Second Crack – The Leadership Podcast (Episode 44)

This transcript is AI-generated and may contain typos and errors.

[00:11] Gerrit: Dear listeners, a warm welcome to the latest episode of Second Crack - The Leadership Podcast. If you're new to the show, this is where we explore everyday leadership dilemmas and paradoxes, and where we invite you to self-reflect. I am Gerrit Pelzer, I work as an executive coach, and I use a combination of Western science and Asian wisdom in my coaching. Joining me today, as always, is my dear friend and business partner, Martin Aldergard. Martin specializes in driving change and transformation within the organizations, and what we both have in common is that we always put people at the center of our work. Hi Martin, it's great to be recording with you again today.

[00:57] Martin: Hi, Gerrit, likewise. And today talking about talent, and specifically about internal promotions. It's such a key decision that many leaders needs to do and still not always perfect decisions, right?

[01:15] Gerrit: Oh yes in fact, this subject of internal promotions comes up quite often in my executive coaching conversations, and when my clients bring it up, it's usually because something is not going as planned.

[01:31] Gerrit: And a very typical scenario is that somebody got promoted who was great in their previous role, and then once they are promoted, they realize that success at one level does not automatically, translate to success at the next.

So today we want to explore the most common issues, around promoting within an organization and more importantly, how to make these internal promotions a success. Because if we promote the wrong person, it's a very, very painful process. I can talk from experience here and it's also very costly for the organization.

[02:18] Martin: And I haven't seen it from an executive coach perspective, but I've come across this, for instance, in transformation projects we're then the wrong managers have been promoted, and it shortcuts a lot of the effort in trying to promote a desired culture for instance. It communicates a lot, who you promote. So let's dive into this. It's super interesting topic and very critical.

[02:45] Gerrit: Yeah. So as I, as I mentioned, there are three key aspects that come to mind and the first one we have already mentioned, and that is that there's a very high tendency to promote people based on their past performance in a particular role roll. But I think there are two things going wrong here. Number one is that we sometimes see promotion as a reward for performance, right. So you work really hard in your role, and then the reward is, you are promoted to the next, higher level role. And then the second aspect is that oftentimes performance is confused with potential. Performance does not equal potential, and potential here means the ability or the likelihood that someone will perform well in the next higher role. 

The challenge here is that the skills and competencies that made you successful in one role. These skills and competencies are often very different from what is needed at the higher level role. So for instance, let's start on the level of individual contributors, right? So the next level might be then leading a team. So on this individual contributor level, you typically need, professional ,technical knowledge. May maybe you want people who work hard, but then if people are supposed to lead the team, yeah, of course you need a basic level of professional or technical skills, but the key is then more around how do you motivate people? How can you create an environment where there's high employee engagement? How do you deal with conflict? How do you communicate and how do you eventually interact with other parts of the organization?

Then thinking maybe about another level, when you think about moving on from sort of a team leader level to leading a business unit, then suddenly your focus may shift to more strategic thinking, um, visioning skills, something like that.

[05:12] Martin: It's quite clear and still managers do mistakes. And I think one thing might be the fear of losing a high performer, right. It, doesn't matter on, on which level we're talking about you want to keep a high performer in the organization or in the team, so you promote this person because promotion is a reward. And then suddenly they are in a role that they're not capable. Or vice versa, you don't promote them because you need the person in the team as a high performer.

[05:45] Gerrit: Yes Martin and that is quite common, right, because this promotion is something that we dangle in front of the people like a carrot. And with this we open up this field of rewards within an organization, because a promotion is not necessarily the best reward. I wanted to discuss maybe another aspect first, and that is what I also often see is that people or whole organizations struggle in clearly identifying what skills and competencies are needed in a particular role. It's often associated with this idea that people just assume, oh, everybody knows what is, for instance, a vice president of sales supposed to do, we don't need to write it down. But the reality is people may have very different interpretations. So it's really worth the effort to take the particular role and think about what is really needed to be successful when you have this role. Skills, competencies, and then when you think about the candidates you have internally for the role, is to say, okay, what is a potential gap here? What are the skills and competencies the candidate has and what may need to be developed? But the big challenge is here, let's take for instance, the individual contributor before, who needs suddenly on the leading team level, much more of the so-called soft skills. Do they actually have a chance to demonstrate this in the current role? And often the answer is, is not, right, so how can you overcome this? Well, I think first of all, you need to start early with for instance, succession planning and observe people. Let's stick with the individual contributor: have you seen this person in meetings and how they interact with others? Do they have, for instance, facilitation skills? Or can you assign high potentials to maybe a special project. When I think of my own corporate career, I had my normal role, but in addition, I was assigned to take the lead in a team of peers. We were spread not only across different countries, but actually three continents. And while of course the organization wanted some results coming from this project, from this team, I'm pretty sure people also observed how I acted in this role. So this is one way of observing it. You might also assign people to a special project, maybe launching a new product where it's not critical for the survival of the business. Right? And this can be quite nice because for the people in this project, it can be fun. If something good comes from it, the organization benefits from it. And you have the chance to see, okay, who in this project team demonstrates which capabilities and how are they eventually useful in the, next level role.

[09:11] Martin: What I'm hearing from this and thinking is that we need to do all the groundwork, the preparation work long before we have a gap to fill. And this then immediately leads me to the conclusion: talent development, including promotion and moving people up the ladder, is every leader's responsibility, every manager's responsibility. It's not HR responsibility.

And another thing that you're talking about now, I think, is the role of learning and developing on the job. Because what you're describing to me is a lot about a manager that assigns the right job, the right task, the right project at the right time for each of his or her team members. So a. person doesn't stay too long with the current assignment, the current project,because then you stop to develop, and knows when is the right time ah, I have a great project for you or I, I have an assignment that I think would challenge you and develop you. And this means, of course, you are growing people all the time in a continuous process.

And the other thing that you mentioned early on, I'm thinking about making sure that we have a as wide talent pool of candidates as possible. So this means, for instance, you mentioned a role description, what is needed in this new position. If we can communicate clearly and transparently what is in a certain role, we can then also communicated more broadly, and open up for more candidates internally to apply. If we don't have a clear understanding of what we need, how can we give people a chance to both know about it and also strive to develop towards it? Here we have two important things: Be more open, be more transparent, take the time to understand what is needed in each role and communicate it.. And secondly, that talent development, including promotion is, it's the role of every leader in the organization.

[11:38] Gerrit: Yeah. Now I would like to emphasize what you just said, that this is continuous business. Because in the everyday life, the people I work with, they are extremely busy. And in this famous Eisenhower Matrix, the talent development, the succession planning, it's always in the quadrant that is, of course, very important but not urgent. It only gets urgent when suddenly somebody needs to be replaced, right? Somebody moves on or maybe even an accident happens, and suddenly it's super urgent. And then if you haven't done your homework before, it increases the likelihood of getting it wrong dramatically.

 And getting it wrong, we, we always want to focus on how to get it right and I would actually talk about a tool that we used in my previous company. I think we have done quite a good job with that. It's called the Performance Potential Matrix, and I know a couple of companies actually use it, but I also know that many don't use it, so I think it's worth talking about it. It's relatively simple looking three by three matrix. And then you could, for instance, on the X axis you have performance, and on the Y axis you use potential. So first of all, very clear, there is a distinction between performance and potential. So there's the performance in the current role, that is relatively easy to measure, right, so if you have somebody who always exceeds performance targets, then you put them in the very right column of this matrix. The potential is a little bit more difficult, and so we need perhaps some standardization. So within the organization, you need to discuss what does low, medium, and high potential mean. For instance, high potential could be, okay, this person is ready to take a next level role right away. Yeah. So you need to be able to agree, and then one way to approach it, that within the senior management team, every manager lists their direct reports in this matrix, and then they meet to discuss. So, for my people, I would then make the case and explain why I put each one in that particular box. But then what is very important, the other members of the senior management team can either confirm or challenge my view to make sure that there's alignment. So for instance, I might have somebody in my team who is a boss pleaser, right, who says yes to everything I want, and, makes sure he always shines in front of me. But then in such a discussion, it may turn out that he constantly frustrates people in other departments, is not open to other people's opinion. So maybe such a person is not the best for a next level role. Or it can of course also be the other way around. Maybe I have a personal, personal issue with one of my direct reports, but then I might get the feedback from my colleagues from the senior management team, that they feel no, you know, he always excels and is very helpful, has this big picture view. So, this is a, a very, very useful tool to increase the chances of making the right decision in promotion.

I think what we haven't touched on, there is no guarantee that, that you can promote the right person. It's more like a jigsaw puzzle where you collect different pieces and, and that is one of those. 

[15:28] Martin: My reflection here is I also come across this, I come across quite a few companies using this, this matrix, right. And I think, again, the usefulness of this tool comes exactly how it is applied. If there is understanding among senior leaders, of course the talent is critical and that they allocate time for this, I've seen very good examples where this is already incorporated in the annual cycle of the company. So there is already standardized when do we have the talent review processes. And it permeates throughout the organization, right. Because on every level this needs to be on, on department level, on business unit level, and then of course on corporate level. And, and you have an, an open and frank discussion and alignment about the talent pipeline in the company. But without that culture and that deep understanding, I've also seen total manipulation of this because you know, personally, who you would want to get in what quadrant and any fact and data doesn't matter.

This all connects then down to the one-on-one development talk that every manager should have with their people. If each manager doesn't know his or her own people very well, how will they then be able to fill in the matrix? So, so it's all connected and again, the tool works when the culture is there, and when for instance, also a habit of regular one-on-one development talks is established.

[17:23] Gerrit: And adding on this, what you just said, you have maybe this annual review. It comes back to what you said earlier, still it's a continuous process, right? So taking the example of the busy leader, busy solving problems every day, getting results. And then, oh, next month we have the review again, and then you start preparing. It's something where you need to keep this in the back of your mind all the time.

the time. Yes. It's almost like take every opportunity to think about these items and also bring them up with your people. Talk about expectations, talk about potential. Make it clear also, what do you need in order to be considered to move up, or be considered for a higher role so we can work on it step by step, long term, small steps every day, long term. And, and this is something we haven't touched on at all yet: There is also this question, does a certain candidate actually want a particular role? And I've seen this when I was working in Thailand. They had this very traditional approach that people were just assigned a new role from one day to another, and the candidate was actually not involved in this process at all. You spoke before about the corporate culture and I think what we need is also a culture of openness. I have seen too many work environments where there is a tendency to think like everybody's expected to want corporate career, they want to be promoted, the sooner the better. But some people are eventually very happy in their role as an expert. And then it comes back to another thing you mentioned before, how do we reward people? Because coming back to the performance and potential matrix, if you have a high performer in a particular role, as long as everybody is happy with that, we don't necessarily have to change that.

[19:29] Martin: And, and of course this is why quite a few organizations also put in a different career path. There is a vertical career path and there is a horizontal career path.

[19:40] Gerrit: Exactly.

[19:41] Martin: to try to accommodate different needs.

[19:44] Gerrit: Yes. And then let's say the second big theme, it's relatively short, is, you can also relate it to the potential performance matrix where maybe somebody always remains on the medium potential level. So what I experienced quite a lot is, "yeah, yeah, this person has the potential, but maybe not just ready yet." Then this goes on for years. The person is never ready. And I think here leaders also need to have the courage to say like, well, sometimes we just have to throw people in the cold water. And well not, not just hope that they swim, but we have to observe them and give them support to swim. And what is often underlying here is that senior leaders have, too narrow picture how the person should look like in this particular role. And this is not what we said before. It's not contradicting that we need to have a clear picture of the skills and competencies needed in this role, but it's often more about the personal style. And more often than not, it's, "I want this person to be more like me. Then he or she will be a great leader," but first of all, again, it hinders promotion, and worse than that, I think it does not allow people to bring their personal style and strengths into a particular role because as we all know, we will be at our best when we can be ourselves. So that was the the second item I wanted to highlight. 

To combat this, this unconscious bias from leaders then is to make talent review processes in the leadership team, or make talent review panels, where there are more different eyes looking at this. Not only the manager, or not only the hiring manager looking at this. And of course, it's a lot about the support. What happens when I accept a role. My company trusts me, but I'm not so sure myself, but I'm still going to take the jump. I mean, that is what leaders are all about, helping people to find out what they could do that they didn't know that they were able to do. Yes, absolutely. Yes. Yeah. And then there is this third aspect, and this is typically when people bring it, to our coaching sessions, and that is after the promotion. People realize they have been involved in a, in a promotion, they made eventually decision themselves or contributed to it and it doesn't work out. And the problem that I often see then is that people are waiting too long and they hope that things will sort themselves out somehow. And I understand where this is coming from. So if I have decided I wanna promote this person, then it's very hard to admit that perhaps I made the wrong decision. And, and maybe it's not even about admitting it. Maybe it starts with really seeing it that it's not working. Because we, we want so much that it works, that we get a little bit blind here and there. Or eventually we want to avoid these painful discussions. And I think turning it it around again, how can we make it work? We come back to what we said earlier, we need to be clear about what's needed in the, in this new role. We need to identify the gaps. We need to communicate those, we need to communicate the expectations, and then eventually implement, a development plan. And while this maybe seen now from the more senior role, I think also the candidate, I would always suggest to them well be proactive. For instance, talk to the different stakeholders that you affect in your role and ask them about your expectations. In my role, how can I support your department or your business unit? How can I help you to have less sleepless nights? I think this is extremely powerful and it's not regularly done.

[24:10] Martin: Hmm.

[24:11] Gerrit: But again, coming now from the more senior leader role, so after we have identified the gaps, communicated the gaps, communicated the expectations, then we need to give feedback along the way. And I have also seen that even if people give the feedback with best intentions, it still keeps dragging on. There's always hope, we don't want to lose face. We don't want to lose face ourself because we've promoted the wrong person, we don't want the other person to lose face. But also, Martin, as you said earlier, this can have huge negative impacts on the whole organization. So when we realize we've made the wrong decision, the longer we keep the wrong person in that role, it can have a huge demotivating effect on others. It can have, of course, negative financial impact on the company. And we ha we have a German saying, which is hard to translate, but I think maybe it's something along the lines of "better, a miserable end than endless misery".

[25:25] Martin: Hmm, and, and my take on this is that as a leader, I've put myself in an impossible situation. And it's bad on so many levels. It's bad for the organization. It's bad for myself, it's bad for the person I promoted into the wrong role. And there is only firefighting to get out of this bad situation. What we need to do again is so work so hard to avoid it ever from happening, by being proactive about talent development. And also that means if we have a culture of continuously developing talent on the job, a promotion decision doesn't become this big event. It's just part of an ongoing process of moving everybody in the company, one step up the whole time. Smaller steps or bigger steps, depending on what level we are talking about. Almost on a daily basis, people getting new assignments at the bottom of the pyramid. And if that way of working is there, the promoting decision to a new critical role doesn't become that risky. Because first of all, you have a much wider pool of talent to pick from. You are not locked to one particular individual as the only candidate. And also you have talked so much about what we need in the future in term of what, what capacities, what competencies we need, what we're, what are we aiming to develop, so when we have the need, we have suitable candidates, but also we communicated to people so expectations are much more open and much more clear.

[27:16] Gerrit: Yep.

[27:16] Martin: we have de-risked the whole internal promotion process.

[27:22] Gerrit: And what I liked is that you said it's, let's not make the promotion such a big one-time event. It's a more natural, a natural process all the time, I like that very much. I wanted to bring a positive spin maybe to the last item that I mentioned, uh, like, uh, we wait too long with candid feedback when things are not going so well. Of course, having the discussion that, let's say we realize it has been the wrong decision and we need to make changes. Yes, of course this discussion is painful, but I've seen it also many times that once changes are made, that afterwards actually everybody is happier, including the person who was in the wrong role because they, they might be then assigned to a role that fits them much better, so they enjoy it more. If then this candidate is in a more suitable role and we find somebody else for this other role, performance is better and, and the people around them, eventually, the whole organization, is more happy with the situation. So we should not shy away from these difficult discussions.

[28:34] Martin: If we are a, a fast moving company, we are adaptive, we have a culture that is open and transparent about development, about performance,. I think it also becomes much more natural,  it's not a big deal if a person lands in the wrong role, 

It's just part of learning, right. I think this is to also not make it a mistake so right.

[29:00] Gerrit: Hmm.

[29:00] Martin: It's part of development. And perhaps we didn't, understand the requirements in this role properly. Or environment has changed, the situation, the context has changed. So to say, to move around, test the waters, it should be more natural. It should not be a big deal, a big issue. And, from that point of view, we need to find ways where we can talk about potential, about performance, about job fit, with less negative connotations.

[29:35] Gerrit: Martin, I think we've covered a lot of ground. Anything else to add or would you like to go ahead with any reflection questions. 

[29:45] Martin: I, like to go to reflections and what I'm taking away from thinking and talking with you about this is, is the continuity in a talent development process, including promotions,. And how important this is to work proactively, this Eisenhower matrix that you mentioned might be one of the biggest reasons why we end up doing the wrong promotion decisions, we don't spend sufficient time. So my reflection question would of course be then: as a leader, how important is talent development to me? Do I spend sufficient time or does it always get the lowest priority and then I end up trying to fire fight in the very end because I need to make a quick decision that ends up not being a very wise decision.

[30:38] Gerrit: Yeah, and my reflection question would go in exactly the same direction. Maybe I build on what you just said. So perhaps in the evening of a working day, you can ask yourself, what have I done today in terms of talent development and succession planning? Were there opportunities where I could check on people, whether they demonstrated certain skills and competencies that would either qualify them for a different role, or have they shown certain behavior, which is a bit of an alarm bell saying this person might not be so suitable for a particular role. And then if I do this regularly, I can see a bigger picture and then approach people also more actively.

[31:27] Martin: Super.

[31:30] Gerrit: Well, this concludes today's episode then. If you would like our support in accelerating your leadership development, be that in a company-wide initiative or through individual executive coaching, please do not hesitate to contact us via hello@secondcrackleadership.com. And if you enjoy the podcast, please remember to subscribe and tell a friend about it. And if you could leave a positive comment or rating, we would certainly appreciate it. 

Bye for now.