THE CASE: The Leadership Vacuum You Didn't See Coming
Ranjit is the CEO of a 200-person manufacturing company. His business is stable, profitable, and growing steadily. But when he looks at his senior leadership team, he sees a looming crisis:
His COO is 58. Planning to retire in 3 years. His CFO is 62. Retiring in 2 years. His VP of Operations is 60. Retiring in 4 years.
The next layer down? Mid-level managers in their mid-30s. Great at their jobs. But they lack strategic decision-making experience, board-level communication skills, cross-functional leadership capability, and long-term vision.
His options: (1) Promote unprepared managers High risk of failure. (2) Hire externally Expensive, slow, cultural risk. (3) Do nothing and hope Guarantee of crisis.
He chose option 4: Build a leadership pipeline deliberately.
Deloitte found that only 13% of companies believe they have robust succession plans in place. Senior leadership isn't learned in a classroom. It's developed through exposure, practice, and mentorship. The gap isn't knowledge—it's exposure and practice.
The Experience Gap
| Mid-Level Manager | Senior Leader |
|---|---|
| Executes within their domain | Thinks cross-functionally and strategically |
| Manages people and processes | Manages complexity and ambiguity |
| Solves known problems | Navigates unknown problems |
| Reports to leadership | Makes company-level decisions |
| Communicates to their team | Communicates to board, investors, stakeholders |
The Evidence
Only 13% have robust succession plans (Deloitte)
50% higher financial performance with strong pipelines (HBR)
6-9 months to fill executive roles externally (Spencer Stuart)
Internal hires perform 20% better (LinkedIn)
70% faster readiness with stretch assignments (DDI)
3X higher retention with executive mentorship (Gartner)
Build the Leadership Pipeline
Step 1: Identify High-Potential Leaders (60 minutes)
Who are your 3-5 mid-level managers who could step into senior roles in 3-5 years?
Criteria:
- Strong domain expertise
- Respected by peers and teams
- Demonstrated ability to learn and grow
- Alignment with company values
- Aspiration to grow (not everyone wants senior leadership)
Ask them: "In 5 years, do you see yourself in a senior leadership role here?"
Step 2: Design "Shadow Projects" (90 minutes)
Assign high-potential managers to observe a senior leader managing a critical initiative for 4-8 weeks.
Example: "We're evaluating a strategic partnership with Company X."
- High-potential attends all meetings as an observer (not participant)
- Observes how decisions are made, questions asked, stakeholders managed
- Writes a 2-page reflection: "What did I learn about senior leadership?"
Step 3: Create Cross-Functional Stretch Assignments (60 minutes)
Give managers projects outside their domain:
- Engineering Manager Lead a customer feedback initiative with Sales and Product
- Marketing Manager Analyze and propose improvements to the sales process
- Operations Manager Design a new employee onboarding experience with HR
Why: Forces them to think beyond their silo, builds empathy for other functions, tests ability to lead without direct authority.
Step 4: Implement "Leadership Challenges" (90 minutes)
Once per quarter, run a mini-project:
- Present a real company problem (e.g., "How do we reduce customer churn by 10%?")
- Form small, cross-functional teams of high-potentials
- Give them 2 weeks to analyze, develop solution, present to senior leadership
- Senior leaders provide feedback on how they approached the problem
Step 5: Assign Executive Mentors (30 minutes)
Pair each high-potential with a senior leader for 6 months. 30-minute 1:1 every other week. The mentee brings challenges, questions, or decisions. The mentor coaches.
The Experiment: Board Meeting Observer Program
For the next 6 months:
Once per quarter, invite one high-potential manager to attend the board meeting as a silent observer.
- They sit in the room, listen, take notes
- After the meeting, debrief with the CEO: "What did you notice? What surprised you?"
Why it works:
- They see how the CEO communicates at the highest level
- They understand what the board cares about
- They gain perspective on strategic priorities
- It demystifies senior leadership
Building a "Talent Factory"
The companies that win long-term don't just hire great leaders. They build them.
From Good to Great: Great companies are "talent factories"—they systematically develop leaders at every level.
From The Five Dysfunctions: Great leadership teams require trust. Trust is built through shared experiences. Shadow projects, stretch assignments, and mentorship create those experiences.
Sources & References
- Collins, Jim. Good to Great. HarperBusiness, 2001.
- Lencioni, Patrick M. The Five Dysfunctions of a Team. Jossey-Bass, 2002.
- Deloitte Insights. Global Human Capital Trends: Succession Planning. 2023.
- Harvard Business Review. "Building a Strong Leadership Pipeline." 2022.
- LinkedIn Learning. Talent Trends Report. 2023.
- Spencer Stuart. Executive Search and Succession Report. 2023.
Key Takeaways
- Senior leadership isn't learned in a classroom—it's developed through exposure and practice
- Shadow projects give high-potentials visibility into strategic decision-making
- Cross-functional stretch assignments build breadth and empathy
- Executive mentorship transfers tacit knowledge that can't be taught
- Build your leadership pipeline deliberately—and you'll never face a leadership vacuum