August 4, 2016 – Executive search firm Russell Reynolds Associates and Hogan Assessments, a global provider of personality assessment and leadership development, have formed a partnership designed to increase the success rate of executive appointments and accelerate the development of rising leaders.
The alliance combines Russell Reynolds’ depth of expertise in advising senior executives and boards on executive search and succession planning with Hogan’s suite of assessment instruments, data assets and scientific acumen.
The firms will work together on a range of initiatives designed to drive C-suite performance, with an initial emphasis on creating a new, co-branded assessment approach designed to predict executive performance in C-level roles.
A Move to Accelerate Innovation
“The cost of betting on the wrong leader has never been higher,” said Clarke Murphy, chief executive officer of Russell Reynolds Associates. “That said, innovation in the executive assessment space has not kept pace with the rate of change confronting senior executives. We are excited to partner with Hogan to accelerate innovation and deploy new assessments that dramatically increase the success rates of executive selection and succession decisions.”
Mr. Murphy said the initial stage of working with Hogan will be “sharply focused” on the creation of an assessment approach that is purpose-built to predict success (both short- and long-term) in senior executive roles. “For decision-makers, ‘increasing predictability’ really means ‘reducing risk,'” he said. “The risk associated with executive selection and hiring has always been high. But, as executive roles have become more complex, the risk of making the wrong hiring decision has increased meaningfully.”
Expanding Client Demand
In the case of Russell Reynolds Associates, increased and expanding client demand changed how it now conducts assessments during a search.
“CEOs, boards, general managers, and CHROs are no longer content with Rolodex-based search strategies or vanilla search services that ignore the full executive talent lifecycle,” said Mr. Murphy. “Clients expect their search partners to offer thoughtful, consultative guidance and deep insight – from defining a role, to selecting a successful candidate, to planning for succession, driving business transformation through talent, and rebalancing culture.” And, he said, they expect that insight to be supported by verifiable data and more empirical evidence. “If you’re trying to compete on superior access to basic information, you’re going to lose every time. To win, you need to bring real insight to the table.”
It’s All About Precision Hiring
The assessments will enable executive teams and boards to increase the precision of selection decisions and mitigate the risks associated with senior executive appointments.
“No other factor plays a bigger role in determining the fate of organizations than the quality of their leaders, so understanding and measuring potential for leadership is the utmost priority for winning the war for talent,” said Tomas Chamorro-Premuzic, CEO of Hogan Assessments. “Our partnership with Russell Reynolds will allow us to combine robust data on millions of leaders around the world to create the best tools and solutions in the market. We are excited to join forces with a true leader in the field.”
“The growth of corporate in-house recruiting – and other countering pressures from outside sources – presents a new challenge for search firms now competing against a one-stop-shopping approach,” said Scott A. Scanlon, founding chairman and CEO of Hunt Scanlon Media in Greenwich, Conn. “It has forced their hand — but on the bright side, search firms have re-evaluated their service model and are re-inventing it to keep pace with client and candidate expectations.” Testing and predicting future success at the executive level is the holy grail of executive search at the moment, he added.
Spencer Stuart, a global executive search and consulting firm and a direct rival to Russell Reynolds Associates, concluded in a recent report that a seamless succession process is desirable but is not in itself a measure of success. As a result, boards can easily focus on the process to the detriment of its principal purpose, which is to secure the very best available candidate. As chief executives’ stature has grown in power and influence over the past two to three decades, so, too, is the ability to predict their level of success.
“It’s no longer good enough to trust your gut when making a hiring decision for a C-level role,” Mr. Murphy said. “The stakes are too high, and the risk of failure is too great. We believe that the rigor of executive selection, hiring, and development decisions should match the rigor applied to financial and operational decisions.”
Hunt Scanlon Media recently reported on other search firms offering more than just traditional recruiting services. Here’s a closer look at just a few of them and what they offer:
- With the acquisition of OCE Consulting, Alder Koten recently expanded into the management consulting space. OCE Consulting focuses on helping clients achieve successful deployment of their business strategies through culture deployment and the effective application of change management techniques. The firm’s list of clients includes a wide array of companies in different industries and regions of the world – including industrial conglomerates, manufacturers, energy companies, and financial institutions;
- Executive search firm The Overture Group launched a compensation consulting practice and added Mark Reilly to lead it as managing director. He has expertise in compensation, including short term and long term incentive compensation plan design, expert testimony, and performance measurement to a wide range of companies from start-ups to the Fortune 500;
- Eg.1 opened a new office in New York City earlier this year to support its continued growth in the U.S. The firm’s expanded team and new office will enable it to provide improved business intelligence and local, on-the-ground executive search support services to its clients;
- Ryan Search & Consulting formed a partnership with the Center for Creative Leadership (CCL) a few months ago to provide clients with a deeper array of leadership development resources. A global provider of leadership development, CCL works with individuals, teams, organizations and companies to help them achieve their objectives through leadership development & organizational guidance, coaching, change leadership, culture transformation and succession planning. For over 40 years, the firm has worked with more than one million leaders at all levels in more than 130 countries worldwide;
- In February, Heidrick & Struggles acquired Decision Strategies International (DSI), a Philadelphia-based strategy and leadership advisory firm. Founded in 1990 by Paul Schoemaker, DSI has advised some of the world’s best-known organizations; it specializes in strategic planning and decision making in uncertain operating environments, leadership development, and talent strategy. This acquisition comes on the heels of Heidrick’s acquisition of Co Company, a London-based advisory boutique specializing in leadership services that accelerate organizational performance. Both firms have now been merged into Heidrick’s leadership consulting business;
- Executive search firm Conroy Ross recently partnered with Optimum Talent, a privately owned integrated talent management firm. Together, they provide clients with a full offering of leadership solutions including executive search, leadership development, coaching, organizational psychology and career transition;
- And of course late last year Korn Ferry finalized its acquisition of Hay Group for $452 million. Hay Group now includes Korn Ferry’s former Leadership and Talent Consulting segment. Hay Group, founded 72 years ago, is a global leader in people strategy and organizational performance and is sure to give Korn Ferry the heft it was seeking to service clients well beyond its executive search core offering.
Contributed by John Harris, Correspondent, and Dale M. Zupsansky, Managing Editor, Hunt Scanlon Media