-
Addendum : 2022-05-18 : in other words ...
- leadership is quantifiable in terms of how much other people like you
- people who like you more demand less compensation in other currencies, as they derive more currency in terms of happiness (social satisfaction)
- this is a fundamental truth about why leadership matters in talent management
- leadership involves seduction, or persuasion by any other name
-
Original : 2022-03-22 :
Leadership can be apreciated in many ways. In commercial terms, from a financial point of view, the sentimental impact of leadership is not managed until it is tied back to returns (realised, or otherwise).
In general, I am working with a model of measuring leadership simply in terms of the discount rate any leader can get, on the price of talent required to get anything done.
Given infinite talent, any two leaders will deliver the same outcome. However given that talent is a limited resource, the outcome of a leader depends on the difference in cost of talent inputs, required to achieve the same result. Alternatively, given exactly the same talent, two leaders can be differentiated based on their delivered outcomes.
In order to measure leadership operationally, the organisation first needs to have a very good model of how to price talent. Of course most firms don't have this, yet, instead using a rather intuitive non-detailed/non-benchmarked approach.
But here I briefly illustrate where the following are all connected:
1. Identifying ops talent demand
2. Identifying labour market supply
3. Setting price benchmarks for labour given 1,2
4. Defining leadership as alpha over benchmark