5 Risks in leadership recruitment and how to mitigate them: Insights from Thomas’ research

When you recruit leaders, the stakes are high. Hiring the right leader can take your business to new heights, whilst hiring the wrong one can do devastating damage. Leaders set the tone for your organisational culture, and their behaviours shape both the form and the content of business operations. Competition for talent is also more intense at the top, so efficient recruitment processes and exemplary candidate experiences are crucial.

Nosediving shareholder value, reputational damage and employee disenchantment are all potential risks when you hire leaders. With the highest levels of competition for top talent on record in many countries globally, there is pressure on recruitment professionals and processes to deliver exceptional candidate experiences. So that you can land the right leaders, here are five major risks in leadership recruitment and how to mitigate them.

• Lack of candidates

At higher levels of leadership, the talent pool can be small. Senior professionals with the right sector experience are often scarce, and incentivising them to jump ship is costly - external hires cost around 20% more on average (Krell). Add to that the global skills shortage, worsened by the pandemic, and companies are struggling to fill leadership roles.

Although not feasible in all circumstances, resourcing senior roles from within is not only more cost-effective than hiring externally, but saves time, as external talent is likely to take longer to learn the industry, business and requirements of their new role.

How can you overcome the labour shortage?

At a time of acute skills shortage, you want to know which of your candidates have the potential to onboard successfully, learn the required skills quickly, and steer your organisation to greater heights. An aptitude assessment is a reliable and objective way to filter for applicants who have the right mindset to take a leading role in your organisation. Personality assessments can also help to identify employees with leadership potential, enabling you to develop robust talent pipelines and respond to market demands with agility.

• Poor Team Fit

Sometimes out of necessity, firms must look outside the business for the right kind of leadership experience, fresh perspectives and skillsets. Yet the new ideas that an external senior hire brings to the table may create friction within the existing leadership team. Innovation always entails a level of risk, and these ideas may be naïvely formed if the new recruit is unfamiliar with the sector or business. A new leader’s success can also be impeded by a lack of established relationships with other members of the senior management team.

How can you ensure team fit?

Measuring the emotional intelligence (EI) of prospective candidates for leadership can give you an indication of their level of self-awareness and likely contribution to a team. Emotional Intelligence expert Daniel Goleman divides emotional intelligence into four distinct but complementary components; Self-Awareness (recognition of one’s own emotions), Social Awareness and Empathy (recognition of others’ emotions), Self-Management (ability to manage one’s own emotions) and finally Social Skills (the ability to influence and manage others’ emotions).

An emotional intelligence assessment can also be a useful starting point for future leaders looking to evolve their EI and step up into managerial positions. Research shows that behaviour-based training significantly improves team coordination and performance (McEwan, 2017).

• Low Diversity

With diversity in senior leadership teams strongly linked with outperformance (McKinsey), and a top concern for frontier brands in most sectors, your business can’t afford to fall into nepotism. Traditional definitions of leadership can exclude qualified leaders. Whilst the stereotypical leader exhibits high levels of dominance, the benefits of other leadership styles are increasingly being recognised by businesses. Diverse teams have been shown to be more innovative and successful than homogenous ones (HBR).

Yet diversity can also be challenging. In some cases, it has been shown to weaken collaboration (Forbes) and lead to distrust and resentment within teams (Galinsky). To build successful diverse leadership teams and organisations, recruitment professionals, therefore, need to hire emotionally intelligent leaders capable of managing differences effectively.

How can you appoint diverse leaders?

When hiring for senior positions, it’s important to measure what matters. Removing identifiable information from CVs can also help to ensure individuals from diverse groups aren’t excluded during the screening stage. Developing profiles for leadership roles that include personality and behavioural traits as well as competencies will provide objective and measurable criteria to inform hiring decisions. Assessing candidates’ aptitude (speed of learning) can predict in-role performance, revealing how quickly an individual processes information.

This assessment can also help to identify individuals with the potential to step up into leadership positions, creating opportunities for a more diverse pool of candidates.

• Poor Agility

Demographics, technological advancement, market uncertainty: we need people who can lead us through inevitable - yet disruptive - changes. The pace and complexity of these changes can make it difficult to plan ahead. What is clear is that we need leaders who are capable of capitalising on high levels of uncertainty, whether that be through change management, innovation or partnership building. In today’s environment, leaders often need to react as quickly as possible, rather than putting off difficult tasks and decisions

Agile leaders confront problems, take calculated risks, and have difficult conversations. Studies by Fredrickson (2001), Hannah et al. (2007) and Norton & Weiss (2009) have shown that fear restricts an individual’s range of potential responses to a perceived threat. This often results in avoidance, which is why professional success today requires courage in addition to sector knowledge, business acumen and relevant experience

How can you identify and recruit agile leaders?

Hiring for fluid intelligence rather than CVs and past accolades alone also puts your organisation in a strong position to secure courageous, agile leaders. An aptitude or General Intelligence Assessment (as distinguished from an Intelligence Quotient test (IQ)), helps to identify individuals who process information quickly. These fast learners will be equipped to spot trends in data, respond to market changes in an agile way, and innovate to continuously improve your organisation. Aptitude assessments can also provide an indication of a candidate’s potential to succeed in a pressurised, high-risk environment.

Workplace Personality assessments reveal how motivated a candidate is by novelty, their appetite for innovation and comfortability with change. Personality assessments also provide insight into candidates’ typical approach to risk and uncertainty.

• Misalignment with values

Poor alignment with company values negatively impacts organisational culture and could cause reputational damage and investor confidence. PricewaterhouseCooper's global study of over 2,500 CEOs of major corporations found that nearly one in five forced turnovers is due to ethical lapses. Even in less dramatic circumstances, though, it’s important that your leaders model your values so that they are disseminated and lived within the organisation. Successful leaders find a balanced approach to risk, incurring just enough to motivate their teams and spark innovation whilst avoiding chaos and confusion.

How can you ensure that your leaders live your values?

Whilst Behavioural assessments reveal candidates’ typical responses to workplace demands, a Workplace Personality Assessment will provide insight into their innate personality preferences. The assessment can shed light on leadership candidates’ underlying motivations and how they are likely to express these at work. As such, it can be extremely useful to map your values against the spectrum of personality traits and behaviour styles at the outset of recruitment to help you assess candidates’ natural alignment with your organisation’s values.

Since leaders are naturally motivated to improve performance, regular ‘360-degree’ feedback sessions can help to foster a culture of learning and continual improvement that will help to nurture your leadership talent pipeline.

This article is part of a content partnership with Thomas International. You can learn more about psychometric assessments and to see how Thomas can help your organisation hire better, contact an expert here: Contact us | Thomas.co