Why High-Potential Leaders May Still Be Unprepared for the Demands of Their Next Role

Executive Programme in Strategy and Leadership

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Leadership pipelines can identify strong performers without preparing them for the demands of a bigger role. Research on leadership transitions shows why organisations need to assess readiness earlier and develop leaders for the roles they are expected to take on.

Organisations often identify leaders for promotion based on what they have already demonstrated: strong performance, sound judgement, and the ability to deliver results. Yet moving into a larger role can change the nature of the work itself. The qualities that made someone successful in one position may not be enough for the next.

A business-unit leader may have built a reputation for deep expertise, fast decisions and strong execution. Those strengths do not always transfer directly to an enterprise-wide role, where leaders need to work across functions, balance competing priorities, and make decisions without having all the answers. As the mandate broadens, capabilities that were less important in the previous role can become critical.

“A leader who succeeds in one role is not necessarily ready for the role above it, because the nature of the strategic problem can change as the scope of responsibility expands. At a higher level, leaders must move beyond optimising what they already know and become comfortable making choices across unfamiliar domains, balancing competing priorities and creating value under greater uncertainty. The question, therefore, is not simply who has performed best in the current role, but who has demonstrated the ability to operate effectively in the context of the role ahead,”

Deepak Jena

Assistant Professor of Strategy, ISB

That challenge is becoming more important as organisations adapt to new technologies, changing workforce expectations and more complex operating models. The World Economic Forum’s Future of Jobs Report 2025 estimates that 39 per cent of workers’ existing skill sets will be transformed or become outdated by 2030. It identifies resilience, flexibility and agility, and leadership and social influence among the most important core skills, while creative thinking and curiosity and lifelong learning are expected to continue rising in importance. The Graduate Management Admission Council’s Corporate Recruiters Survey 2026 similarly finds that employers expect skills using AI tools to grow the most in importance over the next five years, alongside strategic thinking, decision-making, problem-solving and adaptability. Deloitte’s 2026 Global Human Capital Trends finds that 85 per cent of leaders consider it critical for their organisation and workforce to adapt at the required speed, yet only seven per cent say their organisation is making great progress towards doing so.

The next role requires different capabilities

The consequences of a difficult transition can quickly become visible. McKinsey’s research found that nine out of 10 teams whose leaders made successful transitions went on to meet their three-year performance goals. But when leaders struggled with the transition, the performance of their direct reports was 15 per cent lower, and those employees were 20 per cent more likely to become disengaged or leave the organisation.

The financial consequences can be significant at the top of the organisation. A Harvard Business Review analysis estimated that poorly managed succession destroys close to $1 trillion in value each year among S&P 1500 companies. Internal successors are part of this challenge: a leader who has performed well within the organisation may still struggle when the new role calls for different skills and behaviours.

The gap is particularly relevant because internal promotion remains central to succession planning. DDI’s Global Leadership Forecast 2025 found that only 20 per cent of HR leaders believe they have leaders ready to fill their most critical roles, while 75 per cent of organisations prioritise internal promotion over external hiring.

Taken together, the research points to a practical problem: organisations can be good at identifying high performers without being equally good at determining who is ready for a different kind of leadership role.

Preparing leaders for the role ahead

Succession planning needs to start with the role the organisation will need to fill. What will the position demand when the next person takes it on? Which capabilities will become more important? What experience will the potential successor need before making the move?

What leaders should know:

Define what the next role will require. Identify the capabilities, experience and behaviours that will become critical as the scope and complexity of the role increase.
Assess the gap. Performance in the current role is only part of the picture. Assess potential successors against the capabilities that the next role will require and identify where their current capabilities or experience may fall short.
Test readiness before the transition. Give potential successors opportunities to work across functions, manage unfamiliar problems, and make decisions in situations that resemble the role they are being prepared to take on.
Address specific development gaps. Leadership development is more useful when it is tied to the demands of the future role rather than delivered as a generic set of leadership courses.

Campbell’s, a US food and beverage company with more than 150 years of history, has built leadership development programmes around the capabilities it expects to need at different levels of the organisation. The company brings former participants back as instructors so that colleagues can learn from leaders who have applied the ideas in practice.

A European e-commerce company studied by McKinsey took a similar approach after rapid pandemic-era growth was followed by a sharp correction. Its executive team concluded that changes to the strategy and operating model needed to be accompanied by changes in leadership behaviour. A nine-month development programme combined diagnostics, workshops and coaching to help the team move from a functional focus towards a shared view of the enterprise and new approaches to decision-making and empowerment. It gave the team an opportunity to develop and apply the behaviours required by its changing strategy and operating model.

The strongest succession plans therefore do more than identify who has performed well. They give potential successors a chance to demonstrate how they handle the broader scope, uncertainty, and complexity of the roles they may eventually take.

References:

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Google. (2025, October 14). Our first AI hub in India, powered by a $15 billion investment.
Yotta Data Services. (2026, February 18). Yotta to deploy 20,736 NVIDIA Blackwell Ultra GPUs in over $2 billion AI supercluster.
Reuters. (2026, July 8). India estimates 300 GW power demand next year, backs local clean-energy manufacturing.
Reuters. (2026, August 6). Google’s $15 billion India data centre project battles water, wildlife concerns.
Government of India, Ministry of Finance. (2026, February 1). Tax holiday till 2047 for eligible foreign cloud providers using Indian data-centre services.