Organisational Change Management Volume 2

Succession Planning

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Introduction

. Worldwide the status of succession planning is

"...16 % of CEOs want to be carried out in a coffin; 30 % of senior executives do not plan for succession; great companies are 6 times more likely to have a successor in place. They hold their leaders accountable for developing the direct reports. In higher performing companies at least 10 % or more incentive is based on leadership development. The final test of the leader is how well his or her successor does!..."

Manfred Kets de Vries, 2006

. The most common attitude to succession planning can be expressed as

"...Succession ‐ power sharing, the delicate balance of egos and wills that it entails ‐ is the thorniest, most dreaded, and least talked-about rite of passage..."

Betsy Morris, 2007

Most bosses find it hard to give up the "clarity of control"and the incredible pull of being needed all the time. On the other hand, succession planning can make or break an organisation.

. There is an alarming lack of succession planning in Australian organizations. A survey in 2002 found

"...49% of Australian companies hadn't begun to think about succession planning..."

AFR, 2002

Yet it is expected that around 40% of senior managers in Australia will retire over the next 5 -10 years. This, combined with flatter management structures in organizations, means that the next group of senior managers is less experienced than the generation it is replacing ‐ sometimes by 10 or more years

. Importance of succession planning

"...the ultimate statement, the acid test of a great leader, is how their successor goes..."

Manfred Kets De Vries as quoted by Andrew Cornell, 2008b

- sometimes a new senior executive and/or more general change in staff is needed to signal the need for change and the types of change characteristics and attitudes required

- next generation of top management personifies the new approach, ie promotion is based on the effectiveness of the change

. A USA study (1988) found

"...companies with formal succession planning systems in place exceeded the expected performance of their peer companies by 16%, while those without under-performed by 7%..."

Andrew Cornell, 2003

A more recent study supports this, ie

"...less than 15% of companies that had a structure for developing leaders and putting them in the right jobs averaged shareholder returns of more than 10% above their cost of capital over 10 years. Those with little emphasis on the succession averaged less than 1% return..."

Andrew Cornell, 2003

. Succession planning involves helping employees with a career path and developing the skills they need to grow into new roles. Such company-wide programs ensure that when people move up into the ranks, the next set of managers will be there to replace them. This involves organising, informing and nurturing talent

. It is important to hold individual executives accountable for developing their replacements. This helps ensure an orderly transition and provides some assistance in the keeping of talented staff. Generally, organizations find it difficult to locate suitable outside talent to fill positions in an organization.

 Chris Moody in Harvard Business Updates, 2001

. Unfortunately, succession training on the individual level is often ineffective because managers do not develop a well-considered plan and do not devote enough time to carry it out.

. Succession planning involves screening candidates, usually by interviewing. To help select the right people, use behavioural questions with a sound structure (such as basing questions on an analysis of what the job requires and asking all candidates the same questions). Behavioural questions includes asking how the candidates have behaved in past situations that are relevant to the position. This is based on the notion that past behaviour is a good guide to future behaviour. For example, if the position requires persuasion, then a behavioral question might ask the candidate to describe what they did when they were required to persuade somebody to change their opinion or agree to do something. The aim is to uncover what candidates did previously in this kind of situation and the level of skill that they would apply.

. Similar to behavioural questioning is situational questioning which is used when interviewing people who have little experience relevant to the job. This involves asking candidates to indicate how they would handle situations similar to those required by the job.

. Very few senior managers have a HR background, ie only 3% of CEO (Fiona Smith, 2012b). Most CEO have a technical (engineering) and/or accountancy background which stresses facts, figures and their behaviours and mentality focus on competition, ie competing to win plus language of business school and military symbolism, etc. Conversely, the HR fraternity comes from the social sciences background; usually females who are encouraged not to compete but to help and co-operate. Furthermore, traditionally HR has looked after industrial relations (IR) which normally means handling and negotiating against the unions. So HR can have conflicting roles, ie acting as a confident, coach, counselor, mentor, etc to staff, and as the bosses' representative in IR-related staff issues including pay and conditions. Increasingly, HR needs to understand the business

Core Tasks for Succession Planning

. James Hall (2004e) outlines the core tasks to ease the transition in succession planning:

- diagnose the situation (provide a framework that helps leaders discern which type of transition situations they are entering in order to identify the most critical skills and strategies to be applied in their own transition)

- assess your situation and yourself (helps leaders identify potential strengths to leverage as well as vulnerabilities that could significantly impact the transition)

- accelerate your learning (provides leaders with insight into what and how to learn, in order to improve their performance)

- prioritise to succeed (helps leaders to identify early wins and establish priorities to ensure success)

- build your team (focuses leaders, who are inheriting or building a team, on initial steps to take to generate team momentum)

- create partnerships (helps leaders analyse the complex space in which they must learn, work and achieve results)

(NB Once succession planning is in place, the incumbent must be prepared to "let go of the reins"sooner rather than later. On the other hand, the anointed successor needs to give

"...due respect to the person currently in the chair. At the same time, prepare yourself for the challenges that are ahead by garnering all the stakeholders' views in a very quiet way..."

Mark Mcinnes quoted by Sue Mitchell, 2006

In summary, succession planning can be described as

"...I've run my leg as fast as I can. The challenge now is to hand the baton to someone fitter, faster and fresher who will run the next leg..."

Andrew Mohl as quoted by Narelle Hooper, 2007c

Criteria for Selecting the Best Talent (4 different sets)

"...strategies, products, even patents - these can be copied. Talent can't be..."

John Stewart as quoted by Andrew Cornell, 2008

. The difference in productivity and profitability between an average and a top performer is significant (Fiona Smith, 2009r). Some examples,

- in simple jobs such as adjusting bolts on an assembly line, there is a 40% difference in productivity between an average and top worker;

- for an insurance salesperson, the difference is 240%;

- for knowledge workers, such as computer programming, account managers in professional services, accountancy, law, consulting firms, etc the difference is 1,400%.

1. One Set of Criteria

According to Jack Welch (2005), the following criteria need to be considered when selecting people for a position:

. Acid test

- integrity (people with integrity tell the truth and keep their word)

- intellectual curiosity (don't confuse education with intelligence)

- maturity (can withstand the heat, handle stress and setbacks; enjoy the successes with humility. Furthermore, mature people respect the emotions of others; they feel confident but not arrogant; they have a good sense of humour, especially about themselves)

(as there are no good tests for these 3, need to rely on reference checks, reputation and intuition)

. 4 Es and 1 P

- possess positive energy

- ability to energize others

- have the edge, ie the courage to make tough decisions, especially with incomplete information

- able to execute, ie the ability to get the job done

- have passion for the job and life in general

. Others

- possess authenticity (self-confidence and conviction with a realness)

- ability to see around corners (have a special capacity, ie 6th sense, to anticipate the radically unexpected, or the ability to imagine the un-imaginable)

- able to surround themselves with people who are better and smarter than themselves

- resilience (need to learn from mistakes and be able to bounce back)

2. Another Set of Criteria

"...in an increasingly complex world where we have no idea what will be thrown at us, the best buffer against uncertainty is to be certain of the people around you and figure it out together as you go along..."

Jim Collins as quoted by Rose-Anne Manns, 2007

. According to Jim Collins (2007), there are 6 characteristics for selecting the appropriate people

i) they must fit with your core values - you need to identify people who share your values rather than trying to change them

ii) they are self-managed - they do not need to be tightly supervised but could need guiding, coaching, mentoring, etc

iii) they realise that they have responsibilities - not just a job

iv) they keep their word - "walk the talk"

v) they accept responsibility for their actions and mistakes

vi) they have a passion for the organisation's cause or work

. The real question is

"...who am I going to take the journey with?..."

Jim Collins as quoted by Rose-Anne Manns, 2007

3. A Third Set of Criteria

Criteria for selection of staff
- integrity (most important as you need to build an organisation around trust, ie you do what and when you say you're going to do)

- intelligence (IQ, EQ & SQ)

- energy

- resilience (as things go wrong unpredictably, you need a high tolerance for bad news)

- team players (do they work well with others)

- communication ability

- resourceful

- handle justified criticism

4. A Fourth Set of Criteria

. In looking to the future, Howard Gardner posed the following question

"...What kind of mind do we need if we are to create a world in which we would like to live?..."

Howard Gardner, 2006a

His answer is 5 kinds of minds; the first 3 (disciplinary, synthesizing and creative) deal primarily with cognitive forms and the last 2 (respectful and ethical) comprise our relations with other people, with ethical being more abstract.

NB All education efforts (family, school, community, etc) are

"...dedicated toward the acquisition of the appropriate disciplinary knowledge, habits of mind, and patterns of behaviour.....the goal is......to eradicate erroneous or unproductive ways of thinking..."

Howard Gardner, 2006a

i) a disciplinary mind exhibits these qualities:

- studying ways of thinking and mastering a major school of thought or scholarly discipline, such as science, mathematics, history, etc .

- the mastery of basic skills of disciplinary thinking is necessary but not a sufficient prerequisite, ie

"...knowledge of facts is a useful ornament but a fundamentally different undertaking and thinking is a discipline..."

Howard Gardner, 2006a

This is more than accumulating a mass of facts and figures, even though facts and figures are needed. It involves a way of thinking. This highlights the difference between subject matter and discipline: in the area of subject matter, large number of facts, formulas and figures have been committed to memory; discipline represents a distinctive way of thinking about the world, eg one does not confuse correlation (A occurs before B) with causation (A caused B); is aware that current consensus is subject to challenge based on evidence, etc). Factual statements only gain meaning by being placed in context.

- understanding at least one major professional craft/trade or code of practice, such as law, medicine, management, finance, architecture, etc so that one has mastered the body of knowledge and key procedures relevant to that profession

- capable of applying oneself diligently and passionately so that improvement occurs steadily as part of lifelong learning (including action learning); this starts before adolescence so that continuing mastery of one's profession or employment role(s) occurs, including acquisition of additional disciplinary or interdisciplinary acumen. Remember: achievement should encourage a 'thirst"for more knowledge

- training in the disciplinary thinking will take place through identification of mutual interest and talents; modelling of ways of thinking; successful completion of certain signature assignments; the provision of timely, useful feedback

How to achieve a discipline mind:

- identify the important topics or concepts within a discipline including methodology, such as being unable to prepare and understand a balance sheet

- spend a significant amount of time studying the topic

- investigate the topic from many directions or approaches to re-enforce learning and understanding

- provide opportunities to perform the understanding under different conditions, situations, etc (including feedback on performance)

"...the only reliable way to determine whether understanding has truly been achieved is to pose a new question or puzzle - one on which individuals could not have been coached - and see how they fare..."

Howard Gardner, 2006a

Furthermore,

"...scholarly disciplines allow you to participate knowledgeably in the world; professional disciplines allow you to thrive at the workplace..."

Howard Gardner, 2006a

NB Without mastering at least one discipline, an individual is less likely to be in control of his/her destiny.

Some mastery of science and technology is required to understand controversial issues, such as nuclear power plants, genetically modified foods, global warming, etc. On the other hand, science and technology do not have a built-in value system

Need to be careful of

"...asserting of mastery without a decade or so of practice; following rigidly the letter of procedures without a sense of the purpose and boundaries of the discipline and the areas where thinking needs to be flexible as the conventional wisdom is inappropriate; faking one's preparation or performance..."

Howard Gardner, 2006a

Furthermore, need to be careful of a discipline going awry, such as undue excessive domination or pursued obsessively and compulsively for its own sake. Need to be aware of the limitations of a discipline, ie when to draw on them, when to temper or shelve them.

ii) a synthesizing mind readily performs these functions:

- selecting crucial information from the copious amounts available

"...The amount of accumulated knowledge is reportedly doubling every two to three years..."

Howard Gardner, 2006a

- the ability to integrate ideas from different disciplines or spheres into a coherent whole and to communicate that integration to others

- recognizing new information/skills that are important and then incorporating them into one's knowledge base and into one's professional repertoire

- ideally this starts in childhood, becomes more deliberate over the time and continues as new knowledge accumulates and needs to be digested and organised

Types of synthesis include

- narratives (usually the most popular and involves putting material together in a coherent story, such as in novels)

- powerful metaphors, images and themes ( a popular one that involves concepts brought to life by invoking metaphors; metaphors can be represented verbally and graphically, such as when corporations create brands in words, graphics, jingles, etc)

- taxonomies (materials are ordered in terms of salient characteristics, such as classifications)

- complex concepts (newly stipulated concepts can tie together or blend a range of phenomenon, such as Charles Darwin's concept of natural selection)

- rules and aphorisms (much folk wisdom is captured and conveyed by short phrases that are designed to be memorable and widely applicable, such as 'think globally, act locally')

- embodiments without words (powerful messages can be conveyed in works of art, such as paintings, sculptures, song and/or dance, etc)

- theories (concepts can be formulated into theories, such as Darwin's Theory of Evolution combines the concepts of variation, competition, natural selection, and survival until reproduction)

- meta-theory (establishing an overall framework of knowledge: an example is how Karl Marx viewed social/economic/material factors as determinants, with ideas emerging as a superstructure)

NB Sometimes a combination, such as a narrative which includes aphorisms, concepts and taxonomies, may be used

Components of synthesis

- an objective (what is trying to be achieved)

- starting point (an idea, image, building on previous work, etc)

- selection of strategy, method and approach (narratives, taxonomies, complex concepts, rules, etc)

- drafts and feedback

Linking the kinds of synthesis with the various forms of intelligence, eg

- a linguistic mind would favour a story

- a logical mind would be interested in some kind of equation or theory

- a spatial mind would flavour a chart, drawing, diagram, etc

- bodily-kinaesthetic mind would favour some kind of balance between opposing forces, etc

Interdisciplinary synthesis poses additional concerns. There is no guarantee that combinations of disciplines will be appropriate or productively linked, especially with different terminology between the disciplines making communications hard. This type of synthesis is used to come up with 1 of 3 considerations:

i) a powerful new concept has been developed and needs to be tested in new fields, such as the idea of inexpensive disruptive technologies, such as the Internet, that will help newcomers while threatening to displace the more traditional players in an industry

ii) an important phenomenon emerges and needs to be contextualized, such as a new "wonder"drug that has toxic side effects that will impact on a small group of people

iii) a pressing problem emerges and the current disciplines cannot handle it, such as AIDS where the combined disciplines of virology, demographics, immunology, behavioural psychology and social network theory are needed

Synthesis is becoming increasingly important now that "data overload"prevails

"...the manager must consider the job to be done, the various workers on hand, their current assignments and skills, and how best to execute the current priority and move on to the next one. A good manager also looks back over what has been done in the past months and tries to anticipate how best to carry out future missions......begins to develop new visions, communicates them to associates, and contemplates how to realize these innovations......invades the realm of strategic leadership and creativity within the business profession......synthesizing the current state of knowledge, incorporating new findings, and delineating new dilemmas is part and parcel of the work of any professional..."

Howard Gardner, 2006a

Need to be aware of the changing technology and its impact on the synthesizing mind. For example, before the invention of the printing press, when books were scarce, it was vital for individuals to have good verbal memories; once books became readily available, memory was less important; more recently, the Internet has extended this. On the other hand, this has heightened the significance of the synthesizing mind which needs to handle huge bodies of information in print and electronic forms. Furthermore, globalization has increased interdependence and the need for better personal relationships and understanding of different communities

Need to be careful of

"...Selecting material in a haphazard way; offering integrations that do not stand up to scrutiny, neither by self or by knowledgeable others; inappropriate organizing frameworks; lack of organizing stance; summaries that feature overly grandiose "lumping"or "nitpicking"or "splitting"..."

Howard Gardner, 2006a

Lumping refers to seeing connections so able to join theories, stories, examples, etc together; to accentuate their commonalities; to pinpoint their order in yet a greater order. By contrast, splitting refers to making distinctions, enjoying contrasts, always asking Why do these not connect? What is a difference, what is a crucial distinction?

Furthermore, we need to be careful of the trend towards specialization in disciplines. Alternatives include multidisciplinary or multi-perspective within-one discipline approaches, plus encouraging "big picture"understanding, ie

"...to look beyond their own backyard and specialization; to understand the various components in the organisation or constituency; to think systematically about what is working, what is not working, and how goals can be more effectively achieved. Programs that enhance their synthesizing capacities - and evoke synthesizing and strategizing - would be valuable..."

Howard Gardner, 2006a

iii) a creative mind involves

- breaking new ground

- has a capacity to put forth new ideas, poses unfamiliar questions, conjures up fresh ways of thinking

- uncovers and clarifies new problems, questions and phenomena with unexpected answers

- goes beyond existing knowledge and syntheses to pose new questions, offer new solutions, fashion works that challenge existing genre or configure new ones

- builds on one or more established disciplines and requires an informed field to make judgments of quality and acceptability

- thinking outside the box - putting forth recommendations for new practices and products, explicating them, seeking endorsement and enactment

- for a leader, this means formulating and issuing new visions

NB Informed challenges to orthodoxy require at least partial mastery of discipline and synthesizing thinking. In fact,

"...aspiring creator needs a generous supply of intelligence(s), skill and discipline...... a baseline of literacy and discipline..."

Howard Gardner, 2006a

The main differences between synthesizing and creating minds are

"... the synthesizer's goal is to place what has already known into the best, useful and illuminating a form as possible. The creator's goal......is to extend knowledge, to ruffle the contours of a genre, to guide a set of practices along new and hitherto unanticipated directions. The synthesizer seeks order, equilibrium, closure: the creator is motivated by uncertainty, surprise, continual challenge, and disequilibrium..."

Howard Gardner, 2006a

Generally we look to leaders rather than managers for inspiration and examples of creativity

Throughout history, creativity has had a tough time

"...just as human beings have a conservative bent, one that militates against educational innovation and interdisciplinary leaps, human society also strives to maintain the current form..."

Howard Gardner, 2006a

Need to be careful of

"...Offering apparent innovations that are either superficial variations of long-existing knowledge or sharp departures that may be novel but are not accepted ultimately by the knowledgeable field..."

Howard Gardner, 2006a

iv) a respectful mind involves

- welcoming differences and having an understanding, awareness of and appreciation of differences among human beings and human groups.

- in a world where we are all interlinked, intolerance or disrespect is no longer a viable option

- responding sympathetically and constructively to differences among individuals and among groups ‐ ie avoiding as much as possible, thinking in group terms

- seeking to understand others on their own terms

- extending trust to others who are different

- working with those who are different

- extending beyond mere tolerance and political correctness

- it is not about winning "popularity polls"

(NB Ideally this attitude starts at birth, so role models are important, especially parents; involves being humble)

"...no doubt human beings have deeply entrenched inclinations to delineate groups, to identify with and value members of their own group, and to adopt a cautious if not antagonistic tone to other comparable groups, however defined and constituted. But such biologically accented explanations have limitations......they do not account for the contours, breadth, or flexibility of such ingroup-outgroup distinctions......we......must somehow learn how to inhabit neighbouring places - and the same planet- without hating one another, without lusting to injure or kill one another, without acting on xenophobic inclinations even if the group might emerge triumphant in the short-term......human beings to accept the differences, learn to live with them, and value those who belong to other cohorts..."

Howard Gardner, 2006a

Furthermore,

"...respect emerges as time- and situation-specific, rather than as an assumption that governs our human relations......respect should not entail a complete suspension of judgment. When a person consistently acts disrespectfully toward others, that person should be called to account..."

Howard Gardner, 2006a

Need be careful of stereotyping and caricaturing, and

"...exhibiting mere tolerance, without any effort to understand or work smoothly with others; paying homage to those with more power and status while deprecating, dismissing, ridiculing or ignoring those with less power; behaving reflexively toward an entire group, without attending to the qualities of the specific individual..."

Howard Gardner, 2006a

v) an ethical mind involves

- understanding and recognizing your responsibilities as a citizen of a group, community, region, nation and the world, ie striving to serve purposes beyond self-interest

- abstracting critical features of one's role at work and one's role as a world citizen; acting consistently with those conceptualizations

- striving toward good work which is defined as excellent in quality, responsible and accountable, and engaging. Linked with good work are the 4 Ms:

i) mission (what are you trying to achieve? eg goals and objectives);

ii) models (especially individuals who are positive role models);

iii) mirror test - individual version (involves self-reflection to determine if you are doing the right thing; should use an outsider as a reality check);

iv) mirror test - professional responsibility (monitoring what your peers are doing and, if required, calling them to account)

NB These should become part of a person's mental architecture (habits of the mind) that involves constant reflection, wide consultation and abstract thought

- good world citizenship

i) knowing and living the core values and principles of one's profession and seeking to maintain them and pass them on, even at times of rapid and unpredictable change

ii) knowing and living the core values (truthfulness, integrity, loyalty, fairness, etc) of one's community/society; even when it means that it goes against your own self-interest, ie commitment to ethics, trust and integrity, ie banking and finance oath
"...Trust is the foundation of my profession, I will serve all interests in good faith, I will compete with honour, I will pursue my ends with ethical restraint, I will help create a sustainable future, I will help create a more just society, I will speak out against wrongdoing and support others who do the same, I will accept responsibility for my actions..."

Joanne Gray, 2015f

iii) with maturity, adopting the role of the trustee, who assumes stewardship of a domain and is willing to speak out, even a personal cost

iv) should start when an individual can think conceptually and abstractly about their role and may require supportive relationships

- counter the "veil of ignorance"

It involves and abstract attitude, ie

"...the capacity to reflect explicitly on the ways in which one does, or does not, fulfil a certain role..."

Howard Gardner, 2006a

It goes beyond partisan religious beliefs; the quality of peer group is important in determining the ethical mind

Educators need to focus on the connotations of goodness, such as quality of life and living ie

"...students need to understand why the learning what they are learning and how this knowledge can be put to constructive uses.....and to bear witness when the understanding (or misunderstanding) is being used in destructive ways. This is the reason why community service and other forms of giving are - or should be - an important part of the curriculum of any school......from an early age......young people are influenced by what they see around them, what is rewarded, what is written about, what is ignored or disparaged..."

Howard Gardner, 2006a

There is considerable overlap between respect and ethics, ie

"...it is difficult to imagine an ethical person who does not respect others..."

Howard Gardner, 2006a

Some questions to help identify the ethical mind

- what does it mean to be a professional at the present time?

- what are my obligations, rights, responsibilities, etc as a person and worker in being a citizen of this community/country/region/world?

- what are my expectations of others based on my understanding of their respective positions and views, especially those who are less fortune than me?

- what kind of world would I like to live in and what is my responsibility to help this happen?

Need to be careful of

"...expanding a good, responsible line but failing to embody that course in one's own actions; practicing ethics in a small arena while acting irresponsibly in the largest sphere (or vice versa)..."

Howard Gardner, 2006a

- some dilemma need to be managed, such as

"...can a praiseworthy end justify dubious means?..."

Howard Gardner, 2006a

- some trends in society mitigate against ethical mind, such as the promise of enormous financial reward for those willing to overlook and embrace dubious activities.

. There are some resistances and obstacles to developing these 5 desirable minds in the future, ie

"...- Conservatism. We are doing perfectly fine with traditional education and long-standing practices at work - why change?

- Faddism. Visionaries and pundits are always calling for something new. Why should we believe that these 5 minds are any better than earlier calls for other forms of mind?

- Hidden risks. Who knows the hidden costs of this regime? Perhaps excessive creativity with slip into anarchy. Perhaps naive or misplaced respectfulness will make us sitting ducks for terrorists

- Impotence. These goals sounded good. But I don't know how to achieve them, and I don't know how to evaluate whether they are actually being realised. Show me want to do, and don't expect me to assent..."

Howard Gardner, 2006a

NB There are other minds that can be considered, such as flexible (can handle the ever-changing environment), technological, digital, democratic, emotional, spiritual, strategic minds, etc

Some examples of the kind of minds include Marie Curie (disciplined mind), Aristotle (synthesizing), Bill Gates (creative), European people who sheltered Jews during World War II (respectful) and Rachel Carson (ethical).

. Individuals without one or more disciplines will not be able to succeed at any demand in the workplace and will be restricted to menial tasks

"...Individuals without synthesizing capabilities will be overwhelmed by information and unable to make judicious decisions about personal or professional matters

Individuals without creating capabilities will be replaced by computers and will drive away those who have the creative spark

Individuals without respect will not be worthy of respect by others......

Individuals without ethics will yield a world devoid of the decent workers and responsible citizens..."

Howard Gardner, 2006a

Retention of talent

It is an important part of succession planning

How to nurture talent
"...1. Retention - rather than putting your faith in poaching competitors, you need to defend the employees you already have. What high-potential employees want is autonomy, mastery and purpose. They don't want to be overmanaged, they want the opportunity to grow and learn, and they want to know their work is making a difference.

2. Potential - assess the potential of senior leaders so that you have an accurate guide to your rising stars

3. Development - develop them through the use of job rotation......senior executives asked what had most help unleash their potential, their answer was stretch assignments and job rotations..."

Claudio Fernandez-Araoz as quoted by Fiona Smith (2015/2016a)

Behaviourial/situational interviewing

. When employing people, it is important to make the right choice; the cost of getting it wrong can be substantial

. Past behaviour is a good predictor of future behaviour, ie if a bully now, most likely will be a bully in later life

. Need to be careful of the "illusion of validity"

"...this means that many managers believe that others might not know how to use an informal interview to select the right candidate......the research evidence shows that informal interviews have very low reliability in selecting candidates most likely to succeed in the job..."

Harry Onsman, 2004d

. Some of the limitations of job selection interviews include

"... - stereotyping of candidates (using very limited information to decide that a candidate is of a certain type)

- primacy effect (remembering the beginning of the interview better than the rest of the interview)

- personality similarity effect (believing people like ourselves are the most competent)

- negative information weighting bias (exaggerating the importance of information that reflects poorly on the candidate)..."

Harry Onsman, 2004d

. Interviews have limitations as they are based on fragmented evidence; the interviewers are generally overconfident in their intuition; put too much weight on their personal, first impressions and too little weight on other sources of information.

. Despite these shortcomings, interviews remain popular for the following reasons

"...- they perform functions other than selection, such as selling the organisation to the candidate, and persuading and negotiating arrangements with the candidate

- they are accepted by managers and candidates as valid because interviewing is......easier to understand than any other more technical technique (such as competency profiling or personality testing)

- they are low in cost compared with other techniques such as tests..."

Harry Onsman, 2004d

. Elements that impact on the content of interviews include

"...- basing questions on the job analysis

- asking each candidate the same questions

- limiting prompting of candidates by interviewer

- using better types of questions, such as behavioral or situational questions

- using more questions

- disallowing questions by candidates..."

Harry Onsman, 2004d

. On the other hand, positive impacts on the evaluation process include

"...- rating each answer on a scale

- using behaviorally-based rating scales

- taking detailed notes

- using multiple interviews

- using multiple interviewers

- using the same interviewer(s) for all candidates

- not discussing candidates between interviews

- providing interviewer training

- limiting unsolicited information provided by candidates

- using a rating system for each question/answer rather than making a broad, overall judgment......the elements that most improved job interview content were the use of job analysis, using the same questions and using better types of questions......behavioral questions can improve the effectiveness of the selection interview by a significant factor..."

Harry Onsman, 2004d

. Generally behavioral questions are more effective than situational questions as an interviewing technique for the following reasons

- flexibility (questions allowed candidates to explain their real-life experiences and behaviours; probing questions can be used to discover additional detail behind the answers provided)

- fairness (allows relevant real-life experiences, not just work-based experiences, to be used)

- veracity (behavioral questions are more difficult to fake as follow-up questions can be used to gather more detail)

. The behavioral review structure should include

- competency-based behavioral questions (interview questions related to the job as determined by the job analysis, such as job description or advertised requirements for the job)

- common interviewer(s) and questions for all interviews (this brings a degree of consistency to the judgments being made; training of interviewers may be required; consistency, ie standardisation of questions and interviewers creates the basis for fair comparison; remember: it is the skills that matter, not the context in which they were applied)

- use of agreed rating scales for all questions (a rating scale significantly improves the consistency and reliability of candidate evaluation; interviewers need to know what the scale stands for)

. Behavioral interviewing is limited as it is based on 2 assumptions

i) that behavioral patterns are consistent over time, ie past behavior is a good guide to future behavior but people do change over time

ii) candidates can be compared fairly on the basis of past behaviour. In reality, candidates have different past experiences that have differing degrees of relevance to the behavioral requirements of the job under consideration

. Limitations of other selection techniques are

"...- situational interviews assumed that a hypothetical response is a good indicator of future behavior, even though we know that intentions are not always a reliable guide to actual behavior.

- ability tests assume that tests can fully and adequately capture all the relevant aspects of the job

- personality profiles assume that what we call personality is a stable construct that can be measured accurately by any one test at any one time. Further, they assume that personality traits can be accurately linked back to job performance, when in many cases they cannot

- assessment centers, the most reliable of the techniques (and the most expensive), are based on the assumption that the array of tests and exercises a candidate has to complete will adequately capture what is entailed by the actual job..."

Harry Onsman, 2004d

. In addition to interviewing, referee checks should be conducted

. In preparing for a selection interview, the following needs to be done

- define competencies or skill areas for the job (job analysis - it identifies, determines and ranks the particular job duties and requirements; it is not a description of a person but of a position; included are the critical behavioral requirements)

- develop behavioral questions for each skill area (once a set of skills has been identified then a set of questions is developed; the degree of specificity can vary with the requirements of the job; use phrases such as

"...Tell me about a situation where you.....

Have you been involved in the situation where.....

How did you handle instances of......

Have you had to........

Include follow-up probes such as

What did you do?

Can you give me an example?

What happened?

How did you respond?..."

Harry Onsman, 2004d

- develop rating scales (need to achieve consistency over time, both with each interviewer and between different interviewers; use standard descriptions

- ensure that the same questions and interviewers are used for all candidates (the purpose of training is to discourage ad hoc questioning)

. Used peer interviewing process as a reality check by asking people who will work with the potential candidates to spend some time with them to evaluate their suitability for the position; in particular can they work with each other?

Structural interviewing technique is another technique which involves following a rigid format with each applicant being treated identically; questions are scripted; interviewers are carefully trained; each applicant is rated on a series of predetermined scales. Usually the objectives of the interview are relatively narrow and it is not about getting to know someone.

External Vs. Internal Candidates (especially for senior management positions)

. In general, organizations are looking for people who have strategic clarity, can communicate, ensure staff commitment and focus on the delivery. At the same time they have the capacity to, and are willing to, challenge current assumptions, processes and structures and are innovative and flexible, ie change their styles of management accordingly. One avenue for identifying suitable candidates is external recruitment.

. It is claimed by Anthony Mayo and Nitin Nohria (2005) that the impact of a CEO can vary an organisation's performance by around 14%

. In the USA, outsiders are chosen into CEO successions up to 1/3 of the time. The traditionally-held view that "outsiders"have a higher risk of failure is more than balanced by the chance of perceived benefits by way of a fresh point of view, lack of attachment to the status quo and a wider experience.

"...The perfect CEO has the knowledge of an insider and the perspective of an outsider..."

Phil Condit, Boeing's Chief Executive and Chairman as quoted by John Davidson, 2001

Furthermore,

"...What's clear is that the old system of succession ‐ the life-time devotion to one company, the apprenticeship to the incumbent, the long expected tap on the shoulder, has almost disappeared..."

Andrew Cornell, 2003

. Research conducted by Boris Groysberg et al (2006) found that bringing an outsider in as CEO works best if the CEO comes from the same industry and/or brings a management team (and system) with him/her from his/her previous organisation. The hardest requirement of any new senior manager is to understand the tacit knowledge about the unique routines and procedures, corporate culture and informal norms, and to have experience with the specific management systems and processes used in his/her new organisation.

CEO ( outsider versus traditional)

  Outsider CEO Traditional CEO
Experience first time CEOs with little prior managerial experience experienced managers with many years of managerial experience
Primary activity capital allocation operational management and external communications
Objective optimise long-term value per share growth
Key metrics margins, returns, cash flow, etc revenues, reported net income
Personal qualities analytical, frugal, independent charismatic, extroverted
Orientation long-term short-term

. External recruitment can be important as it brings in new talent, dynamism, perspectives and increases diversity in thinking and approach so that the organization is better able to handle the market changes at both the strategic and operational levels, such as in the global marketplace and increased consumer demands. Customers expect more than just excellent products and services; they want solutions and partners. In organizations that need transforming, internal recruitment into management can be self-defeating if the organization is suffering from malaise and needs a change of direction. Outsiders who bring in experience from competitors and customers can increase the organisation's understanding of the drivers behind the customers' demands

. Remember: any outsider appointed to an organisation has the problem of understanding what the organisational culture is and what the culture is doing for the organisation. In addition to these outsiders having the necessary competencies and motivation, they need to be aligned with the organisation's culture and values. If these outsiders do not share the organisation's values and do not reinforce the value system through the reward system, their management style and the messages they communicate, they can have a disastrous impact on the performance of the organization.

. An insider has a better understanding of parts of the culture that provide identity, its distinctive competence, protection from anxiety, etc. An outsider would find it hard to understand the subtleties, other cultural issues, the emotional relationships, etc that have developed in the organisation

. External recruits take much longer to align, understand the political plays, the rules of success and the organizational norms, while internal recruits have a better understanding of the "unspoken hurdles"in the organization. Furthermore, internal recruitment boosts organizational morale, encourages career path development and builds internal leadership capabilities.

. Bringing in an outsider usually means that that he/she is a cost

"...Typically it takes around 6 months for managers in new roles to add value to a company..."

Michael Watkins as quoted by James Hall, 2004e

In large organisations with many layers of management, this cost can be into the millions of dollars. Furthermore,

"...2 out of 5 managers fail in their roles in the first 18 months. That can mean $780,000 per manager for failed transitions..."

Centre for Creative Leadership as quoted by James Hall, 2004e

. Whether employing an outsider or insider depends upon whether organisational changes are needed. If continuation of the current organisational culture is the priority, the insider will be preferred as this person

- knows the organisation

- understands the culture

- understands the organisation's business.

. If changes are needed, the choice is not so clear. Generally, an insider will have more credibility to introduce the change as he/she is more acceptable to the organisation, ie he/she is regarded as "one of them". If an outsider is employed, he/she will need to have active support from key opinion-makers in the organisation for the change to be effective and/or bring into the organisation his/her own "loyal"staff from outside the organisation to occupy key positions in the organisation. If he/she does not have active support of the key staff, the effectiveness of the change will be negatively impacted, if not "doomed to fail"

. Remember: right people (whether external or internal) must have the correct attitude, ie they are eager to learn, possess a strong personality and have a pro-active attitude. These characteristics are more important than expertise, skills and experience, as generally they can acquire these things. Thus it is more important to look for the right "fit"on culture, values, behaviours and attitude

. In addition to employing people who have the right fit in attitude, etc, a good rule of thumb is to look for people who have around 60 ‐ 70% of the expertise required to handle the position; the remaining 40 ‐ 30% allows for growth in expertise, etc to handle the position. This means that the individual will be challenged and is thus less likely to become bored and want to change jobs. Furthermore, it is very expensive to have to replace staff. Some people estimate that it costs around $300,000.00 to nurture a graduate into a senior position

. There is increasing USA evidence that it is generally better for an organisation to develop its own "star talent' than to recruit from outside. It has been found that company-specific competencies drive star talent

"...it isn't just that people make organisations better - the organisation also makes people perform better..."

Boris Gruysberg et al, 2004

The executives' performance depends on both their competencies and abilities, and on the organisation's systems, processes, procedures, leadership style, etc. The "star"needs to unlearn old practices and learn new ones (including the subcultures, personalities, relationships, etc within the organisation). USA research has found that in around 50% of those organisations which hire a star from outside, several things happen, ie

- star's luster fades

- their performance falls sharply

- their performance never achieves previous high levels

- other staff members' performance suffers as they can resent the appointment of the "star"

. Some important criteria for recruitment and/or promotion include

- *motivation and work ethic

- *ability to fit organisational culture

- *intellectual capacity to handle the position

- *ability to gain respect of clients and staff (including likeability)

- knowledge of the industry and organisation

- expertise (skills) to handle the position

(NB * indicates the most important criteria of the 6)

Remember: in recruitment, ie hire for tomorrow, not today

According to Mark Granoveter (1995), over 50% jobs are obtained via personal connection and not necessarily with a close friend. Many people believe that the closer an acquaintance the more helpful they will be. On the other hand, it has been shown that the more casual the acquaintance, the better the help. These casual acquaintances have different connections to you than your close friends and can be more objective in their evaluation of you. As well as improving your appointability, being referred to a role as many pluses for an employer, ie saves costs, reduces the need for reference checks, gives credibility, etc.

. Once a new manager is appointed, usually they need help to overcome their misconceptions or myths about your position in management. According to Linda Hill (2007), the myths v. reality are

Details

Myth

Reality

Defining characteristics of the new role

authority - have the freedom and autonomy to implement ideas; focus on the rights and privileges of being boss

interdependency - become enmeshed in a web of relationships (importance of networks)

Source of power

formal authority - can get things done; autocratic approach (staff will follow orders); don't delegate

credibilty, trust, competence and influence - need to develop credibility and trust as staff are wary and you really have to earn their respect and trust (no blind loyalty to following orders); need to demonstrate competence as a manager (knowing how to do the right things; more listening than talking; don't micro-manager) and influence (ability to deliver and execute the right thing through a strong web of interdependent relationships)

Desired outcome

control - must get compliance from staff (compliance does not mean commitment); too much reliance on formal authority whose effectiveness is questionable; staff do not take initiative nor delegate

commitment ‐ empower staff so they take initiative while managers delegate effectively and direct reports take calculated risks

Managerial focus

managing one-on-one - role is to build relationships with individual staff and as a flow-on, with the team; primary focus is individual performance, identifying and solving problems

team-building responsibilities - need to create a culture that will allow the team to fulfill its potential and harness the collective power of the group to improve individual performance and commitment; supervising each individual is not the same as leading a team. This involves managing interdependencies, and exercising informal authority derived from personal credibility requires new managers to build trust, influence, and mutual expectations with a wide group of people; establishing productive personal relationships

Key challenge

keeping the operations in working order - job is to make sure all the operations run smoothly; maintaining status quo thinking; see responsibilities very narrowly; blame flawed system and others for problems

making changes that will make the team perform better - responsible for initiating changes to enhance the group's performance; acting as a change agent by challenging status quo; working through both formal and informal structure

. Usually managers find a new role is

- a stretch assignment - it is considerably more demanding than anticipated; expertise to handle their previous position is different from that required for the new position, ie

"...as managers, they are responsible for setting and implementing an agenda for a whole group, something for which their careers and individual performance haven't prepared them..."

Linda Hill, 2007

- learning to lead is a process of learning by doing - it is a craft best acquired through on-the-job experiences, including adverse experiences when working beyond your current capabilities, and proceeding by trial and error, ie

"...Most star individual performers haven't made many mistakes, so this is new for them. Furthermore, few managers are aware, in the stressful, mistake-making moments, they are learning. The learning are incrementally and gradually. As this process slowly progresses - as the new manager unlearns a mindset and habits that served him over a highly successful early career - a new professional identity emerges. He internalizes new ways of thinking and being and discovers new ways of measuring success and deriving satisfaction from work......this kind of psychological adjustment is taxing. As one new manager notes, I never knew a promotion could be so painful..."

Linda Hill, 2007

- need to create the conditions for success ‐ this includes asking for help (remember: no one has all the answers)

 

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