An in-depth case study on how First Consulting Group (FCG) navigated a leadership crisis by creating a bespoke executive development program. Faced with challenges from explosive growth, a sudden IPO, and the untimely death of its founder, FCG needed to rapidly cultivate its next generation of leaders.
The Challenge: A Leadership Crisis Amidst Growth
In 1998, First Consulting Group was a twenty-year-old firm grappling with significant change. In just six years, it had grown from a $25 million organization with 200 associates to a $300 million firm with over 2,000 employees. This period included a whirlwind IPO and the sudden loss of its founder and CEO, leaving a succession plan in its early stages.
Externally, the consulting landscape was shifting. The rise of the internet, new e-consultancies, and evolving client expectations demanded more than the traditional consulting model. Clients wanted creative solutions and risk-sharing partnerships. It became clear that the firm's current leadership skills were inadequate for future demands, with projections showing a need for over 300 leaders in the next four years. Relying on external hires was financially unsustainable, with potential recruitment costs in the tens of millions.
Designing the "Leadership First" Program
In response, FCG’s Executive Committee, with guidance from leadership expert Warren Bennis, formed a task force to design an accelerated development program for current and future leaders. This initiative was named "Leadership First."
Core Program Objectives
The program was designed to be more than a simple training event. Its primary objectives were to:
- Propagate a widely understood corporate vision.
- Build succession plans by identifying and training future leaders.
- Create an environment where leaders interact and depend on one another.
- Instill a new set of leadership values into the company culture.
- Ensure the program was substantive and based on real-world business problems.
Identifying and Mitigating Barriers
The design task force anticipated several potential barriers. A lack of a shared vision and a tendency toward short-term thinking were identified as key issues for the Executive Committee to resolve. The absence of a 360-degree feedback process suggested a general lack of self-awareness among leaders, making a comprehensive assessment process a critical design element. Furthermore, reward systems historically favored revenue generation over leadership behaviors, indicating a need for modification to support the program's goals.
A Multi-Faceted Assessment Framework
A cornerstone of the Leadership First program was its comprehensive assessment process, designed to provide participants with maximum self-awareness before the program began.
The Leadership "Gap" Assessment
The task force first analyzed the gap between existing skills and future needs. While current leaders had strong business and planning skills, the analysis revealed deficiencies in areas crucial for future success, including:
- Ability to create and communicate vision.
- Courage to take risks and create change.
- Broad business acumen and financial intricacies.
- Ability to develop others (be a "sensei").
- Emotional competency and strength of character.
Comprehensive Participant Assessment
To provide deep, individual insights, the program used a multifaceted assessment package for each participant:
- Participant Self-Assessment: Against the targeted leadership behaviors.
- 360-Degree Assessment: Feedback from peers, subordinates, and superiors.
- External Benchmark: Comparison against a profile of 600 peer managers and professionals.
- Managerial Style Profile: Measured by the Atkins Kacher LIFO.
- Behavioral Needs Profile: Measured by the FIRO-B.
This data formed the basis of each participant's personalized "Learning Contract" for their development journey.
Core Components of the Leadership First Program
The program design was intensely practical and tailored specifically to FCG's environment, using spaced learning across three multi-day sessions over five months.
An Action-Learning, Case-Based Approach
To be relevant to its intellectually talented audience, the program was heavily experiential. Key characteristics included:
- Executive Facilitation: FCG’s own CEO and senior executives served as program facilitators.
- Real-World Case Studies: The curriculum used actual FCG business situations, market challenges, and strategic opportunities for analysis. This included balance sheet analysis, merger evaluations, and responses to shareholder issues.
- Action Learning: Lectures were minimized. Instead, participants engaged with pre-readings from classic and contemporary sources and applied concepts in small group breakout sessions and homework assignments.
- Spaced Learning: The program consisted of three sessions (3 days, 3 days, and 2 days) over a five-month period, with mandatory attendance to ensure immersion and continuity.
Outcomes and Lessons Learned
Feedback from the first 60 participants was overwhelmingly positive. The most impactful aspects were the in-depth assessment process and the use of relevant, FCG-based case studies.
Key Intangible Gains
While long-term financial metrics were still developing, the firm realized several immediate, intangible benefits:
- Improved Communication: A dramatic improvement in cross-organizational communication was an unintended but valuable benefit.
- Strategic Unity: The program led to a stronger unity of purpose and a deeper buy-in to the firm's mission and strategy at senior levels.
- Enhanced Perspective: Participants developed a more strategic, firm-wide perspective and a deeper appreciation for the demands placed on senior executives.
Sustaining Momentum
To ensure learning continued beyond the classroom, the program incorporated several mechanisms:
- Group Mentors: An Executive Committee member was assigned to each group as a sponsor and mentor.
- Follow-Up Assessments: A second 360-degree assessment was conducted 9-12 months post-program to track behavioral progress.
- Ongoing Reinforcement: Participants were encouraged to share their Learning Contracts with their managers, linking the program to the firm's existing performance development process.