E. Sharpe.
Reynolds, D. H., & Scott, J. C. (2010). Handbook of Workplace Assessment. New York: John Wiley & Sons.
Sorcher, M., & Brant, J. (2004). Are aYou Picking the Right Leaders? In Havard Business Review on Developing Leaders. Boston, MA: Havard Business School Publishing.
The Age Discrimination in Employment Act of 1967 (ADEA). (1967). United States of America.
The Americans with Disabilities Act (ADA) of 1990. (1990). United States of America.
The Equal Employment Opportunity Act of 1972. (1972). United States of America.
Title VII of the Civil Rights Act of 1964. (1964). United States of America.