Even at 70 years of age, Bill Byham isn’t thinking about retiring just yet. It’s not surprising, as the title of Byham’s latest book, his 22nd, is “70: The New 50.”
That doesn’t mean that Byham, chairman and CEO of Development Dimensions International Inc., hasn’t given the subject of retirement a lot of thought. His focus, however, isn’t on choosing the location of his post-career home, travel to exotic locations or where the best golf course communities can be found. It’s how retirements are going to affect the upper management echelons in his company.
“I’m not planning on retiring for another five years or so,” Byham says. “The other people, as I said, are just getting to be 60, so they probably have another five years or so. So we’re in pretty good shape that way, but jobs are opening up. We’re very international, so we’ve got all this international expansion sucking up good talent. And so I want to make sure we have a continuation of progress within the company.”
According to Byham, filling top leadership positions in the future is the key challenge that faces the growing human resources and training company, which posted 2006 revenue of $155 million, up from $129 million in 2005.
Byham didn’t start thinking about the issue this year. His ideas about it began to gel when he spent two years researching and writing another book, “Grow Your Own Leaders,” which was published five years ago. The ideas in the book, principally revolving around the notion that developing leaders within a company is vastly superior to bringing in leadership talent from the outside, are the blueprint for how Byham and DDI are grooming the company’s future leaders.
“I must say it’s such an obvious thing if you look at the cost of going outside and the time that it takes you. It’s just so obvious that you’re better off to grow your own people,” Byham says. “It takes people a year to catch onto the company. It’s a fairly complicated company, what we do and everything. It’s a huge amount of wasted time where nothing’s going to happen.”
Byham’s solution is to create and develop an acceleration pool. In DDI’s case, it’s a group of about two dozen talented employees who can be trained and provided the work experiences that will prepare them to assume the top leadership positions in the company as they become available.
“What I believe is that there has to be a few people that you rapidly accelerate their development, and the point is, ‘Who are they, and then what do you do about it after you pick them out?’” Byham says. “And so we started a process five years ago a formal process, you always have an informal process but we started a formal process of identifying the people who would benefit most from accelerated development. It does not mean that they’re our best and brightest. They sort of are, but we have some of our best and brightest already in a wonderful development job that we couldn’t think of anything better to do with them than to leave them where they are. But there’s a whole lot of other people who we could change their job, change some of their assignments, give them some new responsibilities, plus give them the training faster.”
While DDI’s acceleration pool may not look much different than similar models at other companies, Byham says DDI’s is successful because it knits together training, varied experience in different jobs designed to develop and stretch the candidates’ skills, and mentorship to monitor their progress.
Rather than putting promising employees through a linear sequence of job experiences, Byham’s approach is to look for ways to combine the training and job assignments to speed the preparation.
“It’s a modern way of thinking about it,” Byham says. “It used to be that they had high-flier pools or high-potential pools. Someone right out of college or a few years out of college would stay in it until they got to be a middle manager.”
But Byham says that model doesn’t work because some people are slow bloomers or enter the work force later in life.
“So my vision of the pool is like a moving spotlight, and the spotlight is passing over all of your employees, and there are a few people in that spotlight at one time, and they are the people who are getting this special boost to their development.”
Forming the pool
Byham’s first step was to determine who should be in the acceleration pool, a decision made by gathering nominations from senior managers and collecting data on the nominees.
“We had a multiple system of nominations, and then very carefully we collected all kinds of data on people who were nominated, and then had big discussions on who would be good candidates,” says Byham. “Then we put them through an acceleration center, which is a fancy assessment center.”
The acceleration center, a kind of job simulator, puts the employee through the paces of what a typical job might entail, posing problems and having them make decisions and interact with people in ways that they might in that particular job. The purpose of the acceleration center is to determine what the individual’s development needs are.
“So we select these people and put them through this acceleration center, and it diagnoses their development needs in terms of the competencies they need, in terms of the experiences they need, the job knowledge and the personality attributes they need,” Byham says. “The third step is to have a really good program to do something about it. Too many people do the first and second, but then don’t have good follow-up. So we built in all kinds of systems that force action on the part of our people.”
All of the collected data is then used to determine what kinds of job experiences the candidate should have that will provide maximum learning and help them to strengthen or acquire skills where they may be lacking.
“So the ideal job would be, ‘This person has never had international experience,’” Byham says. “We feel strongly that everyone should have some international experience. So the ideal job would be a job in international operations. Maybe it brings in more finance because he has never had that experience in this company and that would provide him with the opportunity to lead a multinational team because he has a weakness in team leadership. On top of that, he has a tendency to jump to decisions too fast, and this would be a chance for him to work on that personal attribute. So we’re never trying to kill one bird with one stone, we’re trying to kill four birds with one stone or more. So the creativity comes in thinking of all the options.”
The role of mentorship
Byham pairs each candidate in the pool with a mentor who is responsible for ensuring that the candidate is getting the training and the job experience he or she needs to continue to develop his or her leadership skills.
“The mentor’s job is not just to pass on their knowledge or contacts or information, but the mentor’s job is to be sure that the individual and the individual’s boss are working together to develop that individual so that they are challenged, that they move as fast as they can from one job to another,” Byham says.
The judgments about the individual’s progress are based on the individual’s actions and the results they produce.
“All of DDI is built on behavior, so we’re not interested in, ‘Well, he tries hard, he’s got good judgment,’” Byham says. “We force everyone to authenticate that by saying, for example, ‘He did this, he said that, he accomplished this.’ So the whole thing, everything I was talking about, is built around behavior and results.”
While DDI’s commitment to training is substantial, Byham says the most important learning comes on the job.
“I’m in the training business, but I guarantee you that if I ask you what made you great, you’re not going to say I went to this training program,” Byham says. “It’s going to be [that] you were put in a job that was a big stretch and you had to do things you never thought you could do, but you had a good coach to help you and you succeeded. That’s what made you a good executive. So our job is to set these systems up so the people who will benefit most will get into those jobs and will be able to grow.”
Byham says the key to making the acceleration pool successful is a full commitment from top management. Byham himself serves as mentor for two members of the acceleration pool.
“We spend 10 days a year on this subject,” Byham says. “That’s a big commitment, and that’s not counting the individual time when we are coaching. I’m talking about the communal time when we’re discussing the candidates, figuring out as a group what we ought to do at a senior level. We discuss everyone in the pool, and their mentor makes a report: Here are the person’s developmental goals, here’s what the person’s done and so the question is, ‘Do we leave them in that job? Are there other developmental goals that could be met there, or should we move him to another job, which would be a better place to develop the skills he or she needs?’”
Without the approach that DDI has taken to develop its people, it might have survived, but it wouldn’t have the rich supply of talent that it has assembled to draw from, and its potential to grow could have been stunted, Byham says.
“We wouldn’t have as many people from which to choose, and the No. 1 truth about selection is the quality of the selection decision is very much dependent on the number of applicants that you have,” he says. “If you just have a few applicants, you end up compromising and taking one that you think will do but is certainly not optimal. Now we have a much richer pool there from which to choose, and I will guarantee you that will make us make better decisions, and they will be able to go off running faster because of the kinds of training that they’ve gotten.”
HOW TO REACH: Development Dimensions International Inc., www.ddi.com