April 20, 2017 – Effective onboarding can make or break an executive’s success in a new role, yet an Egon Zehnder study of global HR executives and newly appointed leaders shows less than a third of organizations actively support their executives to adapt to the cultural and political climate – which rank as the top reasons new leaders fail.
With the likelihood of new executive success at risk in a competitive business environment that relies on swift leadership performance, Egon Zehnder partners Mark Byford and Lena Triantogiannis, along with Michael D. Watkins, chairman of Genesis Advisers and professor at IMD, have developed an Onboarding Effectiveness Assessment to improve new executive integration and streamline their ultimate success.
“Too many businesses believe they are successfully bringing newly hired executives into the fold, when in reality they are simply covering administrative basics,” said Mr. Byford. “That level of onboarding is outdated and largely ignores the most challenging obstacles for new leaders – unfamiliar cultural norms and expectations.” The consequences of improper onboarding, he added, include financial repercussions and talent retention issues. “Organizations must focus on getting integration right upfront to ensure new leaders succeed in today’s high-stakes environment.”
According to a global survey of senior executives who had recently transitioned into new roles, organizational culture and politics, not lack of competence or managerial skill, were the primary reasons for failure. Almost 70 percent of respondents pointed to a lack of understanding about norms and practices — and poor cultural fit was close behind. When asked what would reduce failure rates, they emphasized constructive feedback and help with navigating internal networks and gaining insight into organizational and team dynamics.
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The Five Tasks
In Egon Zehnder research and decades of experience working with executives, the global leadership advisory firm identified five major tasks that leaders must undertake in their first few critical months. These are the areas, said the search firm, in which they need the greatest integration support:
1) Assuming Operational Leadership
Even with the best possible exchange of information during the recruiting process, any leader in a new role (especially an outsider) will have an incomplete picture of the business — its strengths, weaknesses, opportunities, and threats. A new leader builds his or her credibility by demonstrating awareness of important operational issues, swiftly solving urgent problems, and identifying and achieving quick wins. Good early decisions on the ground have a material impact on his or her reputation as an effective leader.
2) Taking Charge of the Team
New leaders naturally focus on their direct reports at the outset — they know they must quickly confirm or adjust the team’s composition and goals. It is often easier to decide toward the beginning whether or not to retain people, because the team’s makeup is not then seen as the new leader’s choice.
But this window closes soon, and focus and discipline are needed to efficiently gather information for smart decisions. It’s valuable to allow a new leader to take a fresh look at the talent without coloring his or her view in advance. And it’s equally valuable to share insights about individual team members’ performance and development. Striking the right balance requires careful planning and coordination with HR and, typically, one or more facilitated sessions between the executive and the team during the first few weeks.
The goal is to create a safe environment for both to give timely, constructive feedback and to ask what may seem like awkward questions when relationships are just beginning to form. In this way any misperceptions about the leader’s words, actions, or initial decisions can be identified and clarified before mistrust or doubt about his or her values or capabilities takes hold. Building trust early with the team enables the new leader to make key decisions with confidence that people will follow through on them.
3) Aligning With Stakeholders
New leaders also need to gain the support of people over whom they have no direct authority, including their bosses, their peers, and other colleagues. Because they arrive with little or no relationship capital, they have to invest energy in building connections — and clearly signal that they know it’s a priority.
After identifying the most important stakeholders outside their teams, they must take time to understand their colleagues’ expectations and develop a plan for how and when to connect with people. That means learning how decision making works in the organization, who has influence over it, and where the centers of power reside.
4) Engaging With the Culture
It’s also critical to get up to speed on the values, norms, and guiding assumptions that define acceptable behavior in a new organization. Missing cues early on can negatively affect how others perceive a new leader’s intentions and capabilities. The executive must also walk a fine line between working within the culture and seeking to change it.
5) Defining Strategic Intent
Finally, the new leader must start to shape strategy. Sometimes executives are hired for their expertise in a particular approach; other times they are chosen for their ability to develop and implement an entirely new strategy. If a new strategy is required, corresponding elements of the organization — its structure and its talent management and performance measurement processes — must be transformed to execute it. Either way, the new leader must be clear about the path ahead.
Taken together, these five transition tasks present a daunting challenge. Stumbles in any area can lead to serious problems or even outright derailment. Effective integration is much more likely when leaders understand — before they start in their new roles — how much progress they’ll need to demonstrate in each area during the first few months. That way they can prioritize their time effectively.
Spectrum of Support
Given how critical the five tasks are to a new leader’s success, Egon Zehnder suggests that you’ll want to assess your company’s integration program by looking at how effectively you support executives in each area. Support comes in four levels:
1) Sink or Swim
Companies at this level, referred to as level zero, do little more than provide a new executive with space and basic resources such as technology and assistants. Egon Zehnder’s research shows that about five percent of global companies offer such minimal support.
2) Basic Orientation
This is level one in Zehnder’s model. It involves sharing information about company policies, team member evaluations, organizational structure, strategy, and business results. Essentially, the company provides raw data, and the new leader studies and interprets it independently. If the executive is given anything more qualitative, there is no support to ensure that its significance is well understood. The search firm’s research shows that about two thirds of all global companies still take this approach.
3) Active Assimilation
Here, at level two, the company organizes meetings with key stakeholders to accelerate a transfer of deeper knowledge about the business, the team, the culture, and strategic priorities. At most, Egon Zehnder’s research suggests, 25 percent of global companies have invested in this level of support. Although it goes beyond the bare minimum, without a shared understanding of major differences between an executive’s former context and the new one, it can be difficult to know how much meeting time will be needed. And without prior briefing, the executive may neglect organizationally sensitive issues that he or she should address.
4) Accelerated Integration
At level three — the ideal — the company orchestrates custom-designed experiences that enable a new leader to integrate more fully and rapidly. These might include team-building workshops and deep-dive discussions about strategy. The organization helps the new executive identify specific cultural challenges to be overcome, as the global communications company does with its questionnaire about previous ways of working. Despite the clear value to be gained, Egon Zehnder’s research suggests that no more than two percent of global companies address integration this systematically.
“The intense pressure today’s executives face is even worse for a new leader whose every move is scrutinized, and whose ability to drive near-term change is harshly judged by internal and external critics,” said Ms. Triantogiannis. “The success we’ve experienced implementing this model shows we can reduce the amount of time to reach full performance by an average of 40 percent. This extra time is crucial for new leaders, who will be able to make and implement critical decisions faster, and quickly gain stakeholder support.”
Contributed by Scott A. Scanlon, Editor-in-Chief, Hunt Scanlon Media