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Developing leaders and the surprising whole-company benefits

July 21, 2021 - 21 min read

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Who is a leader? What does a leader do?

Qualities of effective leaders

The importance of good leaders in your company

Identifying leaders

How to develop leaders

How to develop leadership skills: 8 strategies

Developing leaders in your business

Over generations, the definition of what makes a leader — and how to develop one — changes. 

Does a leader lead, or manage? Should all managers be leaders? For those who think they should, the next question is how to develop new leaders from the raw stuff of the workforce and under-developed managers. 

In the multi-generational workplace today, there is, no doubt, a range of definitions of what makes a good leader and how to develop them. In general, the qualities of good leadership include diligence, integrity, ethics, and empathy.

Identifying high-potentials, and focusing on developing them, has been a trend in business for years. Yet most companies still need to do more to develop the underused leadership qualities in the rest of their workforce.

Let’s take a look at what makes a leader, the value of developing leaders in your organization, and eight strategies for how to do so.

Who is a leader? What does a leader do?

In short, a leader is the person who leads.

How that works in your teams and departments might be tricky to figure out, but it is worth considering. 

Businesses are, in their own way, in the line of fire. Navigating it requires agility, and agility requires decentralized leadership

The truth is that most companies need more employees showing leadership at different levels. 

In his book Stealing Fire, Steven Kotler describes the principle of fluid leadership exercised by the U.S. Navy Seals when in the line of fire: 

The leader is whoever knows what to do next. 

Implicit for the Seals is that everyone trusts the ability of each team member to lead because of the training they've shared.

In business, we don’t always have a shared training regime. Leadership is the way we behave to earn the trust of our teams.

Qualities of effective leaders

Effective leaders have many qualities. Let’s take a close look at six of them:

1. Emotionally proficient


Emotional intelligence, emotional regulation, and high self-awareness are necessary elements for effective leaders. As leaders clarify what they stand for, their values, and what matters most to them, they gain mastery of themselves. Then they are primed to lead others by example and by modeling.

John Maxwell said, “You cannot give what you do not have.” 

Personally mastering emotions makes leaders more resilient in the unpredictable world. It is also helpful when leaders are figuring their way out of the dark.

2. Master at storytelling

Facts tell, stories sell. Leaders, like sales professionals, are responsible for selling. What are leaders selling, you may ask. Visions, dreams, and directions — all critical in today’s world. Strong storytelling helps make their selling successful.

3. Visionary

Leaders need to be able to bring people together around a vision and draw out their commitment and best work. Hence, storytelling becomes an essential skill set. This is where a strong and inclusive culture comes in.

4. Empathetic and human-centered

The present and future are strewn with uncertainty and rapid changes. An effective leader unites people and brings them safely through change, as smoothly as possible.

5. Strong coach

Kurt Vonnegut said, “I am a human being, not a human doing.” 

Leaders need coaching skills to partner and support fellow human beings. 

The new era in business is about conversations between human beings. Being empathetic to other people’s challenges can help make constant change less of a struggle.

6. Innovative

Companies perennially say they want a culture of innovation. More than having an innovative leader, that means having leaders who can draw out, support, and shape innovation from their teams. Leaders need to provide direction. 

They provide the clarity of a shared outcome that guides, motivates, and inspires. They also analyze and interpret reality.

Is the leader to determine the way forward or step aside and let the experts in their team figure out the way? 

While they might not always be as well-versed in subject-matter areas, good leaders add tremendous value in seeing connections. 

They can identify cause-and-effect, dependencies, and patterns because of their experience and approach.

An expert may bring deep expertise and innovation. A leader brings wisdom and cognitive agility, something that’s irreplaceable by technology.

The importance of good leaders in your company

Beyond a few notable exceptions, most companies view leaders as an unquestionable need. Organizations don’t need more bad leaders. 

Why are good leaders important to business?

Improve business lifespan

The average business lifespan is decreasing.

According to a 2018 Innosights report, the lifespan of S&P 500 companies is less than half of what it was in 1997 and continues to shrink. We can expect these big companies to last for 12 years or so in 2027, compared to 30 years in 1997.

infographic-average-company lifespan-developing-leaders

Good leaders can harness the creativity, innovation, and empathy of the workforce to stay connected with the consumer. This helps them stay ahead of the competition by coming up with better products and relevant solutions.

Foster workplace diversity

The workforce (and customer base) is increasingly diverse. 

Most companies face an increasingly diverse set of customer needs and preferences for value. This requires access to a broader set of talent to deliver it.

There are five generations in the workplace. Equity, equality and social justice issues are coming to the forefront of most industries.

Good leaders recognize the value of diverse experiences, skills, and perspectives. They can harness them to create better solutions for their customers.

Support young workforces

Workforce expectations have changed. The younger generations have been vocal about wanting purpose and meaning to be developed, included, and coached. 

Millennials constitute more than 50% of the workforce, and the proportion is growing. Many older workers want the same.

A leader who is empathetic and human-centered adjusts for the needs of a changing workforce amid changing conditions. They don't rely heavily on a few “tried-and-true” leadership tropes.

Good leaders respect and develop their people as unique individuals with unique needs. 

This allows them to:

  • Draw out the best in people 
  • Enable more meaningful work 
  • Inspire purpose to mobilize the whole team to work together toward greater outcomes

Identifying leaders

How do you spot a natural leader? 

First, where do you look? Internal or external, look for teams or groups that are doing better than expected under the conditions. Look for teams that seem to have loyalty or a strong connection. Look for teams that have launched many great contributors. Within these teams, someone is doing something right to make the whole more than the sum of its parts. 

Within these teams, look for the signs of behaviors that support trust, productivity, and engagement in others:

Empathy and compassion

How do they engage with others (peers, those who report to them and their line managers, skip-level managers, and stakeholders)? 

Look for indicators – in speech and action – that they:


  • See various perspectives 
  • Understand differing motivations 
  • Think about benefits for all 

Natural leaders don’t just recognize different needs but also coach or mentor others to help them get what they need.

Emotional regulation

How do they perform under stress, short timelines, and complexity? Do they try to keep their cool and stay solution-focused and forward-looking? Natural leaders try to give others a sense of clarity or security amid uncertainty. 

Effective listening and observation

How do they communicate? Do they try to include everyone, creating common ground, fostering goodwill and understanding? Are they using language that unites or divides? Do they seem sensitive to the room, knowing when to challenge and when to step back? Natural leaders navigate the unseen and try to defuse high tension situations.


Do they demonstrate executive skills like: 

  • Self-management 
  • Managing competing priorities 
  • Adopting zoomed-in and zoomed-out perspectives

Can they let go of perfection in favor of completion? Natural leaders know that different situations require different approaches. 

Systems thinking 

Do they exhibit good thinking, discernment, and understanding of the complex system? Natural leaders are observant and comfortable with grey areas and try to see how details affect the bigger picture. 

Humility and growth mindset 

Are they willing to learn from others and change their position when new information emerges? Natural leaders recognize how much they don’t know.

How to develop leaders

It should be obvious by now that leaders aren’t just born and there’s no single leadership mold.

We all have leadership potential in certain circumstances. In a complex world, companies need different types of leadership.

With opportunities and the right support, future leaders will emerge from everywhere. 

How to develop leadership skills: 8 strategies

Let’s take a look at eight strategies you can use to foster leadership skills in your team, creating leaders at all levels:

1. Coach and mentor 

Leaders of today must bring a coaching mindset

New leaders will benefit from a senior leader who can act as an example.

While working with leaders from a different generation, bear in mind that the motivations are different. 

Even the definition of leadership may differ. Ask open questions from your potential leader. Discuss what good leadership means and what behaviors point to that.

Share your experiences and perspective to add color and depth to the discussion.

Link your discussions with the demands of the role, how leadership can show up as the potential leader carries out his day-to-day duties. This type of coaching will help the potential leader gain confidence and maturity and be ready for a bigger role when the time comes.

An example of a great leader who acts as a coach is one who supports employee engagement by allowing their team members to explore new ways of working. They don't simply dictate how work needs to be done. 

An effective leader here will see their mentorship as part of the development process of each of their staff. They will hold a conversation with the employee to analyze the effectiveness of the method they chose to use. 

A successful leader will allow the employee to learn from experience rather than being told what to do.

This is the difference between being a coach and being a manager.


2. Anchor in values and meaning

What makes some leaders better than others seems intangible. It comes from the coherence of the leader's actions and words with their own and the organization’s values.

Talk about your own core work values and how you manifest them. Encourage the new leader to explore their values. 

It isn’t always easy to make the connection between what we believe and what we do. Make values part of the conversation throughout a leader’s development.

For example, imagine an emerging leader places a high value on honest conversations, at work, and at home.

This can be a great opportunity to engage said future leader in a development program that fosters this leadership style.

3. Emphasize personal growth and soft skills

New leaders focused on developing management skills can become overwhelmed. 

To help combat this, amp up “soft” skills and creativity. Creativity helps leaders solve problems and turn challenges into opportunities.

Part of your leadership development plan should therefore include: 

  • A stocktake of the soft skills and leadership qualities that your aspiring leaders have 
  • The areas where they can improve the most in 
  • An action plan for developing those specific skills

Perhaps pair them up with current leaders who are strong in the areas that the aspiring leaders lack.

4. Debrief and reflect

Guided discussion and reflection can draw out and consolidate learning. With the execution and completion of every project/task, have a discussion with the potential leader.

Often in a corporate setting, employees are preoccupied with conquering challenge after challenge.

There are many learning points from challenges that went well and ones that didn’t go so well. The learning would be lost, or be accidental, if the process of reflection is not led.

This can be as simple as having everyone in your company in a leadership position put aside 15 minutes per day to reflect on their leadership effectiveness that day. This information can be collated and discussed as part of your leadership development program.

5. Ask about aspirations and design stretch assignments

Check in with the potential leader about how he would like to grow his career. As the motivations of younger leaders are different, what a more mature leader perceives as ‘success’ and ‘growth’ would be different.

Engage the potential leader in conversations and design assignments that help him grow in the direction that will be a win-win for both employee and organization.

For example, let's say someone in a leadership role in your company wishes to one day start their own company.

Part of your leadership development strategy might be getting this person more involved in the development of organizational goals. This could include inviting them to attend management meetings. 

These actions then are more connected to their long-term goals outside of their current role.

6. Give constructive feedback informally and regularly

Research has shown that the fixed cycle of formal conversations does not work. Employees now want to be involved and developed, making informal, regular feedback more effective.

Watch your leader and look for opportunities to reinforce positive leadership behaviors. Do this more so than looking for opportunities for correction. Describe specifically what made their behavior good, so the leader will know what to replicate in the future. 

Vague comments will often get misconstrued due to different biases and upbringing. Do not shy away from giving critical feedback — it might just be the feedback your potential leader needs.

Rather than saving feedback until you meet for leadership training, aim to give feedback as you think of it.

This can be a simple message via email or Slack or when you pass an individual leader in the office.

7. Create an open channel to ask for support

Some leaders give stretch assignments that are too far beyond the abilities of the employees. One question to ask yourself is, “Am I setting up my employee to succeed or to fail?”

Giving tasks that are too difficult without the right support can be demotivating and have costly consequences. In academic learning, there is a zone of proximal development that makes learning enjoyable and attainable. Apply the same principle and provide appropriate support. 

Check in with the potential leader often and ask what support is needed. Be accessible so that your potential leader can thrive and grow.

8. Offer executive coaching to develop presence and confidence

Leadership, even when unconventional or service-oriented, is often highly visible. 

One of the common challenges for leaders is not being ready for a bigger role when the opportunity finally comes, sometimes years later. 

Individuals who have been ambitious and motivated in their work may still lack the benefit of thoughtful processing. This would help them make meaning and consolidate learning from past experiences.

Coaching will support potential leaders to grow in their leadership to be on par with the expectations of their role. It will help them develop both their presence and confidence.

The best investment an organization can make is to invest in its people. 

Developing leaders in your business

Developing leadership skills takes time, and it can be costly to your company. However, it’s an investment in the future of your organization and one which you’ll reap the benefits of for years to come.

At BetterUp, we love helping new leaders grow and transform. Find out more about how we can help you foster leadership skills in your company here.

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Published July 21, 2021

Chuen Chuen Yeo

BetterUp Fellow Coach

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