Where will you find the next generation of leaders for your organization? Within your organization, do you know who the potential leaders are? Will you promote someone without knowing whether he or she will be able to successfully make the transition from individual contributor or manager to corporate leader? If not, do you know how to attract, select and hire people from the outside who have the leadership qualities that are required to meet your business objectives? With the appropriate effort and knowledge, identifying potential leaders can be a straightforward process that is critical to organizational success.

Define characteristics

Identifying leaders is not about simply reviewing a performance appraisal and making a selection based upon what the individual knows or does not know about getting the job done. Just because someone excels in a functionally specialized role - say, as an accountant or a computer programmer - does not guarantee that he or she has the qualities to effectively lead an organization from an enterprise-wide perspective. Leadership requires significantly more than functional and technical skills. It requires an ability to:

• Adapt to changing and ambiguous situations
• Build and motivate teams
• Implement a strategic plan
• Lead an organization

Whether promoting from within or recruiting externally, the first step in identifying future leaders is to clearly define what characteristics your organization is looking for in its leaders. Develop a list of competencies and characteristics that you consider essential for successful leadership. In addition to the above, such a list will typically include high-level attributes such as "ability to develop vision and strategy," "creativity and innovation," "willingness to take risks," and "ability to make and implement decisions."

Inside or outside?

The next challenge is to find out which people in your organization have, or could develop, the attributes identified in the first step. To do this, you must boil down high-level concepts such as "creativity and innovation" into concrete observable behaviors that demonstrate leadership potential in individual employees. For instance, a person may display an "ability to form strong relationships" by securing a long-term deal with a previously inaccessible vendor or distributor, or someone who is "creative and innovative" might think of a new, more efficient way to manage an e-mail distribution list. Look for employees who succeed in new and different situations, put in more than the minimum effort on routine tasks, and come to their supervisors with solutions rather than problems.

If you are lacking potential leaders internal to the organization, then you will need to recruit and hire for those qualities. This provides a greater challenge as you will need to determine leadership potential in an interview as opposed to being able to gather information from internal resources. During the interview you will need to probe those characteristics identified by the organization as critical for all leaders. To do this, you need to craft questions to get at the candidate's ability to adapt to new situations or build teams and motivate others, and you need to probe responses to understand why they did what they did, what they would do differently, and what they learned from those experiences. It's not about asking how many people they have managed but about understanding how they manage those direct reports, what they do well, what they could do better, and what they have learned from that experience.

When assessing a candidate's potential leadership ability, think about the types of experiences they have had. Individuals who are constantly trying new and different things (both within the work environment and within their personal life) are more likely to be able to lead and inspire others.

In addition, think about how they responded to your questions:

• Did the candidate compare and contrast experiences?
• Did the candidate talk about making transitions or shifts in opinion based on experiences?
• Did the candidate discuss mistakes and how they learned and adapted from those mistakes?
• Did the candidate talk about approaches taken, why they chose that approach, and what they would or could do differently?

When candidates discuss candidly events and experiences, whether business or personal, and how they learned, changed and adapted to those situations, it indicates their ability to adapt to different environments and experiences. Based on the research from the Center for Creative Leadership, "The ability and willingness to learn from experience is the number one predictor of success."

Cultivate talents

Once you have identified potential leaders, you can then proceed to cultivate and enhance their talents. This process is largely a matter of comparing a person's current capabilities with the identified set of desirable leadership characteristics, then targeting development to fill in the gaps.

There is no question that finding and keeping leaders requires a significant investment of time, effort, and money. But that investment may well pay off significantly when your company needs to find a top executive who is both well acquainted with your organization and capable of steering it through its immediate and future challenges. By identifying the leadership characteristics required to meet business objectives and either promoting from within or hiring external talent, you can proactively cultivate the resources most critical to your success: your future leaders.

Kate Kessenich Bett is managing director of BettSolutions, an Associate of Lominger Limited and is also a NEHRA member. She can be reached at (508) 529-6184 or kate@bettsolutions.com.