Happy Fourth of July weekend! As we celebrate the independence of America, we have to reflect on the leaders that made it possible. This reminds us of how critically important the leaders within our organization are to the success and evolution of our business. How would you rate the leaders at your organization?
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. Selecting the Wrong Leader Can Cost Your Organization More Than You Think
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. All Employees Lose 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 immeasurable. The negative consequences of a bad hire or placement can continue long after the individual has been terminated.
3. Find 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.
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and potential, I now come to the culminating corner, the penultimate piece of your succession plan. The upper-right corner of the performance-potential matrix is where, in a perfect world, all of your staff would reside. The All Stars in your organization are those people who are realizing their full potential while at the same time performing at their peak. This is the dream team of organizational players. They are well-equipped to take on any assignment and poised to transform your organization into a better version of itself. But caution must be taken with these rarified All Stars for they can easily become bored and thence, to your dismay, lured elsewhere. Accordingly, I offer a brief care manual for best practices in sustaining and cultivating the "top guns" in your succession plan.
