An estimated $14 billion is spent every year on leadership development in the US. Yet, according to McKinsey, most leadership programs fail.

We believe this is because leadership development is misunderstood, misapplied, or outright ignored. Few have the time or know-how to deploy effective programming amidst the tyranny of the urgent. Hitting budgets, closing deals, tracking KPIs – these demands can overwhelm even competent leaders; and therefore, the space to address leadership development remains neglected. Even if a leadership program is rolled out, it almost certainly lacks dimension. Most programs either skew too reflective or too generic and playbook-driven. Neither approach addresses the complexity of leadership in today’s hyper-competitive, increasingly volatile environment.

ParkerGale answered these challenges by partnering with Wind + Sail Leadership Partners to bring an effective, engaging, individualized, and repeatable program – one that made sense for growing private equity-owned businesses and would “stick” long after we are gone. It’s called L6.

Since rolling out the program at several portfolio companies, we have seen a meaningful increase in leadership maturity throughout the organizations. Teams are drawing on the skills and relationships built in L6 and are transforming their companies with renewed agility, growth, and innovation.

Introduction

Why invest in leadership development?

A few years ago, the ParkerGale team asked the CEOs of their portfolio companies a simple question – what issue within your organization can we help you solve?

One of the requests was unanimous: “leadership development.”

CEOs were moving so fast they didn’t feel like they had the time to train and develop leaders. They resorted to hiring leaders from the outside as the solution, but hiring great management teams is not enough. Sustained success requires investment in internal leadership development.

Although both investors and executives are paying more attention to their talent strategy, the effort focuses on the top (investing in a small number of C-Suite leaders) and the bottom (managing out under-performers). ParkerGale’s goal was to direct more attention to the missing middle; the 60-70% of leaders in middle-management that oversee most of a company’s employees, do the heavy, day-to-day, operational lifting, but who receive little development. These are the leaders who shape a company’s culture. And we believe that culture, in turn, shapes organizations.

Wind + Sail’s philosophy holds that building communities of evolved, mindful, and skillful leaders creates a competitive advantage culturally and financially. Doing so requires strategic attention and action. Their approach immediately resonated with the ParkerGale team – avoiding the light touch and bromides of typical programs, L6 was thoughtfully constructed, providing both the depth and practicality that ParkerGale was looking for.

Together, we partnered to bring the L6 program to the portfolio. Today, L6 is one of the core investments we make across the portfolio.

Read on to learn what, why, and how we do what we do. We also share specific results that we believe any mid-market company can achieve if they commit time and resources to the effort.

Part I: Leadership Development’s Uphill Battle

Harvard Business Review calls leadership development “the job that’s never finished.” The task of training leaders always changes because of continual shifts in how leadership is defined – and what companies need from managers. To be effective over the long-term, development programs must get personal to re-shape how leaders think, view others, and innovate.

Why most programs fail

Most mid-market companies under-invest in leadership development. Those that do invest are generally incomplete in their approach; the occasional HR-led offsite, guest guru, or lunchtime training is unlikely to change behavior.

We find that programs fail in one of two ways:

• They’re too theoretical, guiding leaders into introspective states but never helping them re-emerge to a place of application. Their impact is pleasant but fleeting.

• Or, they “get right to it” – favoring tactics over deeper self-leadership. Skills-only programs ignore the complex personal dynamics that affect work. Therefore, culture and chemistry are difficult to improve.

Both approaches are incomplete.

How we “do leadership” must change

Leading in a VUCA world

The events of 2020 are a stark reminder: the world is more VUCA (volatile, uncertain, complex, and ambiguous) than ever before. But responding with hard-driving efficiency and productivity, rather than empathy and vulnerability, actually erodes leadership effectiveness. In this new norm, the most effective leaders will be self-aware, agile, and empathetic.

Many approaches to training leaders are playbook driven; but when the game changes entirely, leaders are not equipped to lead. Change makes most people contract. It causes analysis paralysis – stifling creativity and fueling office politics.

Private equity-backed technology businesses, where complex teaming and innovation are daily requirements, need nuanced leadership. Managers must be nimble, guiding experimentation and adaptation, while determining the right balance of trust and empowerment. Heavy-handed control will not deliver results, particularly in times of chaos.

Millennials’ expectations

Workers under forty have wildly different expectations of management compared to their predecessors. PwC notes that millennials “[…] relish the opportunity to engage, interact, and learn from senior management.”

They value an active coaching style of management versus the traditional hands-off approach. In general, they require “very regular feedback and encouragement.” For managers accustomed to rigid corporate structures, this is can be challenging. Yet, millennials’ loyalty and engagement are tied to satisfaction around these dimensions. Ignore these expectations at your own peril.

Part II: The L6 Program

The L6 design represents a shift in approach that addresses these needed changes. Foundational to the approach is a focus on developing communities of leaders to become more:

• Evolved: Evolved leaders guide themselves and their teams through complexity with courage, creativity, and confidence. They are maturing through the stages of adult development and building the ability to thrive in gray areas. They lead from a place of self-knowing that gives them the assuredness to see beyond constraints and drive innovation.

• Mindful: Mindful leaders understand how their thoughts (and resulting actions) affect outcomes. They temper reactive impulses. They account for subtle, situational cues – and pause, reflect, and make choices with the broader picture in mind.

• Skillful: Skillful leaders have command of proven management practices. They effectively apply feedback, delegation, collaboration, conflict resolution, and other management frameworks to get the most from their teams.

We work with leaders to develop these capabilities during six, full day, in-person training sessions and through 1-on-1 leadership coaching sessions woven throughout the program. Coaching is informed by the data we capture from The Leadership Circle 360 assessment tool, as well as each individual’s particular needs as the program rolls out.

Below, we discuss the program’s organizing principles and each L6 module.

First, we begin with a thoughtfully constructed community of leaders.

Depending on the size of the company and its structure, we expect that the leaders in the L6 program will have about 60% to 80% of company’s employees reporting up to them. The cohort should represent a diverse cross-section of company leadership, chosen by, and potentially including, many senior executives. As well, it may include individuals without direct reports but with broad, functional responsibilities.

One litmus test to use when determining who should participate: do these leaders have an outsized impact on the momentum, energy, and culture of the company?

Then, we embark on the learning journey.

True leadership is as much about 'being' as it is about 'doing.’ Yet most leaders are focused on ‘the doing.’ This is, after all, how many get ahead. If they are great doers, they get promoted to manage more doers. In that ascent, leaders must also step back to assess their leadership style, the impact of that style on others, and their long-term impact.

Early in the program, we emphasize vulnerability through experience sharing, connection to purpose, and values exploration. This is the foundation on which tactical learnings are built in later modules. The L6 modules are:

• L1 – Purpose-Centered Leadership: This module creates the conditions for the cohort to grow as a connected community and hub of mutual learning. After establishing our shared commitments, we begin to explore purpose through the lens of individual values. We know leaders are most confident and resilient when they know who they are. The activities create meaningful connections and help individuals understand themselves more acutely. Some of the most poignant moments occur when participants share personal histories with one other. Leaders emerge with tools for purpose-centered leadership and a vision for their growth.

• L2 – Strengths & EQ: This module uses various models that uncover strengths to identify a leadership “brand.” Leaders experience a powerful ‘a-ha’ as they understand their team members’ key strengths (as well as their own!) and purposefully match these strengths to the team’s work. By exploring emotional intelligence, participants also learn to spot and transcend reactive triggers and discover how to elevate self-awareness, productive mindsets, and better manage workplace relationships.

• L3 – Inclusive Management & Delegation: This module identifies mindset and action shifts to reduce unconscious bias and increase inclusivity. Leaders also emerge with a deeper understanding of management tools like delegation and work distribution, connecting work to vision and purpose, and generating team motivation. Even senior leaders discover new depth in a simple tool like delegation.

• L4 – Feedback & Coaching: This module builds team leadership capabilities by focusing on coaching skills and delivering feedback. We emphasize leadership presence, active listening, and powerful questioning. Role-playing feedback scenarios customized for the organization helps leaders master these skills and lead through difficult conversations. After the session, leaders are relieved to learn that they do not need to have all the answers. Instead, they learn to deploy coaching tools to guide their teams in the right direction.

• L5 – Peak Performance Strategies: This module draws on the science of sustained high performance, neuro-leadership, energy management, habit formation, and goal setting to share strategies that help leaders improve their performance and thrive in their roles. Coming out of this session, leadership teams will often tear up their meeting models – restructuring their weekly schedules to eliminate useless meetings, add time for deep work, and ensure maximum meeting productivity.

• L6 – Setting Sail: This module crystallizes practices from the prior sessions and translates new learnings into conscious ways of operating. Small groups put together “re-teaches” of critical concepts taught throughout the program. This begins the process of making the learning their own. Later, each leader writes a “Leadership Statement” that describes who they want to be and what change they want to bring into the world. The focus is on individual, cohort, and organization-wide impact generated throughout L6, as well as commitments, accountabilities, and setting the vision for a transformed future.

Each of these modules represents a full day onsite. We recognize that participants learn in different ways, so we also apply a variety of learning modalities throughout the program. These include auditory, kinesthetic, visual, and action-oriented elements. In this, we are careful to honor the discussion and reflection habits of both introverts and extroverts.

Throughout, we connect individual development needs and encourage practice through one-on-one executive coaching.

Coaching starts with an “x-ray” of participants’ leadership capabilities captured through an upfront 360 assessment. We find The Leadership Circle Profile provides useful feedback and adds powerful insights for goal setting and future growth. Participants each set two leadership development goals which become the focus of coaching sessions. The goals connect with the professional development goals they already focus on within the standard performance review process.

The coaching also helps participants create individualized fieldwork and go deeper on the parts of L6 on which they want to build. Coaching truly is the secret sauce. With a coach, participants can translate the richness of the program into what is most important for them.

For many managers, this is their first experience with executive coaching. They find the combination of the program and coaching reinforcement is what makes L6 transformative.

Thereafter, we support leaders as they embed new behaviors into the company’s culture and everyday processes.

Without plans to build leadership development competencies into the organization’s way of doing business, programs fail. One way to improve success is to introduce competencies like emotional intelligence, coaching and feedback, and communication into the annual performance review process. Another way is to absorb these skills into hiring and promotion decisions by expanding interviews to include questions that reveal a candidate’s aptitude in these areas. While no one will possess each skill, they should at minimum have the capacity and willingness to learn.

Most important are ongoing opportunities for real world application after the program ends. Leadership, like any skill, requires practice. We recommend cohort captains organize bi-weekly or monthly lunch meetings where participants workshop real issues together. The repetition trains the skills and helps them stick. Participants revisit L6 concepts and connect them to current management challenges. Over time, these competencies become second nature.

There’s a powerful relationship between culture, language, and practice. When companies start to lead, communicate, interview, assess, and reward on the leadership competencies learned in L6, culture begins to change.

Part III: Program Outcomes

Measuring L6’s impact

Qualitative performance improvements

Based on feedback from program participants and executive sponsors, we find significant transformation inside of the organization. Here are a few highlights:

First, the program builds relationships across departmental silos. After going deep and getting vulnerable in six sessions together, leaders get to know one another and develop clearer perspective of the organization. In some cases, false assumptions inhibiting collaboration are discovered, and relationships mended. In all cases, leaders foster these new relationships forged during the six-month journey, supporting one another as they practice a better, more evolved style of leadership.

Another critical outcome is a cascade of corporate purpose, values, and strategy. By bringing in senior executives to talk with L6 participants throughout the program, we create space to explore sticky questions around vision, strategy, or company change. Not only does this bolster trust and opens lines of communication among leaders, but it gives participants the confidence to cascade key messages down throughout the organization.

Additionally, our CEOs notice that L6 “turns up the heat” on senior executives. As managers progress through the program, senior leaders feel an urgency to ‘lead better’ so they are not upstaged by the newly empowered managers. This builds a virtuous cycle of continuous improvement.

Finally, participants share that L6 positively changes their work experience. They report more connection to purpose and an improvement in relationships – both inside and outside of the office.

Quantitative performance improvements

Private equity thrives on data, results, and accountability. So how have we measured the success of L6 so far? We stack rank portfolio companies who have rolled out L6 against those who have not yet. Across a variety of key portfolio performance metrics, program participants make the biggest leaps forward.

Notable results from the portfolio companies with whom we piloted the program:

• 89% Net Promoter Score (NPS). For reference, Apple’s is 72%.

• Self-reported growth of at least 20% (and up to 40%) in key competencies, including delegation, emotional intelligence, connecting work to the company’s purpose and strategy, and situational leadership.

Additionally, we use CultureIQ, a leading cultural assessment platform, to measure the program’s efficacy. Although still early in our roll-out, L6 participants note progress in dimensions of dignity (e.g., “My supervisor treats me with respect”), collaboration (e.g., “I see cooperation across different departments”), and agility (e.g., “In my work group, we implement changes quickly”).

Closing Thoughts

Managing in a private equity-owned company is not for the faint of heart. There are 100-day plans, tight timelines, steep growth targets, and demanding investors. Leaders must manage these demands and find time to develop new products, hit aggressive financial targets, enter new markets, and execute M&A strategies.

Navigating this with grace takes evolved, mindful, and skillful leadership. It demands organizational agility to plan for the future and implement changes quickly, not just from the Chief Executive’s office, but from all leadership levels. Developing this type of leader and organizational mindset requires a shift in how we approach leadership development. The L6 approach offers a solution that works.

We often say, “leaders set the weather.” This means leaders powerfully shape the environment we operate in, which over time, shapes organizational culture. In our increasingly volatile and uncertain work world, the shaping of culture, and therefore outcomes, is achieved through daily actions – both in what leaders do and how they show up in the process. When leaders are developed holistically, they become able navigators who calm the choppy seas of change and guide the organization forward. Only through their individual and community transformation, can the organization realize true transformation.

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