Happy belated President’s Day! As we reflect on and acknowledge the great leaders in U.S. history, it reminds us of how critically important the leaders within our organization are to the success and evolution of our business. So, how are the leaders at your organization doing?
Given today’s economy and hyper competitive global markets, executive selection and development is more important than ever before. The cost of leadership failure can often mean the success or failure of the entire organization. Every executive or leadership personnel choice is a high stakes decision for organizations, their shareholders, and associates, so it’s extremely important to have accurate information available when making these decisions. Here are four points to keep in mind when you are assessing your leaders:
1. The financial costs of not getting the right talent in the door can be outrageous
These costs not only include lost business, but also turnover costs. Estimates of executive turnover costs range from $300,000-$1,000,000 depending on the size of the company, and can increase dramatically the longer they stay with the organization. Accurate information on a candidate’s assets and limitations, as well as promotion potential, can help to make a more informed hiring decision.
2. Everyone loses when a new leader fails
Goals aren’t met, opportunities are missed, and relationships may be irreparably damaged. Employee morale can also be negatively affected. The “soft” costs of derailment can be incalculable. The negative consequences of a bad hire or placement can continue long after the individual has been terminated.
3. The right people for the right job
Getting a clear picture of the strengths and liabilities of your entire leadership team can help ensure the right people are placed in the right roles. This can also help to defray the direct and indirect costs of derailment.
4. Develop your internal leaders.
Grooming internal candidates for the most senior positions is often the best succession plan. An individual who understands the organization’s culture and business goals can accomplish more in a shorter time than an outsider.
Even small, incremental improvements in selecting and developing your leadership talent now can result in big gains over time. Bottom line, investing in a good executive assessment process will increase an organization’s competitive advantage.
How are you currently hiring for leadership positions? Comment below to start the discussion!