Having the right leaders in an organisation obviously makes positive difference. But did you know that having leaders with the right competencies can dramatically affect the bottom line? And we’re not just talking revenue growth here, we’re talking profit too (that’s going to keep the shareholders happy).

DDI recently conducted some in-depth research, analysing over 1000 senior executives. They identified a small set of skills that great leaders possess, if they are to drive revenue growth and profit. We call these “the money skills”. The specific business and leadership competencies that drive profit are:

Entrepreneurship – crafting plans and capitalising on market opportunities

Business savvy - quickly and accurately sizing up the merits and risks in complex business scenarios

Driving execution - devising specific plans and organising people to achieve strategic objectives

Decision making - making effective day-to-day judgments about short-term issues

Leading change - identifying the need for organisational change, and effectively leading people through it

In short, highly competent executives who demonstrate these money skills drive more profit and revenue —by as much as 45 percent.

So what can we learn from this? When it comes to development within your organisation what should you be looking for and where should you begin?

  1. When it comes to selecting top executives use simulation based assessments. There’s no guesswork when it comes to how they’ll perform.
  2. Research has shown that the most profitable companies had leaders with wide-ranging skills. A few talented leaders cannot compensate for a large group of mediocre ones.  
  3. Start developing these “money skills” at lower levels in your organisation. Your top leaders aren’t born with these skills. They’ve been honed and developed through experience and challenges.
This short post is part of an ongoing series on High Resolution Leadership. The original report can be found here.   Louise's article on LinkedIn can be found hereLouise Green can be contacted here.

 

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