In my last blog, Help Wanted in the C Suite, I mentioned that one trend that we are seeing within the PI® client base, as well as the labor market as a whole, is a sharp spike in executive-level hiring, with former H-P CEO Mark Hurd landing on his feet at Oracle a recent example ( http://www.oracle.com/us/corporate/press/170532 ).
As companies make executive-level hiring decisions, they may want to keep the following in mind:
- Executive failure is common. Estimates vary, but perhaps only one-third of executive selection decisions could be considered truly successful. This abysmal “batting average” occurs across industries and countries.
- The “job” of an executive is more difficult than ever before, for a number of reasons. Executives are under increasing pressure to deliver stronger financial results, and to do so more quickly than ever before. They also have to deliver those results in an increasingly public way, in which seemingly trivial actions are subject to comment and evaluation via Twitter, facebook, etc. In the words of one executive that I’ve worked with “More and more I find myself playing the role of a leader, as if I’m working in theatre. Maybe I should have gone to acting school instead of business school.”
- The performance of executives: (1) can be predicted within a reasonable range of certainty and (2) matters a great deal. Some people have argued that neither of these are the case, in effect saying that large parts of a given executive’s success or failure are basically random, impacted by changes in the external business environment, etc. Or they argue that in comparison to the many other things that may impact the success of an organization, individual executive performance matters relatively little. I disagree with both of these points.
In my experience, when things have gone “right” in executive selection, most, if not all, of the following have occurred:
- ✓ The company takes a “tripartite” approach to selection – asking careful questions about what they need to know about the job, the organization and the candidates under consideration.
✓ People involved in the selection decision are aware of and are candid about their own decision-making and judgmental biases and errors, many of which humans in general are subject to.
✓ An executive’s success (or failure) is evaluated on an expanded timeframe (often between three and five years, if not more), and the concept of “success” is viewed dynamically, not statically.
✓ The consideration of “fit” is of paramount importance. In comparison to a given executive-level job opening, what are the individual candidates’ goals, experiences, personality, skills and competencies, and how much of those are “transferable” to the current situation? For example, what is each candidate’s ability to be effective in your company’s unique corporate culture? Remember, executive-level success in Company A does not necessarily translate to Company B.
✓ Many companies mistakenly assume that executives and executive applicant pools do not vary much with regard to cognitive ability and personality traits. Data indicate that this is not the case, with the amount of variability on these dimensions among executives largely mimicking that of the general working population. Thus, there is a great opportunity for structured, well-validated tests of domains such as personality, cognitive ability, interests and values to add significantly to the effectiveness of executive selection decisions.