Why Horizontal and Vertical Development are the keys to future success

For CEOs and business leaders today, their role extends beyond the typical challenges of ensuring profitability and executing the business strategy. They are also responsible for managing tensions between customers who want climate-conscious products and business operations, employee physical and mental health care, and the transition to a hybrid work environment. Furthermore, CEOs need to consider exponential rates of change in technology (including AI and robotics), digital currency disruptions, the impacts of globalization and geopolitics (such as shifts in power), as well as social media.

Today, leaders, organizations, and societies face ever accelerating rates of change and disruption. However, the individual and collective capacity to keep up with change is not growing at the same rate. The rate of change is greater than peoples’ capacity to learn and adapt along with it.

Research by Lectica[1] shows a significant gap between leadership capability and the complexity leaders face, referred to as the “complexity crisis.” The type of development needed to prepare for this reality is not just for senior leaders, and it’s not just about learning new knowledge, skills, and information.

This new approach is called vertical development. Many leaders are now becoming aware that this type of development is important. However, we have yet to see an organization that has unlocked the full power of vertical development interventions.

What is vertical development?

We define vertical development as the development of a leader’s worldview — deepening, expanding, broadening, and transforming their mindsets. This impacts leaders’ behavior and, therefore, results. Put simply, horizontal development is more about competency, and vertical development is more about capacity. Think about expanding development as if it were a glass of water. Adding water to a glass is horizontal expansion, but increasing the size of the glass is vertical expansion. Or, take cell phone operating systems: horizontal growth is about adding more apps; vertical development is about upgrading the operating system. Vertical development means that you can add apps with the ability to do more complex tasks than the previous operating system could handle.

Einstein is known to have said, “We can’t solve problems by using the same kind of thinking we used when we created them.” You can’t solve the problems leaders face today by adding new apps – you need to upgrade your operating system. Leaders today face more and more complex challenges. Adding new competencies, skills, and knowledge is not enough. Leaders’ development also needs to include the vertical dimension of growth so that they can see from a different perspective, find new and creative solutions, act with greater wisdom and capacity, and have a transformative impact within and beyond your organization. This is the type of learning that leaders need in order to meet the exponential rate of change.

In Harvard Business Review, Torbert (2005) found that five out of ten CEOs from various companies were measured at the Strategist level (an advanced level of vertical development), while the other five were measured at lower stages of vertical development. Of the five Strategists, all had successfully implemented organizational transformations in a period of four years, which improved the company’s profitability, market share, and reputation. For the other CEOs, only two succeeded in doing the same.

How do you facilitate vertical development in your organization?

Leaders cannot be forced to grow vertically. It is not the same as horizontal development, where knowledge sharing, training, skill development, or practicing a new behavior are enough. Growth occurs differently in vertical development.

Vertical development is about expanding your mindset — changing how you think and behave. Mindset refers to the mental models you engage when you are thinking, as well as your sense of identity. Vertical development isn’t about training a leader in skills. It’s about transforming the ways a leader thinks, which will impact what they do and how they behave. In vertical development, you become more adaptable, self-aware, and collaborative, with the ability to span boundaries and networks.[2]

We know from research at the Centre for Creative Leadership (CCL 2020) that three aspects facilitate vertical development growth:

1. Heat experiences – experiences where you face a complex situation that disrupts your habitual way of thinking.
2. Colliding perspectives – when you are exposed to others who have different worldviews, opinions, and backgrounds, your own mental model of the world is challenged through these experiences.
3. Elevated sense-making – as you reflect and make sense of the changes in worldview and experiences, you have the opportunity to enlarge your worldview.

By including all three of these aspects in your interventions, you will create prime conditions for vertical development.

Here is one example, which is designed in the context of executing a new business strategy through people:

1. Heat experiences: Leveraging business simulations, participants (dozens or thousands) form groups with other leaders to practice running a modeled version of their business environment. This allows them to align and live the new business strategy or transformation. Leaders are removed from their comfort zones and placed into complex situations, which enables them to grow. Sometimes leaders’ behaviors are observed to offer insights and additional challenges, which turns up the “heat.”

2. Colliding perspectives: Leaders meet others from different functions and levels to grapple with the simulated challenges in small groups to execute the new strategy. Here, leaders’ mental models are challenged through interactions with their peers. Each individual brings a different perspective or worldview and represents a different part of the business. Doing so reduces the polarity of views between groups, such as sales and operations, which can be a powerful tool in preparing leaders to execute a new strategy successfully. Without an intervention like this, these business siloes typically lead to stagnation or slow progress.
3. Elevated sense-making: Through mindset coaching, leaders get the opportunity to step back, make sense of things, and apply their learnings and shifts in worldview. Using a coaching approach that specifically focuses on mindsets or changing worldview is critical to enable this change as it provides critical support for individuals to make the necessary shift.

   It is also important to note here: not everyone will develop vertically. Some leaders will be a driving force for integrating a vertical change, but others may not be ready for such a shift. It is important to facilitate both vertical and horizontal development, and given the current climate, ensure vertical development is included.

Heat experiences, colliding perspectives, and elevated sense-making should be integrated into all of your interventions, enabling you to build the vertical development foundation your leaders need to have the greatest possible impact. When leaders’ worldviews are narrow, their range of choice and creativity is also narrow. As they expand, they will see more, experience more and be able to lead with more. When your leadership development interventions deliberately invite leaders to shift their perspectives and worldview, while also providing new knowledge, skills, and competencies, you empower and unleash your leaders to lead in our complex, globally interconnected world.