PurposeThis paper aims to present research‐based insight on the significance of building self‐awareness and self‐efficacy as foundation to other forms of leadership developmentDesign/methodology/approachThe research is taken from a two‐year interpretive study conducted in the Australian rail industry aimed at establishing a unified approach to developing rail leaders. Using mixed methods, seven major rail organizations contributed to detailed case studies, online surveys and in‐depth interviews at various levels of management.FindingsThe findings support a new variation of leadership capability that has emerged and is being applied in organizations where managers are empowered to create and define their own work roles. In order to achieve this autonomy, a higher level of self‐awareness and self‐efficacy is essential. Self‐awareness requires the leader to use a wide range of cognitive processes such as: focussing attention and evaluating current behaviour to internal standards and values; recognising their personality characteristics, strengths and weaknesses; and, having a clear perception of their emotions and self‐esteem. Importantly, leaders need to know how they relate to others, how they communicate and what makes them happy.Research limitations/implicationsThe findings are contextual and may not fit all settings, but they offer a comparative account of leadership development in an industry facing perpetual change, economic challenges and a shortage of leadership talent.Practical implicationsThe paper has practical implications for human resource practitioners and professionals involved in the implementation of leadership development programs. Leadership is a global priority and organizations need to get much better spotting and developing leadership talent.Originality/valueThis paper will be of value to human resource professionals and managers, assisting them to think differently about leadership by focussing on an emerging underdeveloped area of leadership training and development