How Vertical Development helps new leaders truly transform

Have you noticed how awash the internet is with advice from investors and other gurus about how to build and lead technology businesses? CEOs and other new leaders need good advice“guidance or recommendations offered with regard to prudent future action” – if they are to stand any chance of building a successful business. There are many core skills that must be acquired, and there is much to be learned from those who have done it before. But to develop truly effective leaders we need to move beyond providing them with more information – telling them what to do and how to do it – to helping them improve how they think, make decisions, and make sense of the world. This is the distinction between horizontal development, which focuses on what you know, and Vertical Development, which concerns how you think.

In a VUCA world, where information and knowledge is everywhere, it will be individuals and teams who develop their ability to think and act in more complex, systemic, and interdependent ways who will be at the vanguard of leadership and business growth. This post dives into the detail of what Vertical Development is and considers its application to leaders in startup and high growth technology businesses. It ends with three habits of mind that you can develop, as a leader, to help you advance your thinking and leadership capabilities beyond what you know to how you think. This is the place where you truly transform and grow.

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Vertical development for new leaders

The difference between horizontal & Vertical Development

As your business grows, so too must your mind. Like a computer, horizontal development increases the size of your mental hard drive, and Vertical Development boosts your processor’s speed and power. Mike Vessey explains the difference in human developmental terms:

Traditional horizontal development focuses on the acquisition of further knowledge, skills and development of specific personal qualities to become more proficient and experienced in a given aspect of leadership. By contrast, Vertical Development transforms the underlying capacity of the leader to make sense of and respond to situations, working directly on their internal ‘meaning making’, rather than just behaviours or actions. 

Vertical development complements horizontal development rather than replacing it – leaders still require the knowledge, skills, competencies and personal qualities to be able to perform effectively at whatever development stage they may be operating. Unlike the corporate world, which grooms its leaders over a period of years, startup leaders are often thrust into leadership roles without any real training or experience and must learn quickly on the job. Equipping founders and new leaders with foundational horizontal leadership skills is therefore an essential part of their early development. Afterall, a business that has raised £1 million is a very different place from one that has raised £10 million, which is a very different place from a business that has raised £100 million. In the same way, a business with 10 team members is very different from a team with 50 members, which is very different from a team with 150 members (reaching Dunbar’s Number ushers in a whole new world of complexity).

A lot of leaders really struggle with the transition. Some ultimately fail and find themselves removed from the leadership team or kicked out of the business entirely. Investors struggle too. With the pressure on returns they want to see results quickly and some fail to grasp that leaders must grow just like the businesses that they’re invested in. It’s an opportunity missed for all because new leaders can develop transformationally with the right will and support.

Stages of Vertical Development

Nick Petrie from the Centre Creative Leadership explains Vertical Development’s foundations in Adult Development Theory and how its different stages play out from a leadership perspective at work:

As children grow, the way they think advances through predictable stages. Piaget [a Swiss psychologist] noticed that at each higher stage, children could think in more complex and sophisticated ways, meaning they were able to deal with increasingly difficult problems. Where Piaget left off in childhood, researchers like Robert Kegan and Bill Torbert picked up in adulthood. For a long time it was assumed that once you reach adulthood, these stages of development would stop – after all you are a grown-up, right? But Kegan and others discovered that developmental stages do in fact continue into adulthood, though something about the way adults develop through them changes. Whereas children move rapidly through the stages, an adult’s pace of development slows dramatically, almost to the point of plateauing. In addition, while a child’s development appears to happen automatically, adults cannot simply sit back and wait; now they need to work to keep growing.

Just like the rate of business growth is non-linear in a startup, neither is your personal growth. Says Kegan:

What gradually happens is not just a linear accretion of more and more that one can look at or think about, but a qualitative shift in the very shape of the window or lens through which one looks at the world. 

Dependent-Conformers are uncommon in leadership positions across all businesses because they have not yet developed basic leadership skills and characteristics. That said, given the early focus in startups and high growth businesses on technical skills, such individuals can find themselves in leadership roles. Feeling completely out their depth as their responsibilities intensify this can strongly negatively impact the individual’s personal wellbeing, their team’s and the business overall.

The characteristics of Independent-Achievers are the most common attributes that I see in leaders that I work with in growth-stage businesses. But what got you here, won’t get you there – helping a leader transform from an Independent-Achiever to an Interdependent-Collaborator is the fundamental role of a development coach.

Vertical Habits

Fred Wilson’s post What a CEO does is considered the classic on the subject of leadership responsibilities. The team at Lux Capital recently came up with an updated version: the Five core jobs of a CEO. You can see that because each of these elements are relatively bounded, a leaders job is difficult but learnable. However, as your business and role increases rapidly in size and complexity, another responsibility gets added to your to-do list:

Know where you’re going and how to get there (so people will follow you) and also be open to the ideas of others (so that others add to your thinking and are engaged in a purposeful way). In other words: be a leader and learner simultaneously.

Jennifer Garvey Berger, Changing on the Job: Developing Leaders for a Complex World (Amazon UKUS).

So you can see that whilst venture capitalist blogs will help you acquire knowledge and learn new skills, they won’t necessarily help you navigate complexity and truly grow as a leader. Here are three habits of mind, highlighted in Jennifer’s book, that will:

Ask different questions

If we really want to grow on the job, it becomes vital for us to not simply ask our regular questions again and again, but to ask questions that move us beyond the frontier of our current understanding. This is paradoxical because we are rewarded at work for knowing the answers rather than asking the questions. We are generally not rewarded for uncertainty, yet having the courage and ability to ask different questions, and being open to a wider range of possibilities, is key to equipping us to be able to manage complex issues.To be able to ask different questions, questions that will keep us learning, is a habit of mind that stretches the brain, makes possible new discoveries and new connections, and creates a distinctive learning system.

Take multiple perspectives

Taking multiple perspectives enables people to see a wider range of possibilities, be able to empathize, make deeper connections, and understand the views of others. Even with these benefits, taking multiple perspectives isn’t natural for most people. The brain acts as a filter, keeping from view any ideas or perspectives that might be disconcerting – or that might actually teach us a thing or two. Learning the habit of intentionally taking other people’s perspectives stretches the mind and makes it possible to see new options. And when someone has the habit of taking multiple perspectives for herself, others begin to sense the openness and begin to offer information that a person with a more closed perspective and affect might never hear. This means that the multiple perspectives begin to be fed from within and from without, and people have greater access to the broader views they need in order to address complex issues.Perhaps it s not surprising that at every developmental form of mind, it is easier to take the perspective of someone who agrees with you than someone who disagrees with you. Increasing the capacity to cope with differing perspectives is the hallmark of growth.

See the system

The human mind is a pattern-making device. We think and see and clump into patterns. We do not have to try to see patterns; our brain sees information and clumps it for us.One set of capacities and perspectives that grows over time is our ability to see progressively more complex patterns. Seeing how things are connected to one another makes the world in some ways seem less mysterious (because we see the interactions between things that once just seemed like an assorted collection of unconnected events). In other ways, it makes the world seem more complex, with tangles threads that go in every direction. It is the progression from simple – but mysterious – to complex – but potentially overwhelming – that is the core growth in this regard.

If you enjoyed this, you might like:

Check out how I incorporate Vertical Development into my own Approach to coaching.

Leading on the job: advice for new leaders, in which I pass on what I’ve learnt coaching new leaders in venture capital and private equity backed businesses.

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