Business leaders who “derail,” or fail to achieve expected success, are often thought to be victims of their own foibles. These include poor relationships with superiors, peers and subordinates; failure to build and lead teams; inability to cope with change; and failure to meet business objectives.
Not surprisingly, executives hired from outside the organization are more likely to fail than internally promoted candidates.
In one recent study, executives estimated the failure rate for external hires to be 35%, compared with just 24% for internal candidates. In another, nearly two-thirds of new presidents hired from outside the organization left their companies within four years, compared with only about one-third of those promoted from within.
Why the difference? Perhaps internal candidates have an advantage, knowing the corporate culture and the key players. Organizations themselves may be more “forgiving” of miscues committed by their own. At the same time, organizations may have higher expectations of external candidates, who come in with impressive credentials and achievements.
So how can newly hired executives minimize the risks for failure?
“The best advice for anyone coming in off the bat is to look and listen very carefully before making any major changes,” says Dan Jones, Ph.D., a member of WJM Associates’ executive coaching and assessment faculty. “Learn something about the organization and take time to gather your own impressions before making any major business or strategic decisions.”
Jones also encourages newly hired executives to build a solid core of relationships -- laterally, up and down -- so they have people they can work with. “People who are in leadership positions can’t get it done all on their own,” he says. “They have to get things done through others.”
Another key step to minimizing failure: Find out what kind of impact you’re having on the organization. “Executives should have two or three confidants who can give them candid feedback, good or bad,” says Jones. Another effective option is to work with an executive coach who can gather that feedback objectively and independently.
While executives themselves take appropriate steps to minimize failure, organizations can also do their part by providing candidates with unblemished information about their culture and challenges. They can try to be realistic in terms of understanding how long it may take for a new candidate to move into a new position, and to provide that candidate with resources to help with the transition.
A large, global financial services company has a program where everyone who comes in above a certain level goes through an assimilation program. Three or four months after they’ve been hired, an executive coach conducts a set of 360-degree interviews with superiors, colleagues and direct reports. The coach then summarizes those interviews, provides feedback to the new hires, and works with them on a limited number of sessions to help them understand the feedback and develop a directional plan.
“It took the company years to set up the process, but it’s institutionalized now,” says Jones.