As the economy strengthens and baby boomers retire, corporate competition over the recruitment and retention of leaders will intensify. To prepare for this change in the market, top companies are thinking about not only how to develop leaders from within, but also how to compensate, train and rotate leaders so that their experience is most valuable within the company where the development originated.

This strategic alignment not only improves preservation of culture and vision, it also decreases the loss of key leaders, since their learning and development makes them most valuable in their originating company. Average companies design leadership development programs that provide talented candidates with generic, marketable leadership skills.

According to recent research (available at http://www3.best-in-class.com/dr250.htm) by Best Practices Research and Consulting, top companies are mastering some of the following areas:

- Rotational Programs: A benchmarked company employs a two-year formal
plan designed to expose associates to all primary business functions.
Employees spend approximately four months conducting Six Sigma or
business process improvement projects in critical-to-quality business
functions (operations, finance, IT, HR, compliance, business
development).
- Performance Measurement: Senior executives at several organizations are
moving in the direction of basing promotion and development plans on
the result of talent reviews. For example, one company has a goal for
devoting 30% of senior management time to developing employees.
- Employee Retention: Some companies have had no pay raises in recent
years because of company performance and market difficulties. Partners
shared how difficult it can be to retain valuable employees in
difficult times. In a year with no pay raises, one company gave
everyone 100 stock options, which helped improve morale and retain
valued employees.