Booz & Company recently published its 12th annual CEO Succession Survey. It’s fascinating reading:
- As the economy gets stronger, the numbers of CEOs leaving their jobs are rising to pre-recession rates
- CEO turnover is highest at the largest companies
- CEO turnover is highest in market sectors that face the most challenges
- Outsider CEOs returned to historical averages
- Insider CEOs bring higher returns
- Insider CEOs serve longer
- The combined chairman-CEO model continues to decline
With average CEO tenure declining, the survey’s data are clear that new CEOs – whether they come from the inside or the outside – are under historically high pressure to perform quickly. (Can you say Leo Apotheker?) And concerned boards are more frequently appointing the outgoing CEO as board chairman to provide a sort of “apprenticeship” experience in the early months of a new CEO’s tenure. Interesting stuff.
This year, the study focused on the new CEO’s first year. Booz & Co. interviewed a number of CEOs from around the world and asked their advice for incoming CEOs. There were 7 common recommendations:
- Deal with the obvious executive team changes as early as possible
- Be wary of changing strategy too quickly, even if you think the current strategy is wrong
- Make sure you understand how every part of the company operates and how it is performing
- Build trust though transparency
- Be selective in listening to advice
- Find a sparring partner with whom you can discuss plans openly
- Manage your time and your personal life with care
The survey provides a great deal of background data and commentary on these 7 “tips” for succeeding as a new CEO — and I encourage you read it. But I’m thinking this is great advice for any new executive at any level.
And I’m really thinking this list is great coaching for HR.
The furniture conversation (see my post on that subject here) that HR is so fond of having is, at its heart, a lament about HR not having strategic business credibility. I don’t buy that HR lacks strategic business credibility. I do buy that HR isn’t communicating mission critical data to the C-suite and that creates a credibility challenge.
New data will be published shortly by Achievers that highlights the disconnect between what HR and CEOs believe about key elements of employee engagement in their organizations: feedback, managerial communication and recognition. And it’s pretty eye-opening!
When we designed a survey to evaluate how employees rate the current state of these workplace dynamics in their organizations and whether CEOs and HR professionals are in touch with what employees want, we found an added dimension in comparing the differences between the perceptions of CEOs and HR professionals.
- For example, when we asked CEOs and HR professionals whether they agreed that their employees believe that their organization inspires them to do their best work every day, 61% of CEOs strongly agreed or agreed, while only 31% of HR professionals strongly agreed or agreed.
- When we asked CEOs and HR professionals whether they agreed that their employees rated their organization culture as positive, strong and motivating, 67% of CEOs strongly agreed or agreed and 37% of HR professionals strongly agreed or agreed.
Wait. It gets worse.
- When we asked employees if they agreed that the feedback they received from their managers was constructive and useful, 79% of CEOs believed that their employees would strongly agree or agree while only 33% of HR professionals believed that their employees would strongly agree or agree.
- When we asked employees how frequently they received feedback from their manager, 56% of CEOs believed that employees would report receiving feedback immediately or on-the-spot. HR professionals? 11% believed that employees would report receiving feedback immediately or on-the-spot.
These are just four examples in the survey that show the continental divide between how CEOs and HR professionals evaluate crucial aspects of their employees’ engagement. With these results that underscore the CEO – HR disconnect, we could hypothesize that CEOs have a more optimistic view of their workforce because any time they interact with employees, employees are on their best behavior – trying to impress the boss. HR, on the other hand, frequently interacts with employees when they are not at their best: exit interviews, investigations, disciplinary situations, etc. It’s understandable that HR might have a more pessimistic view of their employee population.
Absent data to the contrary, why shouldn’t CEOs be optimistic? If there were issues, surely, they might think, HR would share the data. But when the employee engagement data is consistently less positive than CEOs’ perceptions, it”s clear that CEOs aren’t getting data that informs them of the reality of their workforce. And who has this data? Well, that would be HR.
So why isn’t this data – and their ramifications – being shared with the C-suite? For HR to understand the workforce and know what is working and what isn’t clearly isn’t enough. Communicating mission critical data and serving up cost effective solutions are HR’s opportunity. Heck. Most would say that’s HR’s job! For certain, they are the ticket to strategic business credibility.
If we needed tangible proof of the CEO – HR disconnect, this survey’s results confirm it. You’ll be able to download it on June 12 from the Achievers website.