Ten Reasons Why Senior Appointments Succeed or Fail
Signium’s executive search and leadership consulting purpose is to help organisations make the best possible hiring decisions and recruit and develop leaders who will be set up for success. We are therefore always interested to learn the real reasons why appointments succeed or fail.
At our recent networking evenings in London and Beaconsfield, we asked our diverse panel of experts to talk from their own experience to a wide audience of business leaders about successful transitions into new roles, and also to share when things had not gone so well for them.
Why Transitions Succeed
- Building Relationships Based on Trust
One business leader’s interesting personal journey had taken them from a large global conglomerate with extensive publishing interests to run a personal care business in the Far East for a company headquartered in Dayton, Ohio. To illustrate the extent of the cultural challenge, he said that he was working with a Sales Director who had not only never been outside the US, but had never seen the sea! He stressed that to accomplish this kind of transition successfully required an open mind and preparedness to build personal relationships based on trust.
- Preparing & Learning the Culture – the CEO-in-Waiting
A panellist with broad experience in the food and fmcg sectors described how he was successfully recruited as a CEO-in-waiting. His ambition was to become CEO, but he was told that he could not do this immediately, and would first need to undertake a divisional role running a part of the business. This helped him to establish himself in the business and immerse himself in their culture before taking on the CEO role. His confidence was bolstered because he knew one of the NEDs well and therefore knew that he was personally well supported on the Board.
- Recruiting for Potential – 70% Ready
Another panellist with experience as both a general manager and HR leader described how his two biggest career opportunities had come as something of a surprise because his employers had taken ‘leaps of faith’, when he might not have been regarded as fully ready for the move. As an HR Director in the construction sector, he has supported an approach of ‘70% ready’, because he recognises how powerful this can be in releasing potential. The key thing is to identify whether the essential capability is in place. For example, in his promotion to general management he was given a chance with a unfamiliar new customer base, but he had already held P&L responsibility so was confident to rise to the challenge.
Paul Surridge, the head of our leadership consulting practice, explained that he spends a lot of time helping senior leaders and organisations to navigate the making of a ‘leap of faith’. He said that whilst his work was frequently centred on trying to predict what leaders might turn out to be like in the future, it was striking how few companies knew what they wanted them to be like to start with. He commented on his own transition from a small paternalistic Swedish business into a global US owned consultancy where everything was time-sheeted. The culture was dramatically different and he sometimes felt like he was able to work ‘in spite of the organisation’. People can adapt to different cultures, so often you do look for people who can find their own way.
A panellist whose career had been developed with one of the largest global fmcg players talked about her own transition into a privately owned business. She had to adjust and realise that only some of her toolkit from a very large corporate was applicable.
Paul navigated a successful career change himself, because there was a good alignment between his own adaptability and the consultancy which he joined. They were deliberately seeking people with different backgrounds and perspectives. They invested heavily in a six month induction process and provided mentoring support from day one.
- Low Ego
An HR Director from the fmcg sector said that she had spent a lot of time with her organisation looking at what enables leaders to thrive and grow; what are the derailers and what are the accelerators? One of the primary determinants of success that they had identified in their culture is a relatively low ego. ‘It’s a derailer if it is all about them, because the company is about team’.
Our panellists were asked about approaches to diversity in recruiting senior leaders. There was consensus that that the best hires should not be ‘photo-copies’ of the existing leadership, but must be able to work successfully with the culture in the organisation. One of the panellists said that you must recruit to the future and recognise that every recruitment shifts the dynamic of the organisation, recalling that in her last position they changed every single role in their leadership team.
An interesting challenge can be recruiting one’s own successor. Our Financial Services Chief Executive described recruiting a financial controller for their retail business whose approach was quite different (‘grittier’) to his, but was what the business needed at the time.
Our Italian correspondent, who had experience of opening and running a UK subsidiary, spoke passionately about the challenges of orchestrating a market entry with high expectations from corporate centre and limited resources on the ground. He stressed the importance of recruiting local talent and concentrating on selecting for competencies and attitude rather than experience
Derailers – Why Transitions Can Fail
- Not Owning the Selection Decision
It is vitally important for key stakeholders, but especially the person sponsoring a recruitment, to retain their focus. One panellist described how in his internal promotion to CEO with a PE backed leisure retailer, he was responsible for recruiting his successor as Commercial Director. The headhunters produced a very impressive ‘whacky candidate’ who he described as an ‘international polyglot’ from a big grocery retailer. Unfortunately it proved a disastrous appointment, as she was used to a heavily resourced consensus environment and simply did not fit with a fast-paced entrepreneurial culture. He acknowledged that he did not complete his due diligence and referencing, which would have revealed this.
- Over-Promoted or Under-Supported?
People are often said to have been over-promoted when we should really recognise that they have been under-supported. One HR Director commented that success is highly contextual and looks different in different places. For example, they recruited a Business Unit MD who had been successful in a place with a comprehensive written rule book, whereas they wanted someone who would be entrepreneurial and dynamic. The recruit went out networking and lost their team. In retrospect, the problem was caused by a failure on the part of the business to explain how they operated. Because this is something businesses tend to struggle with, he said that in interviewing leaders he is particularly interested in their EQ and focuses on their inquisitiveness and ability to describe how the team makes decisions.
It is always important to remember that leaders transitioning their teams are also going through a transition. The temptation can be to rush to action, one of our HRDs said. With general manager hires, she wants to take time with them to work out how to develop the future together. She works with them to understand how their leadership works in different situations.
- Poor Induction - ‘40% of Senior Hires Fail in 12 Months’
Our healthcare MD pointed out that 40% of people in new roles are reported to fail in the first 12 months. The issue appears to be mostly with what happens after the selection has taken place. The attitude that ‘if you are good enough to have been chosen, you are good enough to get on and do the job’ is letting people down. In reality, recruits really need to plan all their interactions with stakeholders; day one, week one, month one. This process should start as soon as someone is appointed in a new job; they should engage and plan their entry with the people they are going to work with. So the advice to candidates was clearly not to rely on a sequence of induction meetings planned for you; ‘take control’.
- What Can Headhunters Do Better?
What can headhunters do once a candidate has been chosen, to help the appointed person be a success? One panellist commented that employers and candidates are both on best behaviour at interview. Once employed, they return to normal. Search consultants should try to understand what ‘normal’ is for both parties so that they can get to know each other more successfully in the process. They should promote social interaction, such as dinner in an informal context, as part of the recruitment process. Another commented that there was no substitute for large and agreed due diligence, and that staying in touch over the first six months would be useful. One HRD went so far as to say ‘formalise the 90 day coaching’.
What is clearly very important in any transition is whether there is a shared vision and whether there are shared values between the recruit and the hiring organisation. We found a heavy emphasis on soft skills and emotional intelligence, but employers also need to step up and provide the right context for leaders to succeed. Signium’s FIT process can help to de-risk this transition process for both parties.
We would like to thank our eminent panellists and our guests for their contributions to these very interesting discussions. If you would like to be included in our future networking events, please let us know via an email to email@example.com
The CEO of a Financial Services member organisation
A marketeer turned HR Director from the food retail sector
Paul Surridge, Head of Signium’s international Leadership Consulting Practice
A University Chair with an earlier career as MD in publishing; consultant in executive on-boarding
The UK MD of Italian drinks brand
The CEO from a private equity backed leisure company
A Group HRD with an engineering and supply chain background in food and fmcg
An HRD with change management expertise and experience as a general manager in engineering, mining, construction, publishing and auctioneering.