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Finding quality leadership talent is among the top and most critical challenges that organizations face these days. Having a strong company leadership in place and ensuring that there is a talent pool ready to take up key roles in the future are significant factors in determining the sustained success and profitability of an organization. For attaining this, organizations need to have a well-structured leadership hiring process in place.
Organizations differ in the way they carry out leadership hiring. The leadership hiring method and process of an organization is dependent on certain factors:
1. Job role type determines what skills will be assessed during the hiring process
Each leadership position is unique in its skill requirement. While some roles may require an assessment of the candidate’s behavioral skills, others may require an assessment of their logical thinking or analytical skills. Depending on the job’s skill- set demand, a company might choose to hire for a position by holding multiple face-to-face interview rounds or go for more rigorous testing of skills by asking the candidate to execute a few job-related tasks to assess their skills in a more practical manner.
2. Job level determines management participation in the hiring process
While managerial level hiring may require the involvement of the HR and business unit head, hiring senior leaders will include CXO’s input during the decision making process.
3. Available resources determine the usage of hiring tools
Hiring leaders is a cost-intensive process. But that is not the only resource needed to effectively carry out leadership hiring. Access to leadership competency frameworks and scientific talent assessment tools significantly impact a company’s ability to hire the right leader. Depending upon how much budgetary allocation and awareness about hiring tools an organization has, their hiring process may differ. While big budgets can allow organizations to use the most advanced talent assessment tools such as coding simulators, assessment centers, and hackathons; lower budget allocation will leave organizations with the option of assessing candidates via face-to-face interviews and in-person exercises only.
4. Time at hand or Urgency of hiring for completing the hiring process determines resource allocation, hiring tool usage and number of hiring rounds
The time-on-hand that the organization has for completing the leadership hiring process depends on how urgent the requirement is. If an organization wants a leader on an immediate basis, they may decide to cut short the hiring process by adopting methods that can help fasten it or put in more resources. On the other hand, if an organization has no urgent requirement for a leader, they may decide to use resources more judiciously and adopt more evasive assessment methods that are more thorough and time taking.
Despite the different organizational leadership requirements, there are certain practices that can help them ascertain to a great extent that their leadership hiring process objective is met. To identify the best practices that can increase an organization’s chances of finding the right leadership talent, we asked our survey respondents and leaders what they perceived as their leadership success rate. We then correlated their responses with their leadership hiring practices to find out what methods are likely to increase the chances of hiring the right leadership talent for any organization. Let’s have a look at the leadership hiring best practices that organizations having a successful leadership team follow:
Organizations that have an accurate and regularly updated leadership competency framework, based on which they carry out their leadership hiring, are able to achieve a significantly higher leadership success rate than organizations that do not have a ready leadership competency framework.
Leadership success rate and competency framework adoption rate is highly positively correlated. Companies that base their leadership hiring and development methodology on competency frameworks have a much higher perceived leadership success rate.
The benefits of competency-based hiring are multi-fold. Leadership competency framework provides organizations with a blueprint of skills their leaders must have to succeed in any leadership role. Also, these organizations have a better understanding of the talent assessment tools to use during hiring, based on the skills they want to assess. Having a competency framework also helps in structuring the hiring process, bringing uniformity and efficiency, and removing biases from the hiring process. All this leads to a more holistic and accurate talent assessment which enables the organization to identify the right leadership talent more effectively.
Organizations that utilize some form of scientifically validated talent assessment tools for leadership hiring processes are more likely to succeed than when only traditional methods of recruitment are used.
Leadership success rate and scientifically validated talent assessment tools adoption rate during leadership hiring is highly positively correlated. As discussed before, the accuracy with which modern talent assessment tools can measure the skill proficiency level of talent significantly improves the chances of identifying the right candidate for any job role, including leadership roles. Our conversation with leadership hiring experts further confirmed our study and analysis.
Organizations having a leadership hiring lead time of less than a month to have a perceived leadership success rate of 80%, whereas organizations that take 3- 6 months to hiring leaders have a perceived leadership success rate of 47%. In general, the lesser is the leadership hiring time the more is the success rate of perceived leadership.
Organizations that have a shorter time to hire can significantly reduce their candidate back out rate, thereby preventing loss of quality talent during the hiring process. In the present time and age, there is a significant shortage of leadership talent, and 89% of the talent that organizations would ideally like to hire are already employed. Increasing the chances of successfully recruiting the right leadership talent requires making the hiring process more concise, streamlined, structured, and candidate friendly.
Our study shows that the use of scientific talent assessment tools and competency frameworks is highly negatively correlated with time to hire. What this means is that- higher the usage of talent assessment tools and competency frameworks during the leadership hiring process, shorter will be the time to hire.
The use of a competency framework enables organizations to become better equipped to select the right talent assessment tools that enable them to assess, identify, and hire the right talent. It also enables the creation of a structured hiring process which in turn makes the hiring process shorter and more efficient.
Use of Leadership Competency Framework and Talent Assessment Tools Makes Hiring Process Shorter
Too often organizations use tools for leadership hiring that they don’t understand, or which provides questionable results. Before even getting to the point of an assessment, the people involved in the hiring process need to be clear about what skills they want to assess and the kind of leader they want to hire. Existing business leaders are the best judge of competencies required to succeed in each leadership role. A lot of times mismatch between the kind of talent that the organization wants and the kind of talent they end up with occurs when HRs operate independently of the rest of the business. High-performing businesses have comprehensive leadership hiring processes that are championed by the CEO and business leaders to hire leaders having the right skill-set, leadership style, and cultural alignment.
HR should support the leadership hiring effort, but not completely own it. When strong leaders are involved in the leadership hiring process, organizations can make better people decisions.
According to Deloitte, organizations with strong leaders are 2.3x more likely to financially outperform peers. Sadly, most organizations do not have strong leadership and this problem is only going to magnify in the future. 84% of organizations globally anticipate a shortfall in leaders in the next 3 years and 86% organizations rate leadership as an urgent issue. Even organizations that have strong leadership presently cannot be certain if they will continue to have it in the future.
It is important to adopt the best-in-class leadership hiring practices that significantly enhances your chance of identifying the right talent accurately, followed by providing them with a delightful hiring process experience.
There are a couple of things that organizations can do to increase their chances of successfully hiring the right leadership talent. We have listed them down for you:
You may also like to read: Leadership Hiring Challenges: Why Organizations Fail
Originally published May 31 2019, Updated June 18 2020