Executives in virtually all industries bemoan a dearth of leadership talent, a shortfall that is poised to get worse when the economy strengthens and baby boom-era executives retire. A recent research report from the Conference Board, “Developing Business Leaders for 2010,” highlights the impending competition for talent since the age cohort that follows the baby boom group is approximately 18 percent smaller in both the United States and Europe. This phenomenon, especially in an era of constrained resources, places increased pressure on organizations to identify and develop leadership talent both more efficiently and more effectively.

Senior leaders in the great majority of companies are quick to join the chorus in saying, “People are our source of competitive advantage.” But the attitudes prevalent in talent-mindset companies such as General Electric, Colgate-Palmolive and PepsiCo are quite different from the philosophy and practice of most organizations. Leaders in these companies base their succession planning and talent development practices on certain fundamental assumptions:

• Future leaders develop best via a rich set of on-the-job experiences.
• Developing leadership requires a willingness to take risks on people and take them out of their comfort zone.
• On occasion, positions should be filled for explicit leadership development purposes, not necessarily with the best-qualified candidate.
• Future leaders must get candid and constructive feedback about their performance and what they need to develop to get ahead.
• External recruiting is an integral part of talent development. As a result, every management-level search is viewed as an opportunity to upgrade the leadership “gene pool.”
• Attracting, developing and retaining talent are core expectations of all managers to the extent that it’s a key factor in their own career advancement.

Such attitudes need time to take hold. However, a certain set of practices — if supported by even a few senior executives and HR leaders — can create a fertile environment and build stronger leadership capability in the process.