What Is Your Leadership Quotient?

Leadership effectiveness can be measured, and even tied to business performance.

There is a big contradiction in our thinking when we elevate high performers to leadership positions. Not all high–performers are great leaders, yet we reward them with promotion. 

Dr. Robert Hogan (developer of the Hogan Index) found that only about 30% of those elevated to leadership or managerial roles are qualified to lead. What of the remaining 70%? Can they acquire the skill–set to lead?  Do we really know what makes a great leader? What if your leadership could be measured?

The Leadership Circle Profile (LCP) measures leadership effectiveness against norms. Developed by Robert Anderson, the LCP is the only 360–degree assessment that integrates the key leadership theories into a single approach. He then developed a Business Performance Index, using criteria such as revenue, market share, profitability, product quality etc, and correlated Business Performance to Leadership Effectiveness. When a leader scores in the 80th percentile on Leadership Effectiveness, that person is 38% more likely to deliver higher business performance.

The Leadership Quotient is a simple calculation, based on millions of data points collected over the years of administering the LCP­: Leadership Quotient equals Leadership Effectiveness divided by Leadership Ineffectiveness: 

                                                                            LQ=LE/LI

An LQ score of 1.0 means your leadership has a neutral impact on company performance (1.0=50%/50%.)

The LQ for leaders of the highest performing companies (top 10%) is 4.0 (4.0=80%/20%.)

For leaders of the lowest performing businesses, the average LQ score is .4 (0.4=30%/70%.)

Chances are, your Leadership Quotient is between these polar opposites.

Anderson’s work is corroborated by leadership experts Jack Zenger and Joe Folkman. In their book, Extraordinary Leaders, they found that leaders rated at the 80th percentile or above on a 360–degree competency assessment, “will produce twice the results of those in the mid–60 percentile range.”

I call this field of study The Metrics of Leadership. It is unlike any other school of measurement in that it ties one’s leadership effectiveness to business performance, and provides clearer, practical road maps for leadership improvement.

While metrics should not drive the bus, it is a good idea to know where one stands. If you can get the majority of executives on the leadership team into that 80th percentile, your company will have a significant competitive advantage.

We live in a world of high volatility, uncertainty, complexity and ambiguity (VUCA), a concept first introduced to us by futurist Bob Johansen in his 2009 book, Leaders Make The Future. Johansen’s research revealed that many leaders feel over their heads when it comes to leading in a VUCA world.  

As Anderson puts it, “The development of leadership effectiveness must keep pace with the rate of change and the rate of escalating complexity.”

It is therefore possible that a really good CEO can rally his or her folks around a common cause and have a system of accountability that cascades from the top of the organization–and still fall short of performance goals. Increasing complexity is to blame. One need only look at the dramatic changes occurring in the healthcare industry to find evidence of that.

Getting the right people in the right seats is only part of the challenge.  High performers deserve greater rewards, but they need the right tools to succeed. What is your and your team’s leadership quotient? What skill–sets do leaders need to be in the 80th percentile of Leadership Effectiveness? There is a way to find out. The Leadership Circle Profile is a road map to build good leaders into exceptional leaders.