From the Egon Zehnder International News Service:
Too many companies are recruiting mediocre candidates for senior positions, writes Claudio Fernández-Aráoz in the MIT Sloan Management Review. According to the author, a partner at Egon Zehnder International, top candidates for C-level positions are rare. Assessment errors, the changing skills required in senior positions and the difficulty of measuring such soft skills reduces firms’ chances of success even further. Fernández-Aráoz and his colleagues have devised a set of best practices to help companies avoid these pitfalls:
- Draw up a detailed definition of the skills required before beginning a search
- Cast a wide net to boost chances of finding outstanding individuals
Use a consistent benchmarking process to evaluate all candidates
- Evaluate thoroughly, including behavioral based interviews and in-depth reference checks
- Do good groundwork to filter out biased or false views within the hiring team
- Keep the hiring team small to save resources and eliminate false negatives
- Support the candidate selected during his/her first few months on the job.
The expense of conducting such a thorough search needs to be offset against the lost opportunity costs of appointing a mediocre player to head a company, warns the author. In some markets the leader effect on performance can be as high as 40%, demonstrating the power of strong people decisions at the top, concludes Fernández-Aráoz.
For full story: Claudio Fernández-Aráoz: "Getting the Right People at the Top" in MITSloan Management Review (Number 3, 2005). Article can be purchased online.