Investing in Your Leadership Pipeline: 7 Step Guide

Investing in Your Leadership Pipeline
We know that investing in your leadership pipeline matters.  According to research by Zenger Folkman, great leaders deliver more than double the value of poor and average leaders.  Yet, DDI’s latest Global Leadership Forecast report finds that only 11% of organizations have a “strong” or “very strong” leadership bench.

Even though the majority of companies know that they cannot afford to neglect the cultivation of future leaders if they want to remain competitive, short-term pressures combined with ineffective leadership development approaches make it difficult for organizations to consistently identify, develop, and retain leaders that meet future challenges with confidence.

What is a Leadership Pipeline?
We define a leadership pipeline as the explicitly defined and agreed to framework that organizations use to develop and nurture leaders at different levels to ensure a steady flow of motivated, loyal, and capable employees who can step into critical roles of increasing responsibility as the organization grows and evolves.

The four most common leadership pipeline transitions include moving:

• From Individual Contributor to First-Level Manager or Team Leader
  Success as an individual contributor doesn’t automatically translate to leadership — it requires a shift in mindset, behaviors, and approach. And being a people manager is not for everyone.

  The goal of this leadership transition is to help emerging leaders to build the foundational people management skills required to thrive — e.g., trust building, inspiring and empowering others, team chartering, decision making, delegating, managing performance, communicating, navigating complex environments, coaching, and giving feedback.

• From First-Level Manager to Mid-Level Manager
  High performing teams don’t happen by chance — they’re built with intention, focus, and a shared belief in being better together. Turning a group of talented individuals into a team with greater collective impact requires clarity, connection, and the ability to align everyone toward a shared vision.

  The goal of this leadership transition is to drive performance and engagement by helping managers to consistently and meaningfully align their teams and functions with broader organizational goals and team norms.

• From Mid-Level Manager to Senior Leader
  Senior leaders are expected to build cross functional commitment, role model company culture, and translate functional strategies into effective and collective action. This requires high levels of self-awareness, executive presence, and organizational impact.

  The goal of this leadership transition is to develop the strategic leadership capabilities required to influence across functions and successfully lead large-scale strategic initiatives.

• From Senior Leader to Executive
  Achieving this level of leadership and influence requires a personal transformation of key mindsets, behaviors, and habits related to progressing from a functional perspective to an enterprise first position.

  The goal of this leadership transition is to ensure that executives can master enterprise-wide decision-making, align and amplify organizational culture, and create company-wide strategic clarity.

Key Components Investing in Your Leadership Pipeline
Investing in your leadership pipeline in a way that makes a difference requires a strategic and systematic approach that aligns leadership development with organizational priorities.

1. Ensure that Your Business Strategy is Clear Enough
   It all starts with your business strategy.  Our organizational alignment research found that strategic clarity accounts for 31% of the difference between high and low performing companies in terms of revenue growth, profitability, customer loyalty, leadership effectiveness, and employee engagement.

   To be effective, talent management strategies must be strongly aligned with a clear, believable, and implementable business strategies.  Do not get fooled into embarking on developing a leadership pipeline unless you know the strategic priorities that the talent needs to deliver.

2. Assess Organizational Gaps
   Once your business strategy is clear enough, your next step is to identify the key talent and capability gaps between where you are today and where you want to go.  The goal is to understand what is required to develop or acquire the needed leadership talent for business performance and sustainability.

   The focus should be on high potentials, difficult to replace positions, and strategic roles that are pivotal to your organization’s current and future success.

3. Identify Potential Leaders
   Correctly identifying future leaders that will succeed is not as straightforward as it seems.  Why?  Because current job performance does not always equate to leadership potential or desire.  We know from leadership simulation assessment data that not all high performers have high leadership potential.

   Use proven training needs assessments, performance reviews, leadership simulation assessments, 360-degree feedback, and people manager assessment centers to accurately identify individuals with leadership desire and potential.

4. Develop Robust Training Programs
   We know from project postmortem data that generic leadership programs do not create extraordinary leaders.  A strong leadership pipeline requires a blend of formal and experiential custom training programs. Consider targeted action learning leadership development programs, stretch assignments, cross-functional job rotations, 1×1 executive coaching, and microlearning to promote career growth and development.
5. Foster a Culture of Continuous Learning
   Behavior and performance change — the goal of leadership development — is not a one-time event but an ongoing process. Creating a culture that values and promotes learning can significantly enhance your leadership pipeline. A culture of continuous learning should be pillar of your talent management strategy if you want to attract, develop, engage, and retain current and future leaders.
6. Monitor Progress and Measure Impact
   Regularly evaluate the effectiveness of your leadership development initiatives. Gathering skill adoption and impact data enables you to refine your strategy, address gaps, and ensure that your pipeline remains aligned with evolving business needs.  Training measurement also creates the culture of accountability and transparency required for talent to raise their performance.
7. Engage Senior Leaders in the Process
   Senior leaders play a pivotal role in building a robust leadership pipeline. Their active involvement demonstrates the organization’s commitment to leadership development while inspiring and motivating emerging talent.  Ensure executives model the desired behaviors, serve as mentors and coaches, share their insights and experiences, and champion leadership initiatives across the organization.

The Bottom Line
Done right, investing in your leadership pipeline can be a strategic imperative that ensures the sustainability and resilience of your people and your business. Prioritizing strategic leadership development builds stronger teams and moves strategies forward.  Are you systematically developing leaders at all levels to ensure you have the talent required to navigate challenges, seize opportunities, and execute your strategy?

To learn more about investing in your leadership pipeline, download The Top Skills for High Performing Leaders