Robert Hargrove

Fire the Leadership Training Department

GE is a company world famous for its leadership pipeline that turns out world-class CEOs, not only for GE but for other companies. It started back in the 50’s when GE CEO Ralph Cordiner decided to decentralize GE into a 150 operating units, each of which would require a CEO in its own right.

This led to developing a top down, centralized approach to leadership development made famous by Jack Welch and copied by many firms. Its hallmarks include coming up with a list of GE leadership competencies, sending high potential executives to the GE leadership center at Crotonville, and a month-long yearly talent review known as Session C, culling the bottom 10% of the management ranks.

However, there are signs that the basic paradigm of leadership development that GE made famous is about to change. It started when CEO Jeff Immelt was faced with the impact of the global banking crisis on GE Capital. This reduced the company’s net worth from something like $500 billion to $250 billion, and led to a precipitous drop in the stock price from $29 a share to about $6.

Up with CEOs Coaching High Potentials; Down with the Corp U

After going through what he termed as a period of “self reflection on steroids,” Immelt started re-visioning GE’s top-down, centralized, leadership development paradigm. To paraphrase his comments in a recent Businessweek article: Someone at GE Capital must have been thinking ‘Aren’t we overly invested in subprime housing shares?’ If they did, why didn’t they tell me? What kind of leaders are we developing around here?

Further, Immelt may have gotten wind of a quiet revolution brewing amongst GE executives who have started to question the wisdom of marching people off to abstract training programs and spending so much of their time away from the business and customers.

Today, Jeff Immelt’s new approach to leadership development looks much more like personalized coaching and much less like the top-down, centralized approach of yore. A few months ago, Immelt started what he calls a “sleep over” program. Each month, he holds 10 personal one-on-one dinners at his house with the top GE leaders.

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The typical evening involves a few drinks, a plate of pasta, and conversation focused on getting to know each other. At night, Immelt stays home and the executive goes back to the GE Conference Center. The next morning the executive returns and the two have something like a real coaching session on everything from leadership development to strategy, to current problems.

Immelt has also brought in (for the first time) to leadership coaches for many of GE’s top 150 leaders to work on their leadership and business challenges. In the past, coaching was reserved for remedial efforts. Immelt doesn’t quite say to fire the GE training department (the whole nine yards), preferring to say things like Crotonville, Session C, and Boca Raton meeting are cauldrons: “We have to change what happens in them.”

Focus Coaching on Real Goals, Not Artificial Leadership Competencies

However, my thought is that, if you keep these cauldrons, everything will take the shape of the container. I have been told many times by company Chief Learning Officers that they need to bring in coaching. The next thing you know, they invite me to do a 1 day training program on coaching versus actually pick a few executive as guinea pigs and provide them executive coaching.

Every company thinks they need a leadership development department, but I fundamentally question that assumption. The job of developing leaders in this approach is offloaded to HR or corporate universities, who for the most part, don’t operate in the world of business, customers, or results. On the contrary, I have seen first-hand the power that comes from a handful of executives declaring an Impossible Future and then deciding to take on the task of coaching the high potentials to help realize it.

That’s why I suggest throwing out the old top-down, centralized leadership development paradigm and the corporate universities and training departments that foster it, and replace it with something much more effective. To me, this looks like CEO’s and executives getting personally involved in setting high goals, hiring top talent, and then coaching people to accomplish what really needs to be accomplished.

Google's "Hire a Coach"

There are some signs that I am not alone in this thought process. Google CEO, Eric Schmidt, has said that the best advice he ever got when he became CEO was from the famous venture capitalist John Doerr: “Hire a coach!”

Google has a philosophy of hiring the best people, bringing them into a hot project, and setting them free. Google has no list of homogenized corporate leadership competencies, no formal leadership development program, and no culling of the bottom 10%. Why do that if you go to extreme ends to hire the most talented people in the world? However, Google does encourage high potentials (just about everybody) to get personal coaches.

Cathy Pacific's CoachingOurselves

Other companies, like Cathay Pacific, are experimenting with self-directed leadership development methods that smack of coaching, not the old training methods. Their Chief Learning Officer, Graham Barkus, has adopted an approach created by McGill University Professor Henry Mintzberg.

It’s called CoachingOurselves and is used for team learning. Each month a group is given a topic to learn about that has been thought through by a noted professor. For example, “leading change, by Harvard’s Joseph Kotter.” The participants come to the CoachingOurselves session, sans facilitator, having read the material and engage in a 90-minute dialogue.

The idea is for each student to reflect on the topic in light of a recent management experience and share their thoughts with the group. This leads to some very powerful and profound conversations.