Complex and changing business conditions require that talent managers identify and develop leaders who possess the rare ability to thrive under pressure.

The Dallas Mavericks and Miami Heat square off this week in the NBA Finals to determine which team will be basketball’s 2011 champion. This action-packed, championship series often hinges on a single bad pass or key play that can turn the tide and send the winner into rapture and the loser home in disappointment.

CEOs today find themselves in a similar pressure-packed environment, argues Justin Menkes, an executive assessment expert, consultant for executive search firm Spencer Stuart and author of the recently published book “Better Under Pressure.” But instead of a tense series of seven games, corporate leaders face rapid change and the relentless challenges of a complex business environment all the time.

“From every corner of the world, you’re getting more competitors that are emerging from somewhere that you never thought of,” Menkes said. “And then they’re coming up with different ideas to try to disrupt your business. You add all that together and the world is more complicated.”

Successful CEOs are able to perform at their best in turbulent conditions and get the most out of their people. Based on interviews with more than 60 CEOs at large companies like Avon, Yum! Brands, Southwest Airlines and Procter & Gamble as well as performance evaluations of 200 CEO candidates, Menkes identifies three traits that set successful leaders apart:

  • Realistic optimism: Recognition of limitations and the confidence to still have an impact.
  • Subservience to purpose: Clearly identified goals that serve as a yardstick and motivation for success.
  • Finding order in chaos: The ability to tackle multidimensional problems and bring clarity to complex situations.

Using these three traits, successful leaders constantly seek to develop their own potential as well as that of their employees. They motivate and lead others to success, much like a conductor directs the many different members of an orchestra to create music in symphony.

“The three attributes are how they bring out the patterns they use over and over again to put onto these circumstances,” Menkes said.

Few leaders are natural masters. In most cases, talent managers can identify the seeds of these traits and create experiences and tools to develop the ability to thrive under pressure. For starters, Menkes recommended putting leaders into situations that stretch them and force them to develop these skills under pressure. Then engage them in active inquiry by asking what they learned and what they would have done differently before escalating the challenge.

“As they ask these questions along the way, they’re going to learn a lot about the individual and what they need to do to grow,” Menkes said.

As they develop leaders with the ability to thrive under pressure, it’s also important that talent managers continually re-evaluate the succession plan. According to a recent survey of 1,600 senior HR managers by U.K.-based The Chartered Institute of Personnel and Development (CIPD), fewer than half (48 percent) of organizations report they have a good succession plan in place and only 29 percent are confident they do. Respondents cited uncertainty over future requirements as one of the most common reasons for the lack of a succession plan.

“The business’s challenges evolve over time and they really aren’t updated enough and focused enough on the individuals involved and where the business is changing,” Menkes said.

Talent managers should also examine the extended team developing around future leaders. CEOs who thrive under pressure are surrounded by a team of senior leaders who underpin their success.

“They’re not just one individual coming in. Every context is different so you want to make sure they are complementary because nobody brings everything to the table,” Menkes said.

Successful CEOs are often innately blessed with these three leadership traits, but they are also carefully prepared to thrive in pressure-packed situations. The rare basketball player takes to the court and immediately leads the team to success. More often than not, players learn through tough losses what it takes to be a champion: the ability to adapt to constantly changing conditions and make mid-course adjustments. The same goes for CEOs.

“It doesn’t matter how talented you are. If you haven’t been prepared properly, it will get the best of you,” Menkes said.

Mike Prokopeak is vice president and editorial director for Talent Management magazine. He can be reached at mikep@talentmgt.com.