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The Development of Management and Leadership Capability and Its Contribution to Performance: the Evidence, the Prospects and the Research Need

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The Development of Management and Leadership Capability and Its Contribution to Performance: the Evidence, the Prospects and the Research Need RESEARCH The Development of Management and Leadership Capability and its Contribution to Performance: The evidence, the prospects and the research need John Burgoyne, Wendy Hirsh and Sadie Williams Research Report RR560 Research Report No 560 The Development of Management and Leadership Capability and its Contribution to Performance: The evidence, the prospects and the research need John Burgoyne, Wendy Hirsh and Sadie Williams The views expressed in this report are the authors’ and do not necessarily reflect those of the Department for Education and Skills. © Lancaster University 2004 ISBN 1 84478 286 7 1 ACKNOWLEDGEMENTS This report has been written by John Burgoyne, Wendy Hirsh and Sadie Williams as members of the Management and Leadership Development Research Network. This group consists of researchers concerned with the topic of this research. Other members have made specific contributions. Chris Mabey has provided a special input on nature and effects of corporate management development. Kim James, David Beech, and Lew Perren have provided special reviews on corporate management and leadership development strategies, leadership and the development of management and leadership capability in small and medium enterprises respectively. The general approach to the project, locating specific studies, drawing conclusions from these, and the judgements about useful future research priorities have been informed by discussions in the network group and comments by its individual members as the review has progressed. The members not already mentioned are: Kamal Birdi, Richard Bolden, Johnathan Gosling, Jim Hillage, Matias Ramirez, Penny Tamkin, Marc Thompson, Stephen Watson and Stephen Wood. 2 1: Executive Summary........................................................................................1 2: Introduction ....................................................................................................6 3: The Nature and Current State of Management and Leadership Capability ............................................................................................................9 Chapter overview...................................................................................................................9 3.1 The population of managers and leaders in the UK ......................................................10 3.2 Management and leadership capability .........................................................................11 3.2.1 Changing ideas about management and leadership................................................11 3.2.2 Competencies and frameworks...............................................................................14 3.2.3 Issues in relation to management skills and competencies.....................................16 3.2.4 Ethnic minority groups in management and leadership and gender differences....17 3.3 Management and leadership development: current state, recent and future trends.......18 3.3.1 Volume and nature of management and leadership development in the UK .........18 3.3.2 Trends in management and leadership development..............................................21 4: Does Management and Leadership Development Enhance Performance? .............................................................................................................................25 Chapter overview:................................................................................................................25 4.1 Management and leadership capability and national performance................................27 4.1.1 Does management and leadership affect national productivity? ............................27 4.1.2 Does the UK have a management skills shortage?.................................................28 4.2 Management and leadership development capability, management and leadership development and organisational performance.....................................................................29 4.2.1 Management and leadership capability and organisational performance...............29 4.2.2 Management and leadership development and organisation performance.............30 4.2.3 Wider HRM and organisation performance, and management and leadership......33 4.3 Management and leadership development, individual capability and individual performance .........................................................................................................................38 3 4.3.1 Impact of HRM and management and leadership development at individual level .........................................................................................................................................38 4.3.2 Does capability necessarily lead to performance?..................................................40 4.4 Evidence for the impact of higher education in management and leadership on capability and performance..................................................................................................42 4.4.1 Employment and career impact ..............................................................................42 4.4.2 Individual learning and skills .................................................................................45 4.4.3 Impact on individual performance at work.............................................................46 4.4.4 Impact on organisational and national performance...............................................48 5: How can Management and Leadership Development Work? .................49 Overview .............................................................................................................................49 5.1 Effect of learning environment and challenges faced....................................................50 5.2 Formal and informal development approaches..............................................................52 5.2.1 Mentoring and coaching .........................................................................................52 5.2.2 Management development and organisational strategies .......................................53 5.3 Capabilities needed for specific aspects of management and leadership ......................54 5.3.1 Management competences can be taught ...............................................................54 5.3.2 Creativity and the management of change..............................................................54 5.3.3 Need for more than basic competences ..................................................................56 5.4 Effect of organisational and managerial support...........................................................57 5.4.1 Organisational context............................................................................................57 5.4.2 Effects of transformational leaders.........................................................................58 5.5 How management and leadership development affects performance ...........................59 5.5.1 Ways in which HR practices affect performance ...................................................59 5.5.2 Relating management development to performance ..............................................60 5.5.3 Difficulties of establishing a clear link...................................................................61 5.5.4 Proxy measures of capability..................................................................................63 4 5.6 Management and leadership development and factors linking with capability and performance impact .............................................................................................................63 5.6.1 Management and leadership development which incorporates feedback...............64 5.6.2 The contributory role of organisational processes and climate ..............................65 5.7 What makes a good manager, leader, and entrepreneur in differing circumstances?....66 5.7.1 Entrepreneurial skill................................................................................................67 5.7.2 Leadership skill.......................................................................................................67 5.7.3 What managers need to learn..................................................................................69 5.7.4 Changing management skills..................................................................................69 5.8 Management and leadership in the public sector...........................................................69 5.9 Size of organisation .......................................................................................................71 5.10 Dominant organisational culture .................................................................................72 6: What is the Strength of the Evidence? .......................................................74 Overview .............................................................................................................................74 7: Priorities for Future Policy and Practice Research ..................................77 Overview .............................................................................................................................77 7.1 The need for more evidence based research in general .................................................77 7.2 Research on effect as well as situation ..........................................................................78 7.3 Corporate good practice and external education, training and development support....78 7.4 Priorities and relative
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