In the mid-1990s, I was on the forefront of CRM (customer relationship management) implementations for Fortune 100 companies. I was part of the team that developed the CRM implementation vision recognized by Gartner as one of the top 3 in the industry. Previously, CRM was marketed as solely a technology solution, and organizations were encouraged to purchase XYZ software solution today so they would have CRM tomorrow. We were one of the first companies to recognize the importance of having well-trained people and well-developed processes for a successful CRM implementation.
The one piece missing in that vision was the importance of leadership. The common thread I found in successful CRM implementations was the presence of an engaged leader. On projects where an engaged leader was involved, the project went smoothly. On projects where the leader took a ‘hands-off’ approach, those projects tended to falter.
Fast forward 20 years to healthcare electronic health records implementations and the same outcomes were witnessed. In organizations where good leadership was practiced, the implementation went smoothly. In others, they didn’t. I addressed this in my first book, “Competing on Healthcare Analytics.” Additionally, my Lean Six Sigma and project management training has also identified leadership as a critical success factor.
Based on my work experience and 8-years teaching in a top 20 organizational leadership graduate program, I’ve concluded that leadership is an organization’s most valuable resource. A great leader can impact an organization far more than any other resource. Leadership resources management (LRM) is a data-informed approach to strategically manage an organization’s leadership resources. It helps identify gaps in an individual leader’s practice of leadership, as well gaps in the perception of their leadership by their team. LRM replaces subjective interviews, relationship-based promotions and selections with a quantifiable, repeatable and unbiased leadership management strategy. When properly utilized, it helps the organization assign or promote the right person with the right leadership qualities to the right position at the right time.
CRM is a business strategy focused on managing and improving interactions to maximize the value of the customer relationship. It involves:
- Identifying and retaining valued customers;
- Identifying upsell and cross sell opportunities for customers;
- Finding new high potential prospects;
- Building a strong customer portfolio;
LRM is more important that CRM because it impacts not just customers, but every aspect of an organization. Good leadership can result in operational efficiencies, higher profits, improved customer satisfaction, improved employee satisfaction and a better organizational brand or stature.
When properly implemented, LRM’s goals are similar to CRM’s goals, such as:
Identify and Retain Valued Leaders
The key to retaining valued leaders is to first identify them using a quantifiable, unbiased and repeatable assessment tool. Once identified, the leaders are segmented into tiers by their Potential for Leadership and their Practice of Leadership. The organization should do everything they can to retain Tier 1 leaders. Retention is not simply a financial issue, but also organization culture and support. Tier 2 leaders should be provided growth opportunities to enable them to develop into Tier 1 leaders. Tier 3 leaders should be monitored to determine if growth opportunities will motivate them to become better leaders or if they have already reached their full leadership potential.
Identify Promotions and New Opportunities for Leaders
Armed with information on the leadership qualities a person possesses, an organization can better match the leader with the right opportunity. For instance, if a leader is great at coaching, they may be a great candidate to lead a new product or service team. If a leader is great at communication and storytelling, they may be a great candidate to lead a team facing several challenges.
Hire New High Potential Leaders
Just as it is more efficient to focus on acquiring high potential customers, organizations should look for exceptional leadership qualities in new hires. This information can be gleaned during the interview process or in reference checks. A resume alone may not tell the entire story.
Build A Strong Leadership Resources Pipeline
One of the reasons it’s difficult to build a strong leadership pipeline is because oftentimes good leaders move on to other organizations. After all, an organization’s best leaders are usually the most marketable and will leave if provided a better opportunity. Once an organization knows who their best leaders are, their responsibility will be to retain them by removing or reducing any friction that could result in an unenjoyable work situation.
While CRM usually analyzes customer purchase behavior, LRM analyzes leadership behavior and compares an individual’s self-assessment to behaviors and perceptions of other leaders.
Initially, the individual leader is compared to the population average of all who have taken the assessment to provide context. In the team assessment, the leader is compared to the perception of their leadership by their peers, supervisor and direct reports to provide a complete picture of how they lead. In the organization level assessment, the leader is compared to others at the same organization level within their organization, and/or to all others who have taken the assessment who are at the same organization level.
With Leadership Resources Management, an organization can move beyond just leadership development but advance to leadership management.
To learn more visit our website at LeadershipRM.com or attend my case study presentation on an LRM implementation at the SHRM National Conference on July 1st.
