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Keeping leadership on track – feature


This feature was contributed by Roy Davis, Head of Communications at SHL Group.

There was a time when organisations could sleep soundly at night assured of the long-term loyalty of their senior managers and chief executives. However, the dynamics of the workplace are changing and today's companies are running scared.

Unlike management, leadership is a high-risk activity with failure signalling disaster for the entire organisation. The press is full of stories of companies that have fallen victim to leadership derailment and paid a costly price. This is evident when you consider that the average tenure for a global CEO currently stands at just 2.75 years with the financial impact of replacing them typically estimated to reach £700k.

In search of tomorrow's leader
A changing model of leadership is evolving. The much admired, stalwart pioneers and hard-nosed tycoons of yesteryear are moving aside for a new breed of inspirational, dynamic leaders. These multi-skilled, innovative team players are stepping up to be the resilient and flexible leaders of tomorrow. However, perhaps most significantly, they are not sticking around to reap the long-term benefits.

So, why do leaders have such a short shelf life? Is it due to short-term pressure, under-performance, lack of capability or poor recruitment and development procedures?

The rapid turnover of high calibre executives highlights a couple of areas of concern. Firstly, it reflects the fact that today's highly tuned leadership competencies are scarce, making the recruitment of skilled senior professionals more difficult. This is further supported by the government's recent CEML report that warns of a severe soft skills deficit at senior management level.

Secondly, problems appear to lie with existing recruitment and development procedures. The higher up an organisation you go, the greater the consequences and impact of a poor appointment. However, the irony is that even though the case for using a robust appointment and support process is at its strongest it usually falls very short. It is a startling observation, but organisations typically take more time and spend more money recruiting a graduate than a CEO. The misconception is that at senior executive level word-of-mouth appointments are infallible. This is commercial suicide.

This approach is epitomised by parachuting in a replacement from outside an organisation when recruiting or replacing senior management. The "I know a man who…" scenario. A carbon copy of the previous incumbent and/or someone with a track history of similar roles is usually appointed to 'carry on the good work'.

Gauging 'good' and trying before you buy
Unfortunately, history is not a foolproof predictor of the future and yesterday's skills are not necessarily appropriate, or applicable, to tomorrow's needs. This approach is clearly no longer a sound recruitment device. With the increasing importance placed on leadership as a skill, organisations require better recruitment methods with the rigour of the techniques reflecting the importance of the role.

So, how do organisations ensure that they appoint the most capable people into senior positions? Quite simply, they need to know what 'good' looks like and be able to identify it when they see it. This then allows them to establish the best 'fit' for the job. For example, does the Chairman operate a tight knit or free flowing agenda? Depending on the answer, board members in an executive team will require different behaviours and skills.

It's common sense. No self-respecting chairman or chief executive should appoint a senior leader on the basis of an interview and track record alone. The use of innovative, integrated and objective assessment and appraisal tools and techniques in selection processes to 'test drive' the candidate pool is fundamental in helping achieve the closest possible match between an individual and the role to be fulfilled. For example, asking a candidate to chair a meeting or make a formal presentation in advance of an appointment should be advocated. This output can then also be used as the basis for ongoing developmental planning if they are selected.

If organisations don't know what good looks like then they will also be blind to the capabilities of existing employees. The chances are, Superman or Wonder Woman is alive and well, already working in your company, and just waiting for the opportunity to make a difference.

Long-term leaders
As well as exercising caution when choosing leaders, organisations need to work harder than ever to retain them. Identifying best 'fit' skills is all well and good but only if the leader is supported - particularly in the first 100 days. If this is lacking all the commitment, time and placement costs invested up to that point stand a good chance of going to waste, allowing the organisation to rue its costly mistake at leisure.

In order to keep leadership on track, forward-thinking companies are therefore refocusing their executive recruitment strategies and increasing development budgets to mitigate the risk of leadership failure. One thing is certain; the financial pay-off from avoiding poor recruitment decisions substantially outweighs any costs associated with of the recruitment, assessment and development process.

Debunk the myth - the old boy network is dead. Long live effective senior level recruitment and development.


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