When building leadership capabilities in an organisation, it is tempting to dive straight into a leadership development program – perhaps an executive retreat, a facilitated workshop or an online learning module.
But if you rush straight to this point you may have already missed the chance for the leadership development to achieve its aim. And at the end you may find yourself with wasted funds and few tangible improvements.
It is far wiser to undertake a proper leader assessment process – initiatives that give people insight into their strengths and areas for improvement as well as evidence to focus future development. Get this right and the leadership development activities you undertake can be targeted where they will add real value.
Despite the benefits, in our extensive experience working with organisations to develop their leadership capabilities, we have found a thorough leader assessment process is still surprisingly rare.
What is leader assessment?
It is no surprise that organisations are investing in leadership development. Research shows that leadership development can enable organisations to outperform others in customer loyalty (+10 per cent), profitability (+21 per cent) and productivity (+20 per cent).
But for leadership development to impact performance, it needs to be informed by an assessment process. This process can help an organisation to understand what leadership development can look like and what capabilities should be prioritised in its context.
Leader assessment can measure a leader’s current capability, future potential, fit and motivators. It may include psychometric assessments, 360-degree feedback surveys, behavioural interviews and work-role simulations.
The assessment process itself enhances development, growing personal insight as leaders progress through the assessments and receive feedback. Assessments can prime leaders for behaviour change and highlight areas of focus to strengthen performance.
Through our work partnering with organisations to assess and grow their leaders, Nous has found four essential principles for effective leader assessment:
1. Link to clear development outcomes
Leader assessments in a talent management context should be conducted for development rather than for role selection. Linking assessments to promotions can distract leaders from focusing on growth and being vulnerable about areas for development. Assessments combined with development activities can contribute to stronger leadership growth. For example, 360 feedback, when used in conjunction with coaching, can increase leadership effective up to 60 per cent.
Further, the development should be linked to the context of the organisation; that is, growing an awareness of the extent to which leaders demonstrate the capabilities required to meet organisational goals. This focus on organisational outcomes can support assessment processes to shift individual and, in turn, organisational behaviours through collective capability uplift.
Assessing for the purpose of development can increase buy-in from leaders as they have a clear sense of how they benefit. To create a strong link to development, close the assessment-development loop through dedicated feedback sessions and development planning conversations (sessions with the leader and their manager, facilitated by a leadership coach). Having time for the leader and their manager to explore development goals positions leaders to take action on areas of focus highlighted in the feedback session and to readily implement what they learn from the process.
2. Tailor to the leader’s context
A leader assessment should be matched to context – the capabilities required for high performance in the leader’s role. While the tenets of effective leadership are universal, the way they manifest or the priorities for the organisation – and the leadership required to meet them – can differ.
So a leader assessment process should flex to align with an organisation’s priorities and goals, and the challenges a leader may face. Contextual factors include strategic priorities, team and organisational culture, the type and focus of the organisation, and the operating environment.
A global assessment of 9,000 leaders in 80 countries conducted by research firms CEB and SHL found that:
- Understanding and aligning to the leader’s work context improves the ability to predict leader performance by as much as 300 per cent.
- Better prediction of high-performing leaders translates into a 22 per cent increase in leader performance on average, which in turn is associated with a 4 per cent increase in revenue and a 4 per cent increase in net profit.
One assessment tailored to the leader’s context is a bespoke 360-degree feedback survey that assesses leaders against the organisation’s capability expectations. This tailored assessment is aligned to the unique needs of the business, with identified strengths and development areas directly linked to the leader’s role in meeting organisational goals.
Work simulations and role-plays also link assessments to the leader’s context. Simulations should reflect the tasks and challenges leaders engage with in their roles and should bring to life the unique requirements of leaders in an organisation or sector. As one participant in a recent Nous-run simulation noted, “The tasks were well-pitched to the environment.”
Nous uses two assessors in simulations: a leadership expert and an industry expert. This ensures insights focus on the leaders’ behaviours in their business context. This tandem approach allows for a nuanced and rich assessment and participant experience. One participant from a recent process reflected that they “felt the complementary skills of the assessors and deep government experience facilitated more in-depth discussions.”
3. Deliver in the format the work is in
Assessment delivery should mirror the way leaders work. Now more than ever people are working in a virtual or hybrid way, rather than in person. Matching assessment delivery to the way work is undertaken allows assessments to simulate the work environment. Direct observation of a leader over a longer period in their day-to-day role is time consuming and costly, so this method of assessment achieves the desired outcomes quicker and cheaper.
Organisations were once hesitant to deliver assessment and learning experiences virtually, but this has become essential. Through our work with organisations over the past year, we have demonstrated that virtual delivery is viable for leader assessments, with leaders finding the experience valuable.
Virtual delivery can also increase access to leader assessment, including increasing participation from leaders in rural and regional areas, allowing leaders to fit in assessment components around operational requirements and supporting leaders to complete the assessment in a comfortable environment.
In 2020, Nous delivered several leader assessment processes with all components delivered virtually, including follow-up feedback and coaching sessions. This ranged from 360 feedback processes to multi-method assessments. Simulated work discussions and presentations were delivered via videoconference, as were structured behavioural interviews and feedback sessions.
A leader who experienced the virtual feedback process said: “It has been a really powerful and positive experience. I thank you and Nous for the way in which the process has been rolled out and our discussions.”
Evaluation from a multi-method virtual assessment showed that 100 per cent of participants gained value from the virtually delivered feedback and development planning sessions, as well as the virtually delivered components of the behavioural interview and work simulation.
4. Take a strengths-based approach and assess leaders at their best
Assessment should focus on strengths and ongoing development. The process should treat people like people and value their experiences. The user experience should be supportive and set the right environment for leaders to do their best. Assessors should aim to realistically assess how the leader operates in their role, rather than seeing them at the height of their nerves.
The tasks should align to the leader’s role so they can showcase their skills. In a recent assessment process, Nous created scenarios for a work simulation. All scenarios tested the leader’s ability to think strategically, work well with stakeholders, and drive solutions development. But each scenario let the leader undertake this thinking and solve problems on a topic relevant to their work. This sets the leader up for success rather than placing any leader at a disadvantage due to the subject matter.
Feedback and ongoing coaching sessions process should also take a strengths-based approach, given this enhances outcomes around motivation, productivity, wellbeing and engagement. Debriefers should highlight areas for improvement and growth, rather than framing capabilities with lower scores as deficits. This shift in framing can support the leader’s focus on continual improvement and generate motivation around development initiatives.
Assessors can take a strengths-based approach to explain how a leader can use their strengths to address areas for development. For example, in a recent assessment, a leader had high ratings in external stakeholder management but low ratings in internal relationship development. The assessor supported the leader to see how they could draw on the behaviours going well when engaging externally to build internal relationships. A strengths-based approach supported the leader to identify tangible development actions.
Better understanding your leaders lets you target development
Leadership skills take a concerted effort; that is, thoughtful leadership development. And this leadership development starts with comprehensive leader assessment.
Organisations that do not accurately understand the development needs of their leaders risk implementing development initiatives that overlook the capabilities that most need development. This can result in leaders falling behind peers and development initiatives failing to deliver a return on investment.
Do it right, though, and your organisation can develop the next generation of leaders with the skills and capabilities to allow the organisation to achieve its vision.
Get in touch to discuss how Nous can help you to implement leader assessment to better understand your leaders’ development needs.
Connect with Tessa Dehring and Sally Cutts on LinkedIn.
Published on 8 July 2021.
 Gallup Q12 Meta-Analysis Report, 2016
 “The Impact of Executive Coaching and 360 Feedback on Leadership Effectiveness”, Elizabeth Thach, 2002
 “Contextual leadership: A systematic review of how contextual factors shape leadership and its outcomes”, Burak Oc, 2018
 “Creating Successful Leaders: The Biggest Missing Factor”, SHL, 2018
 “Now, discover your strengths”, Marcus Buckingham and Donald Clifton, 2001