How to Identify High Performing Leaders in Tech

This article is part of our series on leadership assessment

There is something visionary about leaders in the tech sector. The constant drive for progress and entrepreneurial spirit means that high performers tend to be visionaries with a technical background and a growth mindset. However, the speed at which the industry develops, the high level of competition means that the talent pool is constantly evolving and churning. Finding the right leaders for each stage of the value creation plan takes more focus and criteria than can be found on a CV.

Before we discuss what makes a good leader in tech and how to assess them, it’s important to understand the tech sector and the challenges investors and leadership teams face when searching for senior hires.

Navigating constant and rapid changes – The tech sector faces constant change, with rapid advancements in technology and shifting market conditions, making it challenging for organisations to identify high-performing leaders who can handle a changing environment. As technology advances and new players emerge, organisations must adapt to shifting customer demands and a highly competitive business environment, which requires leaders who are agile, forward-thinking and capable of navigating complex market dynamics.

Regulatory compliance – The speed of change has another impact. When the tech sector expands, so does the regulatory landscape. Organisations are faced with an increasing number of regulations and compliance challenges, which can place significant pressure on resources. From data protection and privacy regulations – such as the General Data Protection Regulation (GDPR) – to industry-specific requirements; tech companies need to invest in processes and technologies that ensure they remain compliant. Leaders must be able to stay up to date with regulations to avoid financial penalties and loss of customers due to poor customer experience.

High competition for talent – The high demand for skilled tech professionals has led to a fierce competition for talent. Attracting and retaining top performers is crucial for organisations to remain innovative and adapt to the constantly evolving industry landscape. Developing a strong employer brand, offering competitive remuneration packages, and providing engaging career development opportunities are essential in securing the best talent in the tech sector.

What makes a good leader in tech?

Tech leadership qualities

High performing tech leaders possess a variety of traits and qualities that make them effective leaders. Some of these essential leadership qualities include:

Vision: In the fast-paced world of technology, it is essential for leaders to be visionaries in order to stay ahead of the competition and continue to innovate. They see the big picture, are able to anticipate future trends and developments in technology and use this foresight to guide their organisations towards success. 

Adaptability: Tech leaders must be able to adapt to the constantly changing technology landscape and anticipate future trends to keep their teams and companies ahead of the curve.

Technical competence: A strong background in technology is crucial for tech leaders, as they need to understand the technical aspects of the projects they oversee and provide guidance to their team members.

Strategic thinking: High performing tech leaders are able to see the big picture, set long-term goals, and create a vision that aligns with company objectives, while also maintaining focus on short-term objectives.

Effective communication: Clear and concise communication is essential for tech leaders to convey their vision, strategy, and expectations to their teams. This also involves active listening skills to understand the needs and concerns of team members.

Decision-making: Good tech leaders are able to make informed, data-driven decisions under pressure and guide their teams to implement these decisions efficiently.

The role of emotional intelligence

Emotional intelligence plays a vital role in the development of tech leaders. As the tech industry evolves from autocratic to trust-based visionary leadership styles, leadership development programmes must focus on building emotionally intelligent leaders who can understand and manage their own emotions, as well as empathise with others in the workplace. A high level of emotional intelligence (EQ) can lead to better communication, collaboration, and ultimately, higher performance.

One key aspect of emotional intelligence is self-awareness, which helps leaders understand their strengths and weaknesses, as well as how their emotions affect their decision-making process. Self-regulation allows leaders to manage their emotional responses, helping them to stay calm under pressure and foster a positive environment for their teams.

Empathy, another crucial component of EQ, enables tech leaders to build strong relationships with their team members by understanding their needs and perspectives. This leads to greater trust and loyalty within the team, contributing to overall team performance and achieving company goals.

What makes a good leadership team?

Cognitive diversity is a vital element for building a robust leadership team in tech. This concept refers to the differences in thought processes, problem-solving approaches, and perspectives among individuals within a group. Incorporating cognitive diversity into the leadership team enables the leveraging of unique strengths, boosting team creativity and innovation.

A good leadership team in tech recognises the importance of its cognitive diversity, and should be made up of diverse individuals in terms of experiences, expertise and backgrounds. This diversity allows team members to challenge assumptions, learn from one another and develop innovative solutions.

Effective assessment of tech leaders

In addition to the classic CV and interview, leadership performance can now be better predicted by employing a number of people analytics tools. From our research, those that focus on behavioural assessment are more likely to predict future performance than on personality testing. It helps organisations understand the strengths and weaknesses of their leadership style and abilities. 

This data-driven approach has the potential to greatly improve the accuracy of leadership assessments and can help employers identify candidates who are more likely to excel in high-growth businesses. It’s also a good idea to employ tools that are based on relevant data. With our behavioural assessment model, PACE, leaders and leadership teams are benchmarked against high-performing behaviours based on data from the past ten years of successful private equity exits, highly relevant to private equity investors.

However, it is essential to combine behavioural assessment techniques with other assessment methods for a more accurate evaluation of a tech leader's effectiveness. For example:

• 360-degree feedback: Gathering feedback from peers, subordinates, and managers can provide a comprehensive understanding of a leader's behaviour and performance.

• Situational judgement tests: These assessments present leaders with hypothetical scenarios and ask them to choose the best course of action, offering insight into their decision-making processes.

• Personality assessments: Understanding a leader's personality traits can give insight into their leadership style and how they interact with their team.

Why assess situational experience and domain knowledge?

Situational experience gives leaders the ability to adapt their approach to management based on specific circumstances, which are usually dictated in the value creation plan. For example, entering new markets, digitisation and internationalisation. This type of experience will have been gained through various leadership positions, diverse organisational settings and challenging projects. A solid understanding of situational experience enables leaders to make informed decisions when faced with unique problems and better navigate the complexities of the tech industry.

Domain knowledge, also referred to as domain experience, plays a crucial role in a leader's ability to identify opportunities, anticipate challenges and devise effective strategies within the technology sector. A strong understanding of the specific technologies, tools and frameworks within their industry allows for better decision-making and problem-solving capabilities.

In the tech sector, leaders with robust domain knowledge have a competitive advantage. This expertise allows them to better evaluate the effectiveness of certain processes, recognise potential technical hurdles, and identify solutions that align with their organisation's goals. 

How to develop future leaders internally

In any sector, development strategies must be a mix of traditional and personalised learning, including relationship-based methods such as coaching and mentoring. Research shows that 75% of students forget what they've learned within six days if they don't apply it in the flow of work. 

Time-poor executives also need to be reached where and when they are available and able to focus, which means offering multichannel learning development, made possible with technology. Creating an effective leadership development programme means deploying of a mix of different learning opportunities and methods, including:

• Self-paced e-learning – Access to on-demand online courses can help build technical skills, introduce leadership concepts and techniques such as: giving feedback, delegating, encouraging psychological safety, building trust etc. E-learning through various apps can help track progress through a lesson, acting as an audit trail for development managers and learners to look back on past learnings.

• Continual professional development courses (CPD) – Continual professional development (CPD) helps future leaders enhance skills and leadership techniques at any point along their career. Some roles within regulated sectors require CPD to stay up to date and retain professional association memberships and accreditations, for example in education and healthcare. It can involve taking a training course, attending an educational event, or studying for technical qualifications. .

• Mentoring – Pairing potential leaders with leaders who are strong in the competencies they are weak in, or letting them shadow those who have hands-on experience in the target role will help show learners the realities and unique challenges of the job. Offering facetime with a senior manager is highly attractive to future leaders, which is why mentoring works so well. Read more about the impact of mentorship in tech here. 

• Job rotations – Identifying a high-potential future leader and rotating them through temporary roles will give them a broad understanding of the business and various departments’ needs and unique challenges. It’s highly valuable for a leader to be able to show an understanding of their employees’ different contexts.