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The untapped potential of informal leaders

This article was first published in Management Today

Recruiting and developing leaders is enormously important to the future health of an organisation, so it’s no wonder that the leadership development market is worth tens of billions of dollars and is growing at 15 per cent annually. 

Despite this, significant numbers of executives are dissatisfied with these leadership initiatives. One reason is that much leadership development has become generic and people do not understand how it relates to them. What it takes to be a leader in a Silicon Valley software business is not the same as what is required in Italian heavy manufacturing.  

The problem with these programmes is that they ignore the qualities needed for organisation specific leadership and the particular value of ‘informal leadership’ that is found deep in a business but which is often taken for granted. 

Informal leaders are people we all know, respect and could point out if we were ever asked. They are people we instinctively look to for support and guidance when difficulties arise, and not because of their role or job title. They demonstrate leadership by getting things done, getting the best out of colleagues and by challenging people to do more. 

These are the people who stay after hours to help a colleague get a client order out the door, or literally hold their tool box as they maintain a machine, or work alongside a skilled colleague to help them innovate and experiment.

Given the capability of these informal leaders, it is surprising that businesses don’t use them more. Yet there are a number of steps they can take to make the most of, and learn from, these critical people. 

Find the informal leaders

The first is to recognise that informal leaders can be hard to find and are not always the people you would expect. Second, they often do not realise they are doing anything particularly special or different, so they need help to be more consciously aware of what they do. Then they need the tools to pass their magic on to others. 

Finally, some of their key capabilities need to be captured and incorporated into leadership development.

Some companies do get this right. A global consumer manufacturing company was looking for frontline leaders who were able to get the best out of people. They started off by looking in the traditional places – the top performers and high potentials. Although these people had outstanding personal results and were leaders of the future, the performance of their teams was not always as stellar. 

Rather they found that there were a group of ‘informal leaders’ who weren’t always seen as easy to manage, or as charismatic, but whose team would always go the extra mile. These frontline informal leaders were often happy staying at the level they were, loving the operational challenges and feeling this was where they made a difference.

Having identified these leaders, companies then need to harness their skills to drive transformation and understand the ‘magic’ they bring. A global electronics firm did this with 100 people across businesses and geographies working with them to help them understand why what they did was special. Time and again the response was, “I didn’t think I was doing anything particularly different”. 

However, sharing the feedback of peers helped them become more self-aware. One of them said that this allowed them to think about what they do, rather than act intuitively and reinforced their determination to get even better. From this they found three things these people do exceptionally well regardless of the business: they challenge colleagues to do better, support them, and make sure that what they do is aligned to the business.

The next step is to give informal leaders the tools and support to spread their influence. A US retail firm which wanted to improve customer experience found individuals in a dozen stores who were informal ‘customer experience’ leaders. 

These individuals were supported to develop skills in influencing and facilitating to encourage their colleagues to pick up these capabilities. In under four months across all their stores, there was improvement not only in customer service but also revenues, profitability and employee engagement.

What all these examples had in common was that the lessons from these informal leaders were captured and included in the formal leadership initiatives. Each company had real life examples of what successful leadership looked like in their own context rather than just theory straight out of a leadership textbook. These informal leaders also played a part in delivering their lessons and experience back in the classroom.

Ashley Harshak is a people and talent expert at PA Consulting

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