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Read the case study “Federated Industries’ at the end of Chapter 13 and answer the questions at the end of the reading.
Patricia Paterson is the new vice president for human resources at Federated Industries, a
conglomerate with several diverse subsidiaries.Her primary responsibility is to provide sup-
port and advice to each subsidiary and moni-tor their personnel practices to ensure they
are consistent with corporate policy and strat-egy.She reports directly to the CEO of Fed-
erated.The CEO is concerned that not enoughcapable leaders are coming up through the
ranks.The subsidiaries have complete respon-sibility for their own internal management de-
velopment,but the CEO wonders whether it istime for a more uniform approach.The CEO
asked Patricia to find out what each subsidiary is doing to develop leadership skills,
then report back with recommendations for improving leadership development overall at
Federated Industries.Patricia arranged to meet with the personnel directors of the three major
subsidiaries and asked each director to prepare a short briefing. The first director to speak was Peter
Proskin, from an engineering company. He explained that his company provides only
technical training,because they lack the staff to provide management training. All man-
agement training is done outside the company. A manager (or an employee who wants to
become a manager) can look at the listing of available training and request any seminar
or workshop that appears relevant. If the employeeâ€™s boss approves the request, the
manager is sent to the training at company expense. Some employees are enrolled in the
evening MBA degree program at the local university,and they are reimbursed for half of
the tuition cost.Peter said they do not pay complete tuition for degree programs, because it is
too costly. After some employees finish their MBA, they leave for higher-paying jobs at other companies eager to get people who have managerial as well as technical skills.
The second director to report was Alice Alston, from a company that makes con-
sumer products. She explained that the com-pany provides a program to develop leadership
skills in high-potential managers. Managersat each level are encouraged to identify a
promising subordinate to mentor. The protÃ©gÃ© gets lots of personal coaching and is
given special, developmental assignments.For example, a couple of junior managers
are put on each executive committee to learn about strategic issues and observe how
the senior managers work. Other assignments include serving on cross-functionalproject teams and carrying out improvementprojects such as studying work processes and recommending ways to make them more ef-
ficient. Alice said that most of the mentors and protÃ©gÃ©s like the program.However,people not in the program (roughly two-thirds of the employees) sometimes complain about
the lack of developmental opportunity in the company.
The last director to speak was Hal Harwick, from an electronics company. Hal
explained that they concentrate their training on managers who previously demonstrated
their executive capacity.The six most promisng managers below the top executive level
are selected to participate in a series of seminars held once a month. Each seminar is
conducted by one of the top executives, who
talks about company activities in his or her
area of expertise.Three or four times a year,
Hal arranges for an outside consultant to con-
duct a training workshop on a specific topic
such as project management, budgeting, or
delegation.The participating managers know
they are fast-trackers in line for promotion totop management.They like the program and
have told him it is very worthwhile.When one
of them is promoted,another promising man-
ager is selected for the program by the top management team.The only drawback is the
political infighting that sometimes occurs
when executives try to get their protÃ©gÃ©s se-
lected for the program. â–
SOURCE: Copyright Â© 1996 by Gary Yukl.
1. Identify strengths and weaknesses in leadership development at Federated Industries.
2. What types of changes are most likely to improve leadership development at Federated
3. What additional information is needed to make a good report to the CEO?
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