Every year millions of business leaders spend days, if not weeks, collaborating with their peers to develop a strategic plan for their company to execute. Goals are set, tactics are outlined, and information is cascaded to all levels of the organization. If done properly, each department and each person understands their role in the plan, and throughout the 12 months that follow everyone strives to do their part.
However, in doing so, they hitch their personal development to the company wagon.
Without a separate strategic plan for themselves as individuals, they unwittingly limit their development to the skills required to achieve the goals of their employer. Most don’t think about or realize the limitation because their employer usually acknowledges and rewards them for their efforts. Therefore, their development feels like an accomplishment not a limitation.
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April 1, 2022But here are 4 reasons why the company-prescribed linear path isn’t enough for the individual or the company.
REASON #1: White Space
Great companies build growth strategies around the opportunities that their existing infrastructure affords them. If every team member develops only in ways and at the pace that their employer’s goals require, then the organization’s growth is limited to the plans that are laid each year.
However, if team members are developing with their own momentum, previously unplanned opportunities can be immediately seized. There are no crystal balls, so growth-focused organizations need untapped talent on their bench if they want the corporate agility that unplanned opportunities require.
REASON #2: Stronger Partnerships
When potential business partnerships or joint ventures are being contemplated the due diligence should and usually does include an asset assessment — and people are every company’s most valuable asset. The very nature of new partnerships means growth and change. Both sides of the equation want to know that the other side has the existing talent that the venture requires. Imagine how quickly a new business relationship would crumble if the strategy was initiated concurrently with the personnel development required to execute it.
REASON #3: Marketability
Individuals are more marketable when their skill set advances with its own momentum. Fortunately, they also add marketability to the company itself. Most business owners have a planned exit strategy that usually involves a merger, an acquisition, or possibly going public; and all 3 require an investment from outside the company.
Investors always expect growth in addition to a return on their investment. Potential shareholders may not examine employee development prior to buying Apple or Amazon stock, but venture capitalists look for companies that have growth opportunities and a talent pool to turn those opportunities into profits.
Untapped talent means additional revenue opportunities, and that’s like ringing the dinner bell for hungry investors.
REASON #4: Succession
Succession planning is always a fickle challenge. As businesses mature so does their leadership. More often than not, members of the existing executive leadership team are all very close in age. When they begin to hit the retirement horizon a difficult problem arises: promote from within or hire from without. Hiring externally is always a gamble, and studies have shown that it is more cost-effective to develop your own leaders.
A study by the Wharton School of Business showed that hiring externally costs 18%-20% more than promoting from within, and performs worse — at least in the first 2 years.
A Harvard study showed that replacing a CEO with an external candidate results in an average performance drop of 6%. New faces come with unknown consequences, and culture is binary; someone may look good on paper but a C-Level exec who is culturally inconsistent with the company can have catastrophic consequences, especially in smaller organizations.
If you are serious about growing your business, every person on your team needs a strategic plan for their own development that is separate from and exceeds the company’s current needs. It is important that each person develop their own plan; it should not be made up of additional expectations prescribed by the company.
However, the company should set parameters for what is included in each person’s plan.
• For instance, every person’s plan should include both hard and soft skills. At least one of their personal development goals should be a hard skill that is unrelated to their current duties.
• The plan should also include short and long term development goals. For example: with enough practice, it may only take a few months to become a better public speaker, but it may take years to speak in another language.
• And finally, every person’s plan should include at least 1 goal that builds upon his or her previous plan.
While not too prescriptive, parameters like these assure development breadth and depth.
We spend a lot of time developing plans for our businesses. And to be fair, most of us work hard to facilitate people development as well.
There is a difference, however, between working hard to facilitate something and having a tangible strategic plan that includes tactics and measurable outcomes. The former shows that you care about your people. The latter shows that you recognize personal development is the linchpin for success.
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About the Author: Tra Williams is a speaker, business consultant, and author of the book Feed Your Unicorn. He is a nationally recognized thought leader in small business, franchising, leadership, and entrepreneurship. Tra works tirelessly with people, professionals, and organizations to help them define success on their own terms and build the framework required to sustain it. For more information, please visit https://trawilliams.com/.