Panies - For.leadership - Presentation FINAL

2009 Best Companies for Leadership
The future of leadership: a spotlight on the best Hay Group Webinar

FEBRUARY 18, 2010 RICK LASH AND CHRIS HUBER
Agenda
1 2 3 4 5 6 2009 survey findings Leadership focus is changing Creating a culture of leadership excellence: lessons from the best Enabling performance Conclusions Questions
2010 Hay Group. All rights reserved
2009 survey findings
The study results apply to all organizations

Regional distribution
Region North America Europe/Middle East/Africa Asia South America Pacific Total Per cent 45.5 29.7 16.0 5.6 3.3 100.0
Revenue distribution
Annual revenue in US$ Under 500 million 501 million to 1 billion 1 billion to 5 billion 6 billion to 10 billion Over 10 billion Total Per cent 31.9 12.1 23.4 7.5 25.0 100.0
Source: Hay Group / Bloomberg BusinessWeek.com | 2009 Best Companies for Leadership study
1863 participants from 1109 organizations completed a survey
2009 Top 20 Best Companies for Leadership

1 General Electric 2 Southwest Airlines 3 3M Company 4 Procter & Gamble 5 Accenture 6 Wal-Mart Stores 7 Nestle 8 Coca-Cola 9 McDonalds Corporation 10 Infosys Technologies 11 IBM 12 Cisco 13 United Parcel Service 14 IKEA 15 ABB 16 Zappos.com 17 Hewlett-Packard 18 Goldman Sachs 19 Unilever 20 General Mills, Inc.
5
The Best Companies for Leadership outperform others

Top 20 produce better shareholder returns than S&P 500

Top 20 vs S&P 500
1 year total return
10
3 year total return
5 year total return

8.43
10 year total return
4.02 2.97 Per cent 1.60 0 -0.15 1.02 Top 20 S&P 500
-5.43 -6.91 -10
Source: S&P Compustat data as of 9/30/2009

Best Companies for Leadership create better leaders
100 80 Per cent 60 40 20 0
94 75
90
87 67 54
Leadership development All employees have the programs enable employees to opportunity to develop and deliver on goals/strategies practice the capabilities needed to lead others
There are a sufficient number internal candidates ready to assume open leadership positions Top 20 All respondents
8
Leadership focus is changing
Todays environment is more complex

The competitive landscape has changed

Change isnt ending, its only accelerating Leaders need to be able to manage and lead in unpredictable times
The world is more connected

Global Information Technology Financial markets
We live in unpredictable times

Environmental concerns Political instability Economic volatility
10
Leaders need to be: agile learners strategic and tactical emotionally intelligent
11
Best Companies for Leadership are looking towards the future

Where companies report they are focusing their efforts now
100 82 80 65 Per cent 60 40 27 20 0 The downturn Recovery Positioning for the future 14 4 8
Top 20
All respondents
12
For the first time companies value strategic thinking more than execution
What companies value in leaders
Strategic thinking Execution Inspiring leadership Decision making Team work Influence Technical competence 0 10 20 14 17 29 20 30 40 Per cent All respondents
68 59 48 44 37 27 32 38 31 27
50
60
70
80
Top 20
13
Creating a culture of leadership excellence: lessons from the best
Creating a culture of leadership requires: managing and investing in development

What companies do to develop and retain leaders
100 80 Per cent 60 40 20 0 Organization actively manages a pool of successors for mission critical roles Company invests a lot into the people it needs People stay at this company primarily for growth opportunities 94 83 69 72 61 80
Top 20
All respondents
15
The best address bigger and broader issues to create a culture of leadership
Areas where the best are doing more than the rest
100 80 66 60 Per cent 60 46 40 20 0 Using corporate social Having a high responsibility to recruit proportion of women in employees senior leadership Making it easy for people to work from home Having an appreciation of global issues is a key job requirement 37 59 95 91 91
Top 20
All respondents
16
There is no one way to create an engaging culture
17
Types of cultures found in the Best Companies for Leadership

Big, complex, modern global organizations

Global issues are important Pool of successors for mission critical roles
Modern, learning-oriented, fun workplace

Moving between functions is extremely common People are expected to lead, regardless if they have a position of authority Emotions are discussed in the workplace
Collaboration for innovation

Employees are encouraged to take new approaches to solving problems If you see a problem or opportunity, youre allowed to address it Work life balance is taken seriously
18
Enabling performance
The real thing leaders do is create environments that drive performance

20
Employee effectiveness framework
Employee engagement

Commitment Discretionary effort
Financial success
Employee effectiveness
Customer satisfaction
Employee enablement

Optimized roles Supportive environment
Employee performance
21
The business case for engaging and enabling employees

High engagement only High engagement + high enablement
Employee performance
Increase in employees above performance expectations
10% -40% 71.% x2.5
50% -54% 89% x4.5

22
Employee retention
Reduction in turnover rates
Customer satisfaction
Customer satisfaction rates
Financial success
Revenue Growth
Source: Based on linkage case studies using Hay Groups global normative database
Creating a culture of leadership requires: empowering employees to lead and grow

What companies do to enable their employees
100 80 67 Per cent 60 40 20 0 Employees have the opportunity to develop/practice the capabilities needed to lead others Employees are expected to lead, regardless if they have a formal position of authority Employees are encouraged to learn in areas outside their expertise If someone sees a problem/opportunity they are encouraged to address it All respondents
23
90
85
86 66 57
89 71
Top 20
Conclusions
Learning from the best
Encourage purpose driven leadership
Identify opportunities for leaders to play a larger role in addressing strategic or company-wide issues that your market and the public see as priorities
Build cross-functional collaboration capability
Treat talent management as a strategic corporate asset (it takes an organization to raise a leader)

Use talent review forums to assess bench strength and make strategic development assignments Identify destination roles for high potentials and allow sufficient time in role
25
Learning from the best, continued
Leverage your culture to drive and sustain development

Include culture building metrics in personal scorecards Create culture building cross-functional task groups Establish a culture based on coaching and peer development
Develop strategic thinking skills

Provide the latest thinking in strategy, innovation and collaboration Expose leaders early in their career to senior level decision making
Expect your leaders to teach and mentor others
26
What does this years findings mean for organizations and leadership
Leadership more than ever will drive business performance in the future
Ignore Leadership and its development at your own peril
Best Companies for Leadership develop leaders who can operate in an increasingly complex and deeply connected global environment
There is no one way to develop a culture of leadership
Engagement and enablement are key to driving organizational performance
27
Questions
Additional resources
Best Companies for Leadership section on haygroup.com
www.haygroup.com/BCL
Questions?

Rick.Lash@haygroup.com Chris.Huber@haygroup.com
29

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2009 Best Companies for Leadership

The future of leadership: a spotlight on the best Hay Group Webinar

2010 Hay Group. All rights reserved

2009 survey findings

The study results apply to all organizations

1863 participants from 1109 organizations completed a survey

2010 Hay Group. All rights reserved

2009 Top 20 Best Companies for Leadership

2010 Hay Group. All rights reserved

The Best Companies for Leadership outperform others

Top 20 produce better shareholder returns than S&P 500

3 year total return

5 year total return

10 year total return

-5.43 -6.91 -10

Source: S&P Compustat data as of 9/30/2009

Best Companies for Leadership create better leaders

100 80 Per cent 60 40 20 0

Leadership focus is changing

Todays environment is more complex

The world is more connected

Global Information Technology Financial markets

We live in unpredictable times

Environmental concerns Political instability Economic volatility

2010 Hay Group. All rights reserved

Best Companies for Leadership are looking towards the future

Creating a culture of leadership excellence: lessons from the best

Creating a culture of leadership requires: managing and investing in development

There is no one way to create an engaging culture

2010 Hay Group. All rights reserved

Types of cultures found in the Best Companies for Leadership

Modern, learning-oriented, fun workplace

Collaboration for innovation

2010 Hay Group. All rights reserved

The real thing leaders do is create environments that drive performance

Employee effectiveness framework

Commitment Discretionary effort

Optimized roles Supportive environment

2010 Hay Group. All rights reserved

The business case for engaging and enabling employees

10% -40% 71.% x2.5

50% -54% 89% x4.5

Creating a culture of leadership requires: empowering employees to lead and grow

Learning from the best

Encourage purpose driven leadership

Build cross-functional collaboration capability

2010 Hay Group. All rights reserved

Learning from the best, continued

Leverage your culture to drive and sustain development

Develop strategic thinking skills

Expect your leaders to teach and mentor others

2010 Hay Group. All rights reserved

Ignore Leadership and its development at your own peril

There is no one way to develop a culture of leadership

Engagement and enablement are key to driving organizational performance

2010 Hay Group. All rights reserved

2010 Hay Group. All rights reserved

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