Innovation : In Search of the New Age CEO
Dora Vell is a Partner of Heidrick & Struggles’ International Technology Practice based in the Boston office. She is an active member of the Software, IT Services, CIO and Telecommunications Practices. Her search work to date includes EDS, Saba Software, Xign, XTRA Lease, Research In Motion, INEA Software, Certicom, Indigo Books, Music&Café Online, ALUMA-Systems, SmithKline Beecham, Canoe, The Bank of Montreal, The Independent Order of Foresters, PIXStream, Trillium Photonics, Cybermation, Citadel Investment Group, Interactive Media Group, Xign, RDM, Intelligent Digital (Idapta), PlateSpin, Procure.com (now Cyberplex) and others.
As technology continues to transform the nature of doing business in the 21st century, leadership assumes an ever larger and more critical role in the mobilizing of human and other resources around an organization, a product, a competitive challenge.
The notion of leadership has evolved from a primitive paradigm; in the pre-industrial phase of Western civilization, the leader was generally that individual acknowledged to possess the greatest physical strength. In the Industrial Age, brain power became the sine qua non of corporate dominance – leadership by the smartest, at least in theory. And today, in this new era of global connectivity, the race belongs to those relatively rare executives whose passion and empathy, combined with high intelligence and specific skill sets, enable them to inspire others in concerted and productive endeavors that create profitability and market dominance on a global scale.
The gap between demand and supply of such rare beings keeps getting larger as the Baby Boom generation, the most populous in memory, approaches retirement age and is succeeded by generations that are far lower in number. This phenomenon has been aptly termed by McKinsey & Co. as the “war for talent.”
In such a world, it is more and more difficult for a company to go after, win and keep a leader of the highest order. But the first task the firm in search of a New Age CEO faces is pin-pointing the qualities that comprise one.
As an executive recruiter, I work in the combat zone where the war is waged on a daily basis. In my experience, the most successful CEO searches have three distinct phases: defining the qualities needed for successful leadership; recruiting qualified candidates, and, very importantly although often overlooked, ensuring an appropriate cultural fit in order to retain this sought-after individual and promote a successful relationship from the outset.
Much emphasis is placed on the recruiting phase of the process, but organizations sometimes overlook or under-emphasize the initial phase – identifying the precise formula that will constitute a strong predictor for success – and the final and most important step, building a support system around the new leader through the organization’s culture.
Countries, like organizations, have distinctive cultures that weigh in as strong factors in the search for top executive talent. From my base in Toronto, I encounter potential candidates from around the globe. But the Canadian business mindset reflects the operating environment for the majority of my clients, and it is different from others, particularly in the area of organizational culture.
While many if not most workplace trends originate in the United States and eventually migrate northward, Canada has been slower to adopt the high rate of executive turnover that now is the norm in the North American marketplace. There is a much stronger sense of organizational loyalty among Canadian executives, making it more difficult to recruit a CEO but, in the long run, more likely that he or she will, once convinced to make a move, remain with the company.
In general, this sense of loyalty also strengthens the culture of the organization, which means both that the successful CEO recruit must be a good cultural fit, and that retention overall is greatly facilitated in the typical Canadian company.
Creating the Paradigm
Some have termed this process “Emotional Quotient,” or “EQ.” I prefer to think of it as “Social Quotient” or “SQ which is a broader view of the needed attributes encompassing personal discipline and values as well as an empathetic sensibility that is capable of bridging opposing perspectives in pursuit of consensus and forward direction. This set of qualities allows a CEO to move quickly and successfully in a complex, many-layered and very fast-paced environment.
We have long known that intelligence is an essential component of leadership; but, more so now than ever before, IQ is merely the price of admission into senior management. What sets executives apart and takes them to the next level is SQ.
Of course, it is much more difficult to predict for or assess SQ than the more traditional qualities of leadership. In assisting my clients during this initial phase of definition, I interview them extensively about their needs and expectations to pinpoint the kinds of criteria that will add up to a successful candidate. I also speak to many members of the organization to get a feel of the culture and understand the dynamics of the team. Using our proprietary databases and extensive behavioral interviews I seek out and assess executives who fit the criteria. In the interviews, I look for a number of qualities, including candor, self-awareness and the ability to admit failure – all hallmarks of a high SQ.” Also, during the process, extensive reference checking is used to validate the behaviour of the individual at all levels.
Landing the Big Kahuna
Apart from the traditional attributes, culture fit in my experience is the most important factor in hiring decisions. I would select someone with 80 percent of the skills and a great culture fit rather than the other way around, as getting along and connecting with the culture is the number one predictor for success.
Once the ideal candidate has been identified, the hook must be baited. While cash compensation is essential, the factors that move people to make such an important job change are quite different. Leaders who possess a strong component of social skills are drawn by the opportunity to make a difference. Most great leaders are hungry for the next challenge to inspire, to pull the best from the team, to push the ball into the next territory. To recruit such a person, the company must be able to demonstrate that opportunity.
Some of the factors that such candidates consider very closely are the market opportunity, the management team, financing and financial valuation, the competition, the technology, and the fit with the organizational culture.
Accommodating the Opportunity
Once the offer has been accepted comes the most critical phase of the process: blending the new recruit and his or her teams. If the skillsets and competencies have been laid out thoughtfully, and the recruiting process has correctly identified the optimal candidate, a lot of the work to ensure the retention and successful performance of the new CEO has already been done. Engaging the executive immediately in the business as well as personally during the transition process from one company to another is essential as a next step.>
People like to be on a winning team and work with people they like. A charismatic leader who inspires by personal example is the most important element in a winning endeavor. Most important of all, in this pluralistic and diverse business world, the New Age CEO is the one who can develop consensus from a variety of viewpoints and communicate effectively across cultures, industries and politics to move an organization continuously forward, enhancing shareholder value and market position.
© Copyright 2003 by Dora Vell All rights reserved