HR and Business Collaboration for Leadership Development Why It Is Important and How to Make It Happen Andrea Derler, Ph.D.

HR and Business Collaboration for Leadership Development Why It Is Important and How to Make It Happen Andrea Derler, Ph.D., Leadership and Succession Research Leader, Bersin by Deloitte, Deloitte Consulting LLP Andrea MacArthur, Vice President Learning & Development, Erie Insurance

Co-presenting today: Andrea Derler, Ph.D. Lead Analyst Leadership & Succession Bersin by Deloitte Deloitte Consulting LLP Andrea MacArthur Vice President Learning & Development, Erie Insurance

Content Introduction: Andrea MacArthur from Erie Insurance Why does HR and Business Leader Collaboration Matter? Demonstrated benefits of collaboration for leadership development The Big Divide on Leadership Development How to Strengthen the Ties between HR and Business Leaders Q & A Copyright 2016 Deloitte Development LLC. All rights reserved. High-Impact Leadership: The New Leadership Maturity Model 3

High-Impact Leadership Research 2016 2,014 responses in 95 countries HR and Business Leaders Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 6

We identified 17 drivers of leadership maturity HR and business collaboration is one of them HiPo Retention Culture strength Leader Motivation Org Support Enactment of Core Values and Beliefs Clear Company Identity Communicating the Leadership model Knowledge sharing Risk taking 2 Designed Leadershi Designed 2p Leadership 1 2 Organizational Culture Matrix Structure 3 Organizational Design Clarity in Decision Making Management of Collaborative Overload Exposure as a Learning Method HR & Business Collaboration Career Mgmt Integration Business Leader Involvement Strong Leadership Pipeline Source: High-Impact Leadership research, Bersin by Deloitte, Deloitte Consulting LLP, 2016 Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 7

B e r s i n b y D e l o i t t e The New Leadership Maturity Model Level 4 Level 3 Level 2 Level 1 Systemic Leadership Exposure, Experience, Education & Environment for Leadership Development Risk-Taking Encouraged Knowledge Highly Valued & Enabled Leadership Model Well-Communicated HR & Business Leaders Regularly Collaborate for Leader Development Matrix Structures Outweigh Traditional Structures Strong Leader Pipeline for Key Positions Scalable Leadership Exposure, Experience & Education for Leadership Development Some Risk-Taking Knowledge-Sharing Becomes Important Attempts to Communicate the Leadership Model Are Made HR & Business Leaders Collaborate for Leader Development Increased Matrix Structure Existing Leader Pipeline for Key Positions Integrated Leadership Experience & Education for Leadership Development Risk-Adverse Little Knowledge-Sharing Leadership Model Exists but Not Communicated Little Collaboration between HR & Business Leaders for Leader Development Half Matrix, Half Traditional Organizational Structure Weak Leader Pipeline for Key Positions Foundational Leadership Education As Primary Leadership Development Method Risk-Intolerant No Knowledge-Sharing Lacks a Leadership Model HR & Business Leaders Do Not Collaborate on Leader Development Typically Functional / Divisional / Regional Organizational Structure No Leadership Pipeline for Key Positions 7% 18% 58% 17% Source: High-Impact Leadership research, Bersin by Deloitte, 2016 Copyright 2017 Deloitte Development LLC. All rights reserved. High-Impact Leadership: The New Leadership Maturity Model 8

High Leadership Maturity pays off Organizations high in Leadership Maturity tend to: Have 37% more revenue per employee Have 9% higher gross profit margin Source: High-Impact Leadership research, Bersin by Deloitte, Deloitte Consulting LLP, 2016 Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 9

HR and business leader collaboration helps make organizations: 5X more likely to excel at maximizing efficiency 5X more likely to excel at anticipating and respond well to change 6X more likely To excel at identifying and developing leaders 2X more likely to excel at meeting and/or exceeding financial targets 4X more likely to excel at innovating Yet, 41% of organizations report low levels of HR and business leader collaboration on leadership development Source: High-Impact Leadership research, Bersin by Deloitte, Deloitte Consulting LLP, 2016 Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 10

Benefits of HR and business leader collaboration on leadership development typically include: Source: High-Impact Leadership research, Bersin by Deloitte, Deloitte Consulting LLP, 2016 Member firms and DTTL: Insert appropriate copyright [To edit, click View > Slide Master > Slide Master1] Presentation title [To edit, click View > Slide Master > Slide Master1] 12

Polling Question How often do HR and business leaders in your organizations collaborate on leadership development? 1. Always 2. Often 3. Sometimes 4. Rarely 5. I don t know/not applicable Copyright 2017 Deloitte Development LLC. All rights reserved. High-Impact Succession Management 17

The big divide: Primary responsibility for leadership development Primary responsibility for leadership growth by HR and business leaders HR (incl. L&D) 12% 18% Business leaders 16% 41% Both HR and business leaders 37% 65% I don't know 1% 7% Other 1% 3% 0% 10% 20% 30% 40% 50% 60% 70% Business HR and L&D Source: High-Impact Leadership research, Bersin by Deloitte, Deloitte Consulting LLP, 2016 Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 19

What were some hurdles for the collaboration with business leaders on leadership development? Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 20

Potential consequences of the divide between HR and business leader collaboration Lower business outcomes Less strategic alignment of leadership initiatives and competency models Lower levels of business leader engagement in developing other leaders A lower sense of shared responsibility for leadership growth efforts Leadership Programs in a Vacuum Cost- Cutting and the Search for Value Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 21

Polling Question What are some of the consequences your organizations may have experienced as a result of low HR and business leader collaboration? 1. Less strategic alignment of leadership initiatives 2. Lower levels of business leader engagement in developing other leaders 3. A lower sense of shared responsibility for leadership growth efforts 4. Leadership Programs in a Vacuum 5. Cost- Cutting and the Search for Value Copyright 2017 Deloitte Development LLC. All rights reserved. High-Impact Succession Management 22

How HR and Business Can Collaborate for Leadership Development What HR Leaders Can Do: Reach out to senior business leaders Facilitate the constant exchange of business- and talent-related information Business Leaders MEET CONNECT HR Leaders Review and test the leadership model with business leaders Engage business leaders in teaching, coaching, and mentoring efforts What Business Leaders Can Do: Develop ongoing relationships with HR Discuss business strategy with HR partners Check in with HR before leadership development initiatives Role model leadership principles

HR and Business collaboration at Erie Insurance Foundations of ERIE Leadership Program Copyright 2017 Deloitte Development LLC. All rights reserved. High-Impact Leadership: The New Leadership Maturity Model 25

Action steps for HR and business leaders who want to collaborate more on leadership development: Define a common language Align talent processes Create accountability Engage business leaders Work closely with Human Resource Business Partner Copyright 2017 Deloitte Development LLC. All rights reserved. HR and Business Collaboration for Leadership Development 26

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