Executive Selection & Integration: Stumbling to the Top
The Challenge and Complexity of Internal Leadership Transitions
Building on its groundbreaking research into the integration (onboarding)
difficulties faced by executives hired from the outside*, RHR International has
shifted its attention to the failure rate of leaders promoted or transferred within
the same organization. Studies suggest that up to 25% of these executives will
fail
(DDI, 2006; Institute of Executive Development, 2008).
RHR International recently completed a year-long research project investigating
the integration hurdles leaders face when they are promoted from within.
While you might think that these individuals would have a distinct advantage
over those hired from the outside, our new research finds these executives face
challenges of their own.
RHR International
We see what others don't.
EXECUTIVE RESEARCH FINDINGS
KEY FINDINGS
"Had I known then what I know now, I would not have taken the
job.
It is 50/50 whether I will stay with the organization."
Internal leadership transitions are far more complex and challenging
than one might realize. A significant number of transitioning leaders
will encounter difficulty and be at risk of derailing.
What is most surprising about the data is not just how many leaders
were struggling in a new role, but how long – well past the time we
would have expected them to have integrated.
By the 10-month mark, up to 40% find the transition a challenge;
20% rate it a downright disappointment. Even for those whose
overall experience is positive, the challenges they report facing were
real, visceral and often unexpected. Key challenges include gaining
clarity around their role, re-negotiating relationships, establishing
influence with a new peer group, quickly reinforcing credibility with
stakeholders, rapidly acquiring new knowledge, and closing skill and
experience gaps.
Thought Leaders in Executive Selection & Integration
For more than sixty years, RHR International has been assessing
candidates for new positions and applying best practices to
ensure their successful integration. By addressing the reasons
most people fail, RHR consultants are able to increase the probability
of success, improve retention rates and accelerate the
performance of executives at the highest levels of management.
RHR has been a major contributor to the understanding of
executive transition through major research projects (2002,
2005) as well as large-scale, structured Executive Integration
programs in a number of client organizations where we have
been able to measure the impact of our methods on retention.
Our latest studies (2009) have addressed the unique challenges
faced by executives promoted or transferred within the same
organization. This summary describes the results of this
research plus the collective insights of our consultants over
six decades.
Internal Leadership Transitions
Are Improved by
Focusing on Six Key Success Factors
"I am feeling more comfortable in the role. I have a better
understanding of the goals, objectives, and how things work.
A few months ago, I was questioning my value. I had people
challenges, results challenges. The job wasn't meeting my
personal expectations."
Our research identified Six Key Success Factors that, if attended to,
can lead to a smoother, more successful transition:
- Role Clarity and Alignment
- Re-contracting and Building Relationships
- Adapting to a Sub-Culture
- Early Wins
- Accelerated Learning
- Targeted Development
Success Factor #1: Role Clarity and Alignment
"I now understand my mandate, but am a bit unclear about
some of the
limits of my authority as part of the senior
management team."
This Success Factor encapsulates all aspects related to understanding
the role, mandate, and expected deliverables. It includes
understanding and managing a new team and operating within the
broader organization structure. The single biggest complaint we
heard from leaders was a lack of clarity around the role and their
boss's expectations. This issue was one that didn't resolve itself
quickly or easily. For example, leaders in the first 3 months of their
transition indicated they understood their job 85% of the time. This
drops to less than 60% six months later.
External hires do not struggle in the same way with role clarity. One
reason may be that those promoted from within are less likely to
have the opportunity to thoroughly discuss the position as part of
the selection process. This lack of candid conversation between the
executive and his or her boss before (and again after) the move can
lead to misalignment and missed expectations. In the case of external
hires, many have done a job similar to the one they are assuming in
a new company – they have been hired for their experience. Those
transferred from within are taking on responsibilities that may be
brand new to them, often at a level in the organization that has new
and different expectations of its leaders.
Operating on assumptions is a key theme that dominates the
research on internal transitions. The new leader assumes she knows
what the job entails and what her boss expects. She is reluctant to
ask for too much help. Her boss and others assume she should know,
and spend less time teaching, coaching and communicating.
Operating on assumptions leads to over-confidence and unwarranted
optimism at early stages of the leader's transition. And when issues
linger, unresolved, they lead to frustration, disappointment, and
waning self-confidence.
Success Factor #2: Re-contracting and Building Relationships
"I had some meetings with key individuals before I made the
move. However, there were some people I didn't realize I needed
to connect with and either connected too late or didn't meet
with them often enough. This turned out to be a problem."
Relationships are critical for getting things done. Internal hires
often have pre-existing associations with their new boss, peers, and
direct reports and can leverage these to accelerate their integration.
One potential pitfall is assuming that "knowing someone" equals
"relationship." New leaders can overestimate the strength of a
relationship or over-rely on their reputation to establish credibility
with peers and others.
"The most difficult thing has been earning the respect of
peers – those who were accustomed to seeing me at a level
below them."
When a leader's position changes relative to others, as when former
peers become direct reports or former superiors are now peers,
condescension, jealousy and resentment may manifest themselves.
Leaders often struggle to assume leadership over a group of former
peers. The reality is relationships are complicated; people take their
history with them. Internals do not have the same opportunity to
build a reputation from scratch the way external hires do. There may
be relationships that need forming, strengthening, re-defining, or
repairing. Our research suggests that relationships with peers were
the most difficult to navigate.
Success Factor #3: Adapting to a Sub-Culture
"I have been with the organization a long time. I know how to
get things done."
Internal transfers have a distinct advantage over those brought in
from the outside in understanding the culture and how to get things
done. Leaders are quick to identify even subtle differences in team
culture from their last posting and understand how they need to
adapt to be successful. In some cases, leaders may not want to make
the changes required to fit into a new culture. Leaders who see their
role as change agents must walk the fine line of gaining respect
while resisting pressure to conform.
"I'm driving to get things done but I'm bumping up against
people I don't have authority over."
For those promoted to a new level, adapting to new political
dynamics was salient. While most executives said they understood
the politics, they still struggled to navigate them. Leaders who
advance to a new level can underestimate how difficult it is to
influence others to support their goals and plans. Early on, they
tend to assume their new position, reinforced by their reputation,
will suffice. What they often discover, too late in the game, is that
their effectiveness is inhibited by a lack of strategic focus on forging
critical relationships and building the credibility they need to
effectively influence others.
Success Factor #4: Early Wins
Getting an early win to establish credibility is a critical area of
emphasis for external hires. We found those transitioning internally
put less pressure on themselves to chalk up early wins. Executives
who transition internally tend to overlook this key Success Factor;
they assume they are already a "known entity" and don't express
the same concerns about needing to prove themselves. They overlook
the fact that others are expecting them to demonstrate they deserve
the job, and thus miss an important opportunity to quickly and
effectively establish themselves in their new role.
Success Factor #5: Accelerated Learning
"I may not be aware of every gap in my knowledge, but I have
a plan to learn what I think I need to know. The rest I will figure
out as I go along."
Taking on a new role will inevitably reveal gaps in knowledge and
experience. These may not be as great as those experienced by
external hires, but to assume someone knows everything they need
to know when they step into a brand new role is unrealistic. One of
the challenges is overcoming the assumption, on everyone's part,
that the new leader knows everything just because he or she has
been in the company. External hires are given more leeway when it
comes to learning. The task for the leader moved internally is to get
up to speed as quickly as possible. Early in their assignments, most
executives acknowledge their biggest learning gaps include learning
the business, the organization, and the people.
"I still have one foot in my old job, one foot in my new role... I'm
concerned that it may keep me from delivering."
When organizations allow for job overlap – someone is expected to
do some, or all, of their old job while trying to learn the new one –
they delay the learning curve and the transition. Someone hired from
the outside is not expected to multi-task in the same way. Indeed,
who would tolerate an employee who is spending 30% of their time
with their former company? And, yet, we expect our internal leaders
to do this all the time.
Success Factor #6: Targeted Development
"I need more development regarding business, financial,
strategic acumen, and leadership at this level."
Whereas for external hires the key challenge is to integrate into a
new organization, internal hires face two challenges: to integrate
into a new role and to develop the knowledge and skills required
to operate at a different level or in an unfamiliar function. Leaders,
again, tend to overestimate how prepared they are to take on
a new role. Over time, gaps in skills and capabilities required to
be successful emerge.
While in the first 3 months almost 80% of executives rated
themselves as prepared to take on their new role, by month 10,
this dropped to 40%. They start to feel the gaps in their leadership
and higher-level business skills (which they hadn't anticipated or
prepared for) very acutely.
"I'm frustrated in this role. It does not do anything for my
development or advancement."
In some cases, leaders come to realize that the new role is not going
to satisfy their needs for career development and advancement.
There will always be times when extraordinary things are asked
of extraordinary people to help the organization successfully meet
its objectives. But consistently failing to align succession plans with
an individual's needs and expectations can lead to disillusionment
and departure.
How Organizations Can Improve and Accelerate Leadership Transitions
Many organizations have robust, effective processes for recruiting,
selecting and onboarding external talent. The application of these
proven procedures to internal placements should likewise enhance
the success rate of these transitions and accelerate the performance
of promoted executives. Our research highlights areas where organizations
can focus to maximize the success of their internal transitions.
Before the Transition
Defining the role and context before a formal selection process
occurs is critical for success:
- D evelop a formal job description that defines critical skills and
competencies so the selection criteria are clear to everyone.
This includes defining unique cultural aspects of the role (e.g.,
geography, team dynamics, group culture, etc.) where interpersonal
"fit" issues may be relevant.
- G enerate a complete roster of potential candidates. Too often
internal hiring decisions are made based on only one or two
people without thoroughly vetting alternatives.
- Involve the hiring manager early. Without this person's initial
input before the selection, and active support afterwards, the
promoted executive's chances of being successful are significantly
reduced.
Making the Decision
"I'm still trying to define the real expectations of my boss.
They have never been fully communicated, or maybe I didn't
understand them."
Just as with external selection, once the hiring criteria and the
context have been defined, potential candidates can be screened
and assessed against these standards in an objective way. The
process should:
- Include a formal selection process that compares candidates
against the success criteria for the role. This also provides the
opportunity to test the readiness of the individual for advancement
to the next level and to hone in on specific gaps that will
form the foundation of a transition and development plan.
- Incorporate multiple interviews so the candidate can start to
form an understanding of the role, boss and peer expectations,
and anticipated challenges. In addition to ensuring there is fit on
both sides, this will kick-start role clarity, an issue that plagues
internal transfers.
- Ensure the hiring manager supports the decision. Forcing
someone to accept a direct report not of their choosing is a
recipe for disaster.
- Offer the job to the successful candidate in a non-threatening
manner. Forcing people to make snap decisions about taking a
role (and not being serious about it being optional) doesn't help
the organization or the leader.
- Anticipate integration challenges. Where is this person most likely
to struggle? Engaging in this analysis early will help ensure the
right support is offered immediately. This will help to accelerate
the leader's successful transition.
- Result in a clean break. Asking leaders to take on a new role
while they are still filling their old one is an all-too-common
scenario. Plan your transitions so these overlaps are minimized.
Post-Transition Support
"When I first started I underestimated the amount I had to learn
and the scope of information I would need to stay on top of."
Don't abandon the executive once the selection decision has been
made. While the specifics may vary, a leader who is changing jobs
inside his or her company faces just as many potential obstacles
as those who come in from the outside. Whereas external hires
need more time to get up to speed on processes, culture and the
business, internal hires have the challenge of overcoming reputation
and re-contracting relationships. External hires probably step into
the role with the skill set they will need to be successful and have
impact early. Executives promoted from within usually have gaps
in their skill set they will need to close. Providing the right kind of
support to a new leader can make the difference between success
and failure. Strategies to consider:
- Ensure the boss is engaged as a partner in the leader's transition
and ongoing success. This is the single best predictor of transition
success.
- Identify key integration challenges for each person and customize
your support initiatives. Ensure goals and expectations are
formalized and documented.
- Share assessment feedback – key strengths and identified gaps.
Use this as the foundation for a development plan targeted at
rapidly closing gaps that are critical for success. A coach may be
needed to accelerate learning.
- Monitor progress past the first 3 months. Internal transfers report
struggling most in their new role well past the 6-month mark, and
long after external hires seem to have settled into the routine.
Areas to pay special attention to include role clarity, relationships
and developmental progress.
In Summary
Successful leadership transitions are challenging whether an
executive is hired into a new company or takes on a new role or set
of responsibilities with an existing employer. Internal transitions
have an added layer of subtlety and complexity that is lacking in
external transitions. Our research suggests it is taking leaders
moving into new roles inside their organizations too long to
integrate. Five reasons seem to dominate:
- A coherent understanding of the role, how it interfaces with
others in the organization, and the expectations of one's boss
and others takes too long to resolve.
- T he importance of re-contracting relationships, establishing
influential alliances with peers, and reinforcing one's credibility
with others in the new role is overlooked.
- Recognizing one's development gaps vis-à-vis operating at a new
level of leadership occurs too late.
- Assumptions run rampant on all sides, interfering with open,
candid dialogue and thereby decelerating the integration timeline.
- A new position is over-interpreted by the leader as an unqualified
vote of confidence, leading to an unwarranted level of overconfidence
and optimism. Problems and issues are dismissed too
quickly and allowed to fester, leading to frustration, disillusionment
and derailment.
"They assume I know the company because I came from within."
Organizations should apply the same methodical approach to managing
their internal succession as they do their external recruitment
and hiring. This research identified Six Key Success Factors – role
clarity and alignment, re-contracting relationships, adapting to a
sub-culture, early wins, accelerated learning, targeted development
– that provide a road map for organizations to more effectively
manage internal transition, get leaders up to speed more quickly,
and reduce the likelihood of failure.
Methodology
In-depth interviews were conducted with 150 leaders from 59
different organizations located on 3 continents. Multiple levels and
functions were represented, with 35% coming from the CEO/Executive
Vice President/Senior Vice President ranks and 38% from the
Vice President ranks. Sixty-nine percent of those surveyed were
in a new role due to a promotion. Participants ranged from 1 day
to 36 months in role. Thirty-one percent were female; no gender
differences in the quantitative data were reported.
For more information, please contact Dr. Rebecca L. Schalm,
Global Practice Leader, Executive Selection & Integration for RHR
International at rschalm@rhrinternational.com.
About RHR International
We are a firm of management psychologists and consultants who work closely with top management to accelerate individual, team
and business performance. We focus on five key areas of client need – Executive Selection and Integration, Accelerated Executive
Effectiveness, Senior Team Effectiveness, Management Due Diligence and CEO Succession. We have been proven difference-makers
for more than 65 years, unique in our combination of top management focus, psychologists' perspective and high-level business
acumen. RHR International has offices in Belgium, Brazil, Canada, China, France, Germany, Italy, Switzerland, United Kingdom and
United States. The company is headquartered in Chicago, Illinois.
For more information, please visit us at:
www.rhrinternational.com
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