I had an opportunity to read a literature review from last year that drew some pretty interesting conclusions not only for the U.S., but worldwide.
Steven Zaccaro, in his piece, Executive Talent Assessment and Selection: A Literature Review described a five step process.
Defining executive candidate position requirements (technical skills)
Delineating appropriate candidate attributes (cultural fit)
Recruiting the candidate pool
Assessing the candidate pool
Making the final decision and "onboarding" the successful candidate
He goes on to say that the failure rate for executives is extraordinarily high and that failure to spend appropriate time on all of these elements is a probable cause.
He has some pretty good data to back him up. He cites the facts that CEO's hired after 1985 were 3 times more likely to be fired than those hired prior to that date and that the overall turnover rate for CEO's has from 6% in 1995 to 14% in 2002. In case your conclusion is so what, there is a direct correlation between CEO performance and organizational performance that has been documented by everyone from Jim Collins in Good to Great to the Department of Labor.
Another source describes the failure rate of new managers as exceeding 40% in the first 18 months. The costs of turnover is estimated at between two and five times annual salary in "hard" costs, so we aren't talking about a tempest in a teapot.
He shares some pretty interesting insights as to the causes of these failures as well. Succession planning in most organizations is frankly reactive. People don't like to consider and plan for their own departure. Another reason is that while many C level people are gifted business leaders and strategists; selection and placement are not core competencies for them. A study by Drucker shows them to have about a 33% success rate at choosing their own successor.
The literature indicates that when it comes down to it executive search committees tend to rely on their own "gut" instincts, select candidates who "mirror" their own attributes, and other human tendencies in making their selections. The least reliable indicator of success is an interview without other validating information. Similarly "track records" aren't always reliable unless the organization is facing similar challenges and an operating environment to the one the candidate faced. The skills sets at each level of management and leadership also become increasing complex- success as a middle manager or operational executive is not necessarily indicative of success at the higher level.
Last week I talked about the "leadership crisis" with something approaching 50% of middle managers rejecting providing "clarity", direction, and attending to morale issues as being their responsibility. When does the recognition that these responsibilities are part of their job occur if not built into the process? Correspondingly we know that highly engaged employees outperform their colleagues by a rate of 21% and that the "engagement" factor is synergistic to total organizational performance. The number one criteria for engagement is clarity.
Since many of our CEOs and other key executives come from "within" I don't think we can discount our investment in the process of their recruitment, selection, and development either.
So I guess it might be time to ask ourselves when we are ready to accept the idea that using the same process over and over and expecting a different result is a bit silly. Given the state of our economy, the costs of "presenteeism", and turnover shouldn't we consider making some changes?
Wednesday, December 30, 2009
Monday, December 21, 2009
Recruiter As Partner
I had a chance to listen to a recent interview with the director of an online executive job posting site from Australia as she was asked about the continuing relevance of recruitment agencies and search firms given the proliferation of web based recruitment sites, and I have to tell you she provided some great insights. Those Aussies are pretty damn clever. Many of us may not be aware, but they avoided most of the recent financial crisis.
One of the places she starts the discussion is the idea unless you are using very targeted websites the space out there is pretty “noisy” or generalized. You may not be getting your posting in front of the right candidates. She points out that unless you are searching for pretty standardized or “benchmark” jobs both these sites and your own human resources department may not be your best strategy.
High level search firms are specialists. This is what they do day in and day out; it isn’t an ancillary activity to them. She makes an interesting reference to Jim Collin’s iconic book, From Good to Great, and tracking the history of what made for enduring great companies. Not surprisingly one of the key differentiators is the acquisition and retention of the right talent; as Collins referred to it “getting the right people on the bus”. For many businesses this can represent a significant challenge. Recruitment and selection is probably not your core competency.
There are some other things that she presents that represent excellent value points as well. One of them is regarding the use of “screening software”. She feels, and I agree is that the problem with this software is that focuses primarily on “technical” skills. It is typically the intangibles or soft skills that cause failure or success. Very few candidates fail because they were technically unqualified for the role; the issue is one of “fit”.
Another area she focuses on is the job specification or “brief”. In many cases this is represented by a job description and salary range. I can tell you after over 30 years as an HR executive and consultant those are woefully inadequate. They rarely convey the values, key attributes, and “soft skills” really necessary to do the job. A really good profile includes all of those elements and that requires some upfront work. I firmly believe that the most important part of the process is the upfront process of really “defining” what the successful candidate is going to look like.
I can see some of you rolling your eyes already about the time that this involves, so let me share a couple of statistics with you.
· 40% of new managers fail within the first 18 months of their promotion or reassignment, usually for non-technical reasons.
· The estimated costs of a “wrong hire” range from 2 to 4 times annual salary, and that is just the hard costs.
· “Engaged” employees tend to be 21% more productive than neutral employees and are 60% less likely to seek other employment.
· Over the next 10 to 15 years, the demand for experienced talent is expected to increase by 25% while the supply decreases by 15%.
The other interesting phenomenon is that “engagement” begins in great organizations during the hiring process. They don’t try to teach people to embrace their values and norms; they build it into their selection and development process! As a colleague of mine says “Hire hard, manage easy”.
Let’s be honest with each other. In most of our organizations our hiring is typically reactive. We need additional staff or someone leaves and we begin to look for applicants. In many cases that process is one of urgency if not panic. We need a body; we have not really stopped to think about succession, long term investment, or fit.
If we go back to Collins and Good to Great, those organizations were good at recognizing and acquiring talent proactively.
If you explore that paradigm your sourcing organization goes from “vendor” to partner. They aren’t responding to a crisis, they are “scouting” on your behalf. They have an intimate knowledge of your organization and your culture and they are seeing potentially hundreds of candidates each year that you or your HR department are likely not aware of and presented with. They are transitioning from performing a task to providing consulting to your organization on the key areas of the acquisition and retention of key talent.
I am not going to tell you that every search firm or recruiter offers this kind of sophisticated view and capability. Just as selecting a candidate or an executive coach you need to seek out that “fit”.
I will leave you with this thought. Think about a situation where the best team; defined as possessing not only the skills and attributes, but also the commitment and passion didn’t ultimately prevail, I can’t remember one…
One of the places she starts the discussion is the idea unless you are using very targeted websites the space out there is pretty “noisy” or generalized. You may not be getting your posting in front of the right candidates. She points out that unless you are searching for pretty standardized or “benchmark” jobs both these sites and your own human resources department may not be your best strategy.
High level search firms are specialists. This is what they do day in and day out; it isn’t an ancillary activity to them. She makes an interesting reference to Jim Collin’s iconic book, From Good to Great, and tracking the history of what made for enduring great companies. Not surprisingly one of the key differentiators is the acquisition and retention of the right talent; as Collins referred to it “getting the right people on the bus”. For many businesses this can represent a significant challenge. Recruitment and selection is probably not your core competency.
There are some other things that she presents that represent excellent value points as well. One of them is regarding the use of “screening software”. She feels, and I agree is that the problem with this software is that focuses primarily on “technical” skills. It is typically the intangibles or soft skills that cause failure or success. Very few candidates fail because they were technically unqualified for the role; the issue is one of “fit”.
Another area she focuses on is the job specification or “brief”. In many cases this is represented by a job description and salary range. I can tell you after over 30 years as an HR executive and consultant those are woefully inadequate. They rarely convey the values, key attributes, and “soft skills” really necessary to do the job. A really good profile includes all of those elements and that requires some upfront work. I firmly believe that the most important part of the process is the upfront process of really “defining” what the successful candidate is going to look like.
I can see some of you rolling your eyes already about the time that this involves, so let me share a couple of statistics with you.
· 40% of new managers fail within the first 18 months of their promotion or reassignment, usually for non-technical reasons.
· The estimated costs of a “wrong hire” range from 2 to 4 times annual salary, and that is just the hard costs.
· “Engaged” employees tend to be 21% more productive than neutral employees and are 60% less likely to seek other employment.
· Over the next 10 to 15 years, the demand for experienced talent is expected to increase by 25% while the supply decreases by 15%.
The other interesting phenomenon is that “engagement” begins in great organizations during the hiring process. They don’t try to teach people to embrace their values and norms; they build it into their selection and development process! As a colleague of mine says “Hire hard, manage easy”.
Let’s be honest with each other. In most of our organizations our hiring is typically reactive. We need additional staff or someone leaves and we begin to look for applicants. In many cases that process is one of urgency if not panic. We need a body; we have not really stopped to think about succession, long term investment, or fit.
If we go back to Collins and Good to Great, those organizations were good at recognizing and acquiring talent proactively.
If you explore that paradigm your sourcing organization goes from “vendor” to partner. They aren’t responding to a crisis, they are “scouting” on your behalf. They have an intimate knowledge of your organization and your culture and they are seeing potentially hundreds of candidates each year that you or your HR department are likely not aware of and presented with. They are transitioning from performing a task to providing consulting to your organization on the key areas of the acquisition and retention of key talent.
I am not going to tell you that every search firm or recruiter offers this kind of sophisticated view and capability. Just as selecting a candidate or an executive coach you need to seek out that “fit”.
I will leave you with this thought. Think about a situation where the best team; defined as possessing not only the skills and attributes, but also the commitment and passion didn’t ultimately prevail, I can’t remember one…
Are You Hiring The Right People
As a consultant and executive with my formative background and education in human resources management, I typically have a semi facetious response to executives and business owners who ask me what differentiates great companies from “good companies”. My response is “It is the people, stupid!” The organizations with the best people aligned in the best way always win. This is especially important to those you running small businesses, where every hire is a critical hire!
So how do we define the best people? I have a couple of recommendations for my clients.
· Identify Key Attribute for Success and Hire “Right”
· Incorporate Responsibilities Into All Job Descriptions
· Provide Appropriate Training
· “Retrofit” Skills and Attributes of Existing Staff
· Coach and Mentor
So what do I mean by all that “HR stuff”? Very simple, I want everybody on my team to share some common attributes:
So how do we define the best people? I have a couple of recommendations for my clients.
· Identify Key Attribute for Success and Hire “Right”
· Incorporate Responsibilities Into All Job Descriptions
· Provide Appropriate Training
· “Retrofit” Skills and Attributes of Existing Staff
· Coach and Mentor
So what do I mean by all that “HR stuff”? Very simple, I want everybody on my team to share some common attributes:
1. Commitment To The Team
2. Ability To See The Big Picture
3. Ability To Learn And Share New Skills
4. Listening For Key Information
- If they can’t or won’t do these things or lack these attributes, I don’t want them on my team – period.
There are reasons why I have focused on attributes rather than skills. You have probably heard some of these before but they bear repetition.
-You can teach smart people to do almost anything!
-It is hard to teach people to be smart!
- People who are committed to your mission will reflect it!
Again, in my sarcastic way, I have compared trying to violate these “truths” to trying to teach your dog to sing. It just exhausts you and it pisses the dog off.
People who know me would tell you that patience is not always one of my most noticeable virtues. However, when I have been called in to “retrofit” a number of cultures, I believe there is a very respectful way to go about doing that – a way that requires patience to bring about the desired changes. I believe that companies have the right to define their cultures as long as they do so within the context of the law and are respectful to all employees.
While businesses and most organizations are not democracies, I do suggest to all business owners and leaders that, beyond the attributes that I mention above, they need to ensure that everyone in a leadership role either possesses or is trained in some key skill sets:
Establishing Clear Performance Expectations
Giving Periodic, Constructive, and Clear Feedback
Taking Appropriate Corrective Action
I can honestly tell you that, if 90% of management had mastered and demonstrated these skills on a consistent basis, at least half of the management consultants in the world would be unemployed. You will notice that none of these skill sets address technical skills like financial analysis, marketing, etc. That is not an oversight. Technical skills are task competencies and can be taught. You can have excellent technical skills and be an awful manager. If you don’t believe me, ask staff if they would rather work for a manager who consistently performs my list or a manager who is technically “gifted.”
I believe that employees have an absolute entitlement to four and only four things-
Respect For Individuals
Clear Expectations
Meaningful, Balanced Feedback.
Equitable , Clear Reward System
People have said to me “What about empowerment and development, and mentoring?” I think those things are awesome and contribute to growing organizations and reinforcing commitment, but the first four are absolute entitlements that form the basis for the others.
I also encourage clients to “re-recruit” existing staff using the following model:
Train Current Staff Must On New Competencies And Expectations
Compliance Works Short Term But Commitment Is Essential For The Long Term
Retrain, Re-Assign, or……..
Remember WIIFM (What’s in it for me!)
In the long term, you simply cannot tolerate performance that won’t or can’t meet your expectations. Asking or forcing people to leave your organization is hard on them, on you and on their colleagues, but leaving them in a role where they are not thriving or happy is worse. That’s why I suggest we hire right up front. If you do you reap the rewards.
In the words of Jack Welch-
“If you pick the right people and give them the opportunity to spread their wings and put compensation as a carrier behind it you almost don't have to manage them.”
Now you have to admit, that it is a pretty exciting thought!
It's The People!
“People join and support a culture not a system. Long term success will only be achieved and sustained when employees believe that embracing a culture is in their best interests and the interests of their customer. Changing systems without changing culture will not sustain long term success.”
Mark F. Herbert March 2008
Everybody that knows me knows that I essentially see myself as being in the people business.
The art and science of identifying the right people whose values are aligned with your organizational culture and values; and ensuring that over time they don’t lose that alignment.
Over the last 30 years I have learned a very important fact. Hiring the "right" people is a way better strategy than trying to teach them to be "right".
Over the last several months I have written volumes about engagement, the “phenomena” of perfecting that alignment in your organization and nurturing it beginning with your employees and then building on that base with your customers, suppliers, and community.
Years ago I quoted an article that indicated 40% of new managers fail within their first 18 months because of their inability to build and sustain relationships. I don’t think we have improved our track record much. We still use leadership and management as interchangeable concepts and skill sets; they aren’t and never will be.
I read a comment recently on LinkedIn, a very popular business/social networking site, that he felt the U.S economy would never regain its international leadership position again because of the “limited” productivity of American workers. He mentioned that companies were off shoring to take advantage of lower wages, better technically educated workers, and less restrictive environments. I think he is very wrong. The American worker hasn’t failed, our leadership model has failed! We have become increasingly reluctant to examine and deal with root cause issues.
I have previously written a lot about culture change and creating a culture of commitment and engagement and the critical elements for making that happen. I would like to think some of you are familiar with a few of them:
· Hire the right people
· Incorporate the elements of commitment rather than compliance.
· Be flexible about process and ruthless about principle.
· Build on a foundation of trust.
· Remember it is all about relationships.
Your employees are adults. One of my cornerstones of building commitment based relationships is respect. Respect is based on honesty. Treating employees like children is neither respectful nor honest. By being honest and forthright you also build the foundation for collaboration. Remember my set of questions? It is interesting if you ask them and give them an opportunity to participate how employees can provide excellent ideas as to how to cut costs, increase productivity, and even come up with alternatives to reducing staff or minimizing the reduction. You have to have a relationship. You have to ask and listen.
Mark F. Herbert March 2008
Everybody that knows me knows that I essentially see myself as being in the people business.
The art and science of identifying the right people whose values are aligned with your organizational culture and values; and ensuring that over time they don’t lose that alignment.
Over the last 30 years I have learned a very important fact. Hiring the "right" people is a way better strategy than trying to teach them to be "right".
Over the last several months I have written volumes about engagement, the “phenomena” of perfecting that alignment in your organization and nurturing it beginning with your employees and then building on that base with your customers, suppliers, and community.
Years ago I quoted an article that indicated 40% of new managers fail within their first 18 months because of their inability to build and sustain relationships. I don’t think we have improved our track record much. We still use leadership and management as interchangeable concepts and skill sets; they aren’t and never will be.
I read a comment recently on LinkedIn, a very popular business/social networking site, that he felt the U.S economy would never regain its international leadership position again because of the “limited” productivity of American workers. He mentioned that companies were off shoring to take advantage of lower wages, better technically educated workers, and less restrictive environments. I think he is very wrong. The American worker hasn’t failed, our leadership model has failed! We have become increasingly reluctant to examine and deal with root cause issues.
I have previously written a lot about culture change and creating a culture of commitment and engagement and the critical elements for making that happen. I would like to think some of you are familiar with a few of them:
· Hire the right people
· Incorporate the elements of commitment rather than compliance.
· Be flexible about process and ruthless about principle.
· Build on a foundation of trust.
· Remember it is all about relationships.
Your employees are adults. One of my cornerstones of building commitment based relationships is respect. Respect is based on honesty. Treating employees like children is neither respectful nor honest. By being honest and forthright you also build the foundation for collaboration. Remember my set of questions? It is interesting if you ask them and give them an opportunity to participate how employees can provide excellent ideas as to how to cut costs, increase productivity, and even come up with alternatives to reducing staff or minimizing the reduction. You have to have a relationship. You have to ask and listen.
Ask for Help
I believe great leadership is about building teams, trusting my staff, and recognizing that it is about collaboration not genius. I have never seen micro management as a successful management model. I have never met anybody that had all the answers.
It is always interesting to me when leaders are unwilling to engage their employees in problem solving and decision making. It causes me to ask some questions:
· Do we hire stupid people?
· Do we “train” them to be stupid once they get here?
· If they were or became stupid (I can’t trust them or rely on their judgment) why do keep them?
· Do I really believe I or my executive team is smarter than everybody else collectively?
· If I don’t give them an opportunity to participate in the decisions how can they contribute or learn?
I believe great leadership is about building teams, trusting my staff, and recognizing that it is about collaboration not genius. I have never seen micro management as a successful management model. I have never met anybody that had all the answers.
It is always interesting to me when leaders are unwilling to engage their employees in problem solving and decision making. It causes me to ask some questions:
· Do we hire stupid people?
· Do we “train” them to be stupid once they get here?
· If they were or became stupid (I can’t trust them or rely on their judgment) why do keep them?
· Do I really believe I or my executive team is smarter than everybody else collectively?
· If I don’t give them an opportunity to participate in the decisions how can they contribute or learn?
I can't guarentee you that if you follow the advice I have provided here it will make you successful, but I truly believe hat a group of people aligned in purpose with the right talents and abilities is one of the most important forces in the universe. At the end of the day it comes down to people, the right people!
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