Recruiting and integrating executive leaders is one of the most impactful decisions for any organisation. An effective executive search process has the power to reshape an organisation’s strategy, enhance its culture and increase its impact. Conversely, a poor process can freeze operations, impact reputation, and damage employee morale.
One reason these searches are so risky is their infrequency. In the case of Chief Executive Officer or Executive Director searches, years or decades might pass between the searches. As a result, understanding of the best practices to mitigate risk may become outdated or irrelevant.
Organisational leaders, especially Boards and HR / Talent teams, must proactively identify and mitigate risks in executive searches. This article outlines ways to manage these risks and best practices for mitigating them. These insights draw upon SRI Executive’s more than 25 years of experience managing critical executive searches for global development and humanitarian organisations. We help ensure our clients navigate these journeys with diligence and foresight.
Types of Risk
What risks exist in executive search processes? What do organisations have to be mindful of as they navigate these processes? They include the following:
Key Steps to Mitigate Risk
Now that we’ve outlined the risks organisations face with executive searches, let’s examine the structured steps they can take to mitigate these risks.
The critical first step is identifying the role’s key responsibilities, competencies, and experiences. This is a structured process where Board Members, senior leaders, staff, and others are aligned on key criteria for the role. Building a common understanding across these stakeholders sets an appropriate foundation for a structured and inclusive search.
The next step is to reflect on its culture and be explicit about the role culture should play in this search. It may be helpful to undertake a culture survey, which is a valuable tool to understand the organisation's shared values, beliefs, and behaviours. Defining aspects of organisational culture “out loud” can help facilitate a conversation about how to build cultural diversity, not just cultural fit.
As organisations execute a search, it’s critical to ensure a positive candidate experience. A good way to view the executive search process is like early onboarding. You want the candidate to get a strong understanding organisation’s goals and values as much as they do about the role. You need to communicate regularly with candidates about the status of the search. If they are declined, you should aim to give them constructive feedback whenever possible. Always convey the importance of confidentiality; you never want a candidate’s interest in a role to become publicly known.
The candidate experience is especially important for internal or referred candidates. You must ensure those candidates are treated fairly throughout the process. If an internal candidate or one close to the organisation is declined for the role without clear communication or feedback, it could further damage the organisation’s internal morale and external reputation.
A key part of the candidate experience is having a structured and efficient interview process. Aim to hold no more than four interview rounds, typically with panels, to balance the depth of assessment with efficiency. The panel members should include stakeholders from the organisation at different levels, including staff members, to ensure that all perspectives are represented. Key decision-makers should be identified early in the process to ensure interview choices are made efficiently. Competency-based interviewing also ensures you’re assessing candidates on the key needs for the role, the ones agreed upon during the early planning phases.
Having a structured search and interview process allows the organisation to prevent bias and promote diversity throughout the entire process. Building a strong understanding of the role's needs allows the organisation to find talent from areas it wouldn’t normally consider. Having a competency-based interview process ensures that panel members aren’t swayed by cognitive traps like the “prestige bias,” which favours candidates from well-known organisations.
It’s important to have a transparent process when it comes to salary negotiation. When building the job description, ensure you’re transparent about the salary when possible. Be ready to communicate what you’re flexible or inflexible about when it comes to salary, bonuses, relocation, visas, and other important logistics.
The final phase is to build a structured onboarding and integration process for the new leader. The end of the search is only the beginning; now you must set up the new leader for success. You can build an onboarding plan that identifies key milestones, promotes relationship building with key stakeholders, and outlines opportunities for early wins. Continuing to build cultural alignment is also critical so the new executive can build an appreciation for the organisation’s nuances and dynamics. Regular check-ins and early feedback are also critical during onboarding to ensure the new executive feels supported and aligned during this critical period.
Managing risk in executive search is not a “nice to have”. It is imperative to ensure that organisations find the right leader and don’t fall into risky behaviours along the way. SRI Executive brings over 25 years of experience successfully navigating executive searches and building a nuanced understanding of how to manage these risks proactively and effectively.
In addition to our extensive experience in Executive Search, we also support Strategy, Organisational Effectiveness, Governance, and Leadership work. Our Consulting Practice partners with our clients in organisational design to develop structures, roles, and competencies, inclusive of executive leadership positions and beyond. We work to ensure that Boards are set up for success because strong cohesion and collaboration between leaders and their boards are critical success factors, especially for organisations with new leaders. We also provide executive coaching, offering tailored, one-on-one support.