The most comprehensive report into management development trends to date – released by the Chartered Management Institute (CMI) late last month – brings welcome news for training managers.
The myth that ‘leaders are born not made’, has finally been dispelled. More importantly, the report’s tracking of employers’ use of development over nearly a decade found a direct correlation between effective management and leadership development and improved organisational performance. In short, management and leadership development works, and there’s evidence to prove it.
But while the survey affirms the strategic importance of sound management development practice, it does contain some cause for concern for HR managers. It suggests they are out of touch with the extent and range of management development taking place in their organisations, and are making little progress in achieving influence at board level.
The CMI’s study, Management Development Works: The Evidence, was carried out using archive data collected in 1996, 2000 and 2004 to track changing patterns of management and leadership development policy and practice over the past eight years. Some 1,000 respondents, consisting of matched pairs of HR managers and line managers drawn from 500 organisations, contributed to the survey, which covered formal courses and programmes as well as coaching and informal, on-the-job learning.
The use of management and leadership development has steadily increased over the three periods, and the latest survey indicates employers’ investments are paying off – positively impacting on the organisation, and developing managers to meet business needs.
Mary Chapman, the CMI’s chief executive, says: “Clearly it is impacting business results, and more companies are taking the necessary steps to make that investment effective.”
Richard Brice, director of HR consultancy Blue Star and a member of the survey’s advisory panel, says the report is significant for the ’empirical evidence’ it gives of management development’s impact on organisational performance.
“It’s a tool in the kit bag,” says Brice, who is also HR adviser to the contract research company HFL, which has outsourced its HR management to Blue Star. “HR managers ought to be going to their respective senior managers and saying: ‘here is the evidence. You wouldn’t think twice about investing in a physical asset – this is something we ought to be doing to move the business forward.'”
The CMI first asked the question ‘what makes a good manager?’ back in 1986, but for the first time in 18 years, the belief that they are born rather than made was not the top response – a finding Chapman describes as “one of the most striking things” to come out of the new survey.
“In the 2004 research, job experience contributes just as much as innate ability,” she says. “What you gain from experience is more highly valued than personality,” she says.
While the report shows a link between improved organisational performance and management and leadership development that is strategic and sustained over time, it detects a need to improve on measurement – a frequent weak point of learning in general.
The report reveals that HR managers rate the achievement of business objectives and profitability as the most important measures of success for management and leadership development. However, in practice, difficulty measuring these points means that HR managers often opt for easier measurement methods, such as improvement in quality/customer satisfaction and productivity.
HFL uses the Investors in People (IIP) measure for management and leadership development to assess the effectiveness of its programme for ‘team leaders’ – scientists who have made the transition into management roles within its laboratories.
“IIP gives you the opportunity to benchmark what you’re doing against a national standard,” says Brice. “Any external benchmarking is good.”
Over the past 12 years, employers have taken on more responsibility for management training and development, with senior involvement steadily increasing since 1996, and a steady climb in the use of competency-based development since 2000. Such an approach means development activities are more likely to align with overall business strategy and objectives.
The suggestion that this alignment is necessary for HR activities to be effective is nothing new; it has long been advocated as best practice. A strong majority – 57 per cent – of organisations surveyed by the CMI in 2004 said HR is responsible for implementing management and leadership development. Yet, as the report notes, HR directors rarely have board level influence. How then are they to design an effective development policy?
Senior managers play a critical role in success, too, but while the report indicates they are highly involved in initiating management and leadership development policy, that involvement drops substantially after the policy’s implementation.
“Leadership from the top needs to be more than a statement,” says Chapman. “While there’s a high degree of ‘sign-up’, the view of more junior people is that this isn’t always carried through to implementation as it should.”
Anecdotal evidence about the rise of informal learning abounds, and 48 per cent of line managers surveyed in the CMI report rate on-the-job learning, such as a new challenge or work role, as the most valuable development exercise in the past year. HR managers, however, are far less likely to share this view, with just 11 per cent describing on-the-job experiences as the most valuable. In contrast, 51 per cent of HR managers – compared with only 24 per cent of line managers – rate formal management training, internal or external, as most worthwhile.
Similarly, when it comes to coaching, 34 per cent of HR managers rated it the most valuable method, compared with just 7 per cent of line managers.
A disparity of opinion between HR managers and their line management counterparts comes through elsewhere in the report, suggesting HR could be, at best, ill-informed, or, at worst, out of touch.
While the increase in money spent on management and leadership development has been marginal since 2000, there has been a dramatic jump in the time spent on development – at least according to line managers.
“The big change is line mangers saying they spent 22 days on development activities of one kind or another, up from eight in 2000,” says Chapman. “That’s a real transformation. People are recognising development comes in a range of ways.”
Yet HR managers’ view of time spent on management development differs wildly. They report a marginal rise from six days in 1996 to an average of 6.5 days in 2004, compared with the line managers’ view of 8.2 days in 1996, and a whopping 22 days in 2004.
“I think what we’re seeing is that in many organisations, HR activities have been devolved, with line managers taking responsibility for things such as coaching,” says Chapman.
“I don’t think HR managers are out of touch with the issues. I think it may be that they don’t have appropriate ways of capturing the diversity and wealth of activities going on – it’s not under their direct responsibility.”
The CMI’s view is that, in theory at least, HR directors are best placed to ensure that this all important link to organisational strategy exists, that knowledge transfer between departments can take place, and that cost effectiveness is achieved. Where best practice occurs with management and leadership, HR plays a prominent co-ordinating role.
But in reality, many organisations fall short of this model. When respondents were asked to rate whether HRM was a source of competitive advantage in their organisation (with 1 meaning strongly disagree and 5 strongly agree), the results were telling: line managers scored 2.9, with 3.0 for HR managers.
The CMI survey affirms the potential positive impact of management and leadership development on organisational performance – offering HR managers just what they need to make the case for learning. But at the same time, it should raise alarm bells in the minds of many in HR about their effectiveness at a strategic level.
Martyn Sloman, learning, training and development adviser for the Chartered Institute of Personnel and Development (CIPD), says it’s not a question of whether HR is up to the management development challenge.
“It simply must be,” he says. “People are not going to tolerate the ‘sheep-dip’ approach much longer. When it comes to any organisation that is seriously thinking about its management development opportunities, if HR is not in there as a big player, then where are they going for their advice? If I was that HR manager, I would be seriously concerned.”
Management Development Works: The Evidence tracked management and leadership development practice over eight years from 1996. It found that the extent to which employers take responsibility for management and leadership development has been the most critical factor determining success over time. If this factor was rated as high in 2000, then levels of staff engagement and overall organisational performance were also significantly higher four years later.
Other success factors outlined in the report are:
– Linking development to business strategy with established processes and frameworks
– Designing development to build relevant competence and behaviours
– Focusing development on the long-term tenure of staff.
– Management and leadership development was found to have a big impact on performance from 2000 to 2004 when:
-It was driven strategically within organisations, with board-level support and strong links to organisational objectives
-It was competency driven, designed to address managers’ abilities, motivations and potential to meet business needs.