29 October 2012
Leading at the Top: Science, Politics and Intuition in Executive Selection
There are probably, to my mind, three key points of continuity between what I am going to now try and open up for us here and what Liz has been doing.
If you look at Liz’s book, and I have the privilege of using it as part of one of the leadership modules which I do at Cass Business School, you will know that a focal point of her book is to differentiate leaders who are operating, or who have the capability to operate at the top, from what works in the middle, and that is a point of continuity in what I’m going to say. A second point of continuity is the limitations of behavioural and competency perspectives, and the third is power and politics. This is how the talk is going to go.
Relax – I am going to start with three stories, three selection stories. And then I am going to describe a research crisis, because I am going to try and persuade you that there is a crisis that you should be concerned about, about research into how people are picked for senior roles. I am then going to try and persuade you that there is a crisis in practice, in how people are chosen for senior roles – we should all be concerned. I am going to try and outline a new perspective, just to give a bit of flavour of a different way of thinking about this that could help us see a way forward. And lastly, I will just indicate what might be practical implications, some possibilities, how the world might be different, how we might act differently, if we were persuaded to go down this path. But I think three stories is enough to start with.
I think we should start with one of the most important stories that there is affecting the activity of the selecting of people for top jobs, and this bit can be quite quick because it is a story you already know so I do not need to tell you. It is known in every country in the world, by different names, and in English, it is the story of Cinderella, and as I go on to tell you two more stories, you can just be playing yourself the story of Cinderella in your mind, and asking yourself: what is the main relevance of the story of Cinderella to, let us say, the choosing of CEOs for major FTSR or Fortune 100 companies? Is it, for example, the idea that there is a perfect person out there who, when we find them, we will know and then everyone will live happily ever after? Is it that? Well, I think that has quite a big effect, but it is not the point I am going to make today, so just keep thinking about that one in the background of your mind.
The second story comes from my own professional work. It is from about four years ago, when I was hired – I had stopped being a headhunter then, and I was hired to be an independent advisor to a small national organisation that was recruiting a Chief Executive. This Chief Executive gets paid a salary of between £100,000 and £120,000 a year. It is in the not-for-profit sector and I want you to picture the scene of the first meeting – and the Board of this organisation is all Sir this and that, and Professor this and that, and, you know, KCMG, etc. I want you to picture the scene, with a long board table, with about fifteen board members sitting there, and it is the first meeting of the board with the headhunting firm they have chosen, at which the headhunting firm is going to start going through the list, the long list of candidates for this role.
In fact, we are right at the very beginning, with the very first candidate, and I have just called the person Xavier for anonymity, but alphabetically, this was the first candidate to be discussed, and then we get the very first comment in the boardroom from one of the non-execs, after Xavier’s name is read out, and it comes from someone I am going to call Curtis, and his opening words are: “I will resign if Xavier is appointed!” Imagine what happens in the boardroom, the pivoting of eyes and the “Oh, my goodness, what is going on here?!” and he goes on. We were apparently looking to see if it was a joke, but apparently it is not a joke. He explains, “Xavier is a disaster where he is! He has got everything wrong in the last few years! He has no idea about what good is! Simply ask anyone in the field!” This is what the director says. And then two other board members join in, in support, and say, “Yes, Xavier’s a good administrator, but got no imagination, no charisma – he is the opposite of the change that we need here,” and third board member says, “Yes, he hides behind pillars behind his spectacles,” and at this point, several board members laugh. And, in most universities, that would have been the end of Xavier’s candidacy, regardless of any competencies, CVs, anything at all, except, in this particular case, the Chairman of the Board decides to fight for Xavier and says he does not agree with this, and says, “Look, at this stage, we are just asking the headhunters to interview them – we are not taking a final decision yet,” so Xavier survives that very first hurdle.
In fact, if we then go on about two months, we get towards the end of the process, when in fact Xavier is running as the leading candidate is now quite likely to be appointed, and the meeting of the board comes, at which they are going to be asked to ratify the decision, and I am working quite closely with the Chair and so on.
Obviously, we all remember Curtis’ words, that he was going to resign, and obviously this could then be a public event, it could then be in the newspapers. Curtis does not come to the board meeting at which this is to be discussed, and there is the scene where the Chairman gets out his mobile phone and walks over to the side of the room and says, “Curtis, where are you?” and Curtis says to him, “Oh, I did not know the meeting was today,” and the Chairman says, “You bloody well did because I was standing beside you when you wrote it in your diary! We are about to appoint the CEO, and I have to tell you that Xavier is the leading candidate and you said you would resign if he was appointed, so I am really disappointed that you actually cannot be bothered to be here.” But now – and I had asked the Chairman to say this, he said, “Now, I really have to ask you, Curtis, on what basis did you make that comment? What is the evidence? Where have you known Xavier from because we need that information before we make the decision?” And this is the point at which it becomes apparent that Curtis has never met Xavier in his life, Curtis has never talked to Xavier in his life, Curtis has never worked with Xavier, either in the same organisation or across the table in another organisation – it is pure gossip, and that is how he thought fit to contribute as a board member to the choice of CEO.
So there is a selection story, and I call that kind of way of behaving - I owe an American psychologist friend of mine coined this phrase, which I love - “opinion karate” – “I will resign if Xavier is appointed!” Opinion karate usually comes from a couple of things coming together: one is the business person’s need to appear decisive, particularly if they have not got that “comfort in discomfort” streak that Liz was talking about – I have been presented with a very complex choice about CEO, I must have a view, this person will do, this person will not do. That quite often powers this way of behaving that I am going to call opinion karate. That is the second story.
Fortunately, human affairs did not stay in that rather terrible state. There are other ways of picking people for very senior roles, and for a third story, let us look at one of those. This is one of not many examples of actual selection of people for very senior roles that has been reported in an academic journal, and I draw on that account in my book, in chapter two.
This is a case where an organisation has discovered science, so if, before, we had the apes doing this, now, science has arrived in our midst, and so now let us look at a selection process done with science in mind.
So, the first task, Liz, some competencies, you will be glad to hear. A long list of competencies was developed, after an exhaustive process of identifying the best performers and then cross-checking with all sorts of other people, and then writing the paragraphs and re-writing the paragraphs.
And then we had the interviews. Now, in this case, they were interviewing the top 40, I think it was, senior execs in this organisation to pick for the top tier.
Here is how the process went. The candidates underwent tape-recorded interviews, which lasted between four and eight and a half hours, average four and a half hours. The interviews concentrated on the main challenges, achievements and learning of the candidates in their current role and earlier in their career. Transcripts of each interview were prepared, and each transcript was then independently blind-rated by five experts to give marks against the competencies that had been identified. And on we went from there: we had 360 feedback, and we had a ton of stuff coming out of our ears. I do not need to fill in all the details – you will get the idea. This, I would describe as a process, as a cathedral of a selection process, and it is a cathedral built to a particular god, and the god is science. The god is the idea that we can be objective about the person specification, we can be objective about measuring people’s behaviours, actions, successes, and then other stuff like their attitudes and expressed values against this, and this way, we will make the best choice.
We are going to come back to Cinderella very shortly, so I hope you have been thinking about what the relevance of Cinderella for this might be.
Just in case we do not get anything else out of my talk, I just want to take this opportunity, while talking about science, to correct what I call a modest typographical error in human understanding. You may know this famous motivational phrase: “Your attitude determines your altitude.” It is offered usually in juxtaposition against the idea that your aptitude determines your altitude. So this was something, it is not your abilities, your aptitude, that determines your altitude, it is your attitude – yeah?! So, American accent, attitude determines your altitude. There is a slight problem with this though.
Richard Boyatzis, since we are talking so much about competencies, is the key founder of the idea of competencies. In the beginning of his book “The Competent Manager”, it describes what motivated him to do all the research that led to the invention of competencies, and it was a study of a company, the Broadway manufacturing company in America, that looked at managers who joined ages ago and how they had got to different levels up the organisation, and it tried to look for any objectively, scientifically identifiable factor that differentiated the ones that had reached the highest positions from the ones that had languished lower, lower down, and it found only one. Now, psychologists and so forth in the room probably would guess that the factor that it found was intelligence or something like that, a measure of general intelligence, but sadly, that is not the right answer. The only objective, or objectively identifiable, factor that could be found was height. So, the slight correction which is needed to our common human understanding, it is in fact your altitude that determines your altitude.
There is more recent research studies – and I was just looking for a piece of paper on which I wrote something down, but maybe I can find it and bring it into the discussion, but let us just go, for example, to Romney/Obama. Romney and Obama are running pretty close, eh? Shall we say neck and neck…? Which one’s taller? I think Romney’s an inch taller than Obama as far as I know, but Obama is pretty tall. So, the point of that was to say science has got something to offer, science has got something to puncture or self-satisfied, complacent understanding there.
So I described opinion karate, which describes unreformed, intuitive decision-making about how to fill senior roles. I have described the building of scientific cathedrals as the next stage in human evolution. And the relevance for me of the Cinderella story is it is about the objectification. In Cinderella, there is the shoe. Now, that is what we construct when we build a person specification according to competencies, according to all modern good practice. We construct something which is meant to be objective, like a shoe, and then we go and try it on all the candidates, and we try and do it as objectively as possible, and when we find the fit, then we have got the right answer. In a way, you could say what the whole of this talk is about is: what are the problems that progress to this point in human thinking and evolution has got us into, and how might we move on beyond competencies, beyond science?
I am now going to turn to the research crisis. I just want to give you a few quotations to illustrate that the research crisis is that there has not been for ages, and is not now, any serious research going on into how people are selected at senior levels. And it is quite allowed, for this point, just bear with me if you think, well, I am not sure whether I care about that – I will try and address that later on, but just let us take the building blocks one at a time.
Neal Schmitt is a former President of the Society for Industrial & Organisational Psychology, probably the most important academic scientific group concerning themselves with these sorts of issues, and he wrote a book with a colleague in 1998, which was an overview of personnel selection, and in it, he comments on the practice that is called “individual assessment”, and that is the choosing of an individual at senior levels in the organisation. As he says there, “Because this selection practice is rarely, if ever, described in research reports we have constructed,” and this is in his book, he gives an idealised example. He is just noting, just taking for granted, as a matter of fact, that what goes on when people are appointed to very senior positions just is not researched, and significantly, like all academics do when they write this kind of book, it ends in the final chapter with a call of research priorities for the next decade, which is where you show off and hope that your underlings go off and do these research studies. But none of his research, their research priorities, for the subsequent decade or two, pointed to this area as anything to worry about. I mean, all we are talking about is how do we choose people for some of the most powerful roles in the world?
George Hollenbeck is an American psychologist who has both worked in industry and written academically, and he built up such a reputation that, when he retired in 2009, the Industrial & Organisational Psychology Journal gave him a valedictory article to write to address back to his profession at the point of his retirement, and he wrote an impassioned plea for people to realise that there is a crisis about thinking and research about senior selection. “Our field,” he said, meaning psychologists, “has stuck with our classical personnel selection model, seeking to correlate predictors with criteria, hoping for large samples. We do this even though it continues to disappoint us in terms of research, results or respect.” He carries on to what he is asking his colleagues to do. He says, “We need to begin to address the topic of researching senior selection,” he says, “some might say re-address it, but actually, look around, I cannot find any of it going on.”
In this country, one of the leading authorities on selection is Professor Clive Fletcher, and this is him writing in 2011, last year: “I have to conclude from a recent literature search that there is staggeringly little occupational psychology research, as opposed to opinions, on selection at these senior levels.” And then he gives what I think we might all be willing to accept are the obvious reasons for this: “There are probably many reasons for this, not least being the sensitivity and confidentiality which often surrounds senior appointments, and also because we are essentially dealing with a one-off exercise each time, with a small number of candidates being assessed for a single specific position.” I think we would all grant those are reasonable points he is making. But just stick for the moment – you know, you will be able to challenge me at the end, to say, how could we break out of that prism, but just stick for the moment with four decades, and right now, and with no prospect of it changing in the future, there is no research activity worth the name going on really into how we choose people for senior roles, and contrast that with change at junior and middle management levels and how selection is done in organisations now compared to 40 years ago.
The example I like to give is, let us think of the organisation in this country, or any country, that, say, controls the air traffic control system. If we went into that organisation today and we looked at air traffic controllers, we looked at the receptionist on the front desk, we looked at the management accountant putting the budgets together, we looked at any of those positions and we said, “What selection process did that person go through to be in that job compared with 40 years ago?” We are more or less guaranteed to find huge change. There would be job simulation exercises, could be psychometrics, there probably would not just be one simple interview – even for receptionists, there would not just be one simple interview.
But if we go to the boardroom of that organisation and say, “Anyone who is sitting in or near the boardroom of that organisation, what process did they go through to occupy the seats they are now holding?” In general, we will find very little difference from 40 years ago, and it will probably be a largely unstructured interview or number of interviews, coupled with some opinion karate.
So, you are entitled to say at that point, well, you might have persuaded me that there is not any research going on in this area, but I am not sure I care about that – why should we care about that if the way the activity is being done is, you know, jolly good? I mean, we are not that concerned about unemployment among academics, are we? No.
I want to say that I do not think the activity that is going on is any good. Now, there is a little bit of research, and one of the loveliest pieces is Rakesh Khurana, who is a Harvard Business School Professor. I very much recommend his book, “Searching for a Corporate Saviour: The Irrational Quest for Charismatic CEOs”. He did a study looking at the top of corporate America, and what happened – it was an ex-post study, asking people afterwards what happened – how CEOs were chosen at the very top of corporate America.
Just to give a tiny flavour. This is an environment in which, almost invariably, search firms are being used, and I was a headhunter for eighteen years and I would guess that, in the kinds of cases being talked about here, the search firms are being paid fees in excess of a million dollars for each assignment of this kind that they are doing. So you might think that, with search firms being paid a million dollars plus, that they might do two things: they might find candidates; and secondly, they might grill them very thoroughly. Nought out of two, if you thought that!
In his study, the search firms did not do any finding of the candidates. The clients did that for themselves, having paid over a million dollars. We can get into a discussion about why this might be so – it is not true in all bits of the search market, but this is what he found looking at the top of corporate America. And he found the research firms did practically no rigorous interrogation of the candidates. Why? Because this was a labour market where people had convinced themselves that you had to be already recognised as a star to be even in the frame, and so, if you are living in a world in which you think unless someone is already recognised to be a well-known star, a CEO somewhere else, with a glittering reputation, then they are not even allowed to be in the frame, then you could see how that might lead to a world in which not many pressing questions were asked of the candidates because they are, by definition, rising stars with glittering reputations. It is obviously very dangerous for organisations.
Anyway, you would have thought, well, goodness me, these company boards, they have spent a million dollars to hire a search firm, they decide to find their own candidates, they do not seem to be awake to the fact the search firms are not asking the candidates any hard questions, but at least of course the boards themselves will ask the candidates tough questions, will they not?! Imagine you were on the board of Barclays and you have just been through the sudden change of Chair and CEO, and you are appointing a CEO – we are littered with examples at the moment! You know, at least then the directors are going to be asking tough questions. Well, Khurana’s study, at this level, shows not at all. The directors go into such interviews as they have, showing downright obsequious behaviour – so I do not know whether that would be subservience or deference that they were showing there – and of course go in with little, if any, preparation, training or strategy for questioning the candidates.
Joseph Bower is another Professor at Harvard Business School, and he has served on boards as well as doing his academic stuff, and let us just suffice to say that he describes his typical experience of CEO appointment processes in corporate America as “blindfolded parking”.
My own experience, from eighteen years in executive search, is not – I will just be clear here: I am not saying that all senior appointments are made badly, but I am saying that, if you go into an organisation and you want to find some of the worst examples of how to appoint people or not appoint people that you want to find in the whole organisation, starting in or near the boardroom would be a good place to start, and to overall summarise, what I am saying is, then, here is an activity where how people are picked for positions at or near the boardroom is not in a happy state, and the activity which should help, research, there is no chance of it coming to the rescue – it is not looking at this area, it sees no chance of looking at this area, and it has got absolutely no ideas. I want to suggest that this is, moderately, a bit of a problem for us, or something that we should really try and want to see something done differently about.
My doctorate was about if there is any way that one could think about his differently and make a contribution that might just be one, one possible way of enabling us all to move forward from what I think is a rather depressing situation.
The only reason that someone like me can do a doctorate and end up offering something as a contribution to knowledge is not because I go away and put lots of towels on my head and come up with a deep thought. It is actually by the much simpler process of going and finding other well-tested bits of knowledge from somewhere else and seeing if some of them can transfer to the activity of selection. The activity of personnel selection is, if you look at its correlate research activity, if you look at who studies personnel selection, it is really quite a slim group of psychologists, some cognitive and behavioural psychologists, maybe some other people, a few sociologists occasionally, worried about diversity or something like that, but that is really it. Whereas, if we were to advance into the heartland of management, say, then there are all kinds of other rich academic disciplines, such as Political Science, such as Economics, such as Game Theory, that are there. So, in essence, what my research consisted of was realising that the intellectual underpinning of my eighteen years of a headhunter was really very thin, but the good news was that, therefore, I could go and wander in other bits of the intellectual forest and perhaps find something quite well-developed and tested there that might have a relevance here, and that is essentially what my doctorate was about.
The person who ended up being most influential in my work is a guy called Pierre Bourdieu, an anthropologist and sociologist, who, just to position him for you in your mind, Hubert Dreyfus, who is a philosopher, and Rabinow, who I think is a sociologist, this is them writing about Bourdieu in 1993. They said: “Pierre Bourdieu has developed one of the most analytically powerful and heuristically promising approaches to human reality,” small subject, eh, human reality, “on the current scene, as opposed to the other two plausible contenders, living contenders, Jurgen Habermas and Jacques Derrida, Bourdieu has continued and enriched the line of thought that runs from Durkheim and Weber, through Heidegger, to Merleau-Ponty and Foucault.
I take a postmodern thinker, who is very well-known in fields like sociology and anthropology, just the kind of thing that is not being read or studies by anyone looking at selection, and I try and work with his ideas in relation to this activity.
I am now just going to do a huge simplification. Bourdieu develops his own vocabulary for analysing human activity, and really, his core, the atom of understanding he tries to understand we might call the game, but I am not going to here try and introduce all his vocabulary. I am just going to try and give you my take. You could say to me, okay, you did the doctorate, now tell us in ordinary language, give us a clue how we might think differently if we followed you on that journey – and if you do want to follow the journey, then obviously that is what the book is about.
Here is a much simplified view. I think Bourdieu, as interpreted by me, invites us into a world in which all human activity can fruitfully be thought of as involving a continual contestation and struggle between three broad impulses, and I want to use the word “impulse” in a very, very broad way. I am going to call those impulses science, politics, and intuition. Science meaning not just white-coat lab science but the whole idea of trying to treat things as objective, the whole idea of trying to measure things, the whole idea of trying to find reproducible laws that will apply in context-free circumstances, so within your own jobs, that whole piece of management that is about target-setting and measuring and what gets measured gets done is one aspect of it, but just one. Politics, which, in this way of looking at things, is going to come out as always present everywhere and absolutely part of human life, and especially so at the top, just the struggle of all of us to have different resources, not just of power, but to have influence, to be heard. I am lucky enough to be standing here. You may or may not be listening to me, but some of you look like you are listening to me. I am lucky enough to have the microphone and be standing here and have 45 minutes of time – that is a resource. That is a resource that you struggle to get. It does not just drop out of the sky. There is a struggle going on all the time. And intuition, really one of the most interesting words in the whole of selection and which, this afternoon, there is not going to be time to unpack, but we will just scratch the surface a little bit.
What I am saying is, we move to an understanding of the world - which I am about to give you an illustration of in a minute, so you could see what I am trying to say – in which, all of human activity, we should always look to see these three things struggling together, and like stone, paper, scissors, in the child’s game, no one of them ever, ever can completely win.
Let me take an example, because that is just pretty obvious.
This is just a fairly straightforward example. You will remember, this summer, when soon after Bob Diamond went, Martin Taylor, the former CEO of Barclays, wrote in the FT this piece, which says maybe I should have sacked Bob Diamond ten years ago. I do not know how many of you read this piece when it came out at the time, but it basically goes like this. Martin Taylor says, “I was CEO of Barclays Group, I had appointed Bob Diamond to be CEO of Barclays Capital. At the time, expansion into Russia was a key dimension of our strategy.” And he recalls a meeting of the Bank’s Credit Committee, at which Barclays Capital came along and said, to enable our Russian expansion, we want the credit limits, the risks that we can incur going into Russia, set here, and according to Taylor’s account, the Committee deliberated, and Taylor himself, who was chairing the Committee, thought, and the Committee agreed with Taylor, surprise-surprise, to set the credit limits at about half what Barclays Capital had asked for. That decision was taken and off everyone went. Then the story moves on, to two years later, when Taylor’s in Canada, and he gets a phone call from his CFO, who says, bad news, Martin you know, some Russian has gone belly-up or whatever it is, but, you know, the scenario we feared is happening, the Russian assets are potentially going to be severely impaired. Taylor says, “Oh well, that is a shame, but there we go – business is about risk, but at least we know that we capped the risk at that amount that we set in the Committee.” And the CFO says, unfortunately not, Martin – our clever people in Barclays Capital found ways to book these exposures as American and Swiss and other things, by using other corporate intermediaries, so we reckon our actual exposure to Russia is quite a lot more than the Committee authorised.”
So, there is a happy tale of ordinary corporate life, and I just want to illustrate, within that, how I am trying to use the words science, politics and intuition. By science, I mean that impulse to quantify. So the whole idea of setting a numeric credit limit, and all the apparatus that underpins it, is an absolutely dominant feature of organisational management life today. We cannot imagine what it would be like without it, but that is part of what I mean by the scientific impulse: let us quantify it, let us try and objectively define it, let us grab it and say it cannot be this big no longer.
By intuition, I mean, let us look at that judgement which said Barclays Capital are asking for this much, we will give them half that. I think this is characteristic of many of the most important business decisions, which is they are decisions that someone may describe as being made on gut-feel. They are decisions where, in truth, the numbers in the spreadsheet could be made to justify any one of a wide range of points, and yet, a decision has to be made to stand here rather than there. When I am using the word “intuition”, I am using it to describe a kind of decision-making that is going on in our most expert part of ourselves, far out of the reach of our conscious minds. The point about intuitions is we cannot give coherent explanations for why we are thinking what we are thinking. I am absolutely not saying that all intuitions are right. Our intuitions are very often wrong, and our intuitions about people are especially often wrong, but our deepest and trickiest judgements come from places where we cannot give a full account of why we think what we think, and this is part of life, and that is part of what I mean by the role of intuition in that story.
Then politics is a factor. Well, of course, so the Committee had a little struggle, Taylor prevailed. He probably realised that he is always going to prevail in the Committee, but that was not the end of the game, was it, because there were lots of other things that people could do to side-step, to actually move power around, beyond where it was officially supposed to be.
So that was just to illustrate how I am trying to use those words, science, politics and intuition.
What I am offering then is the idea that, if we look at a way of thinking about the world, there has been fairly thoroughly tested in sociology and anthropology and philosophy, and which would lead us to say that, actually, any time anyone gives us an account of human affairs, we should look for these three things and see if we can see them in the account, and see if we can see them struggling together.
In your job, maybe you have got a change management project or something to do, this way of looking at the world would say, well, look at what you are doing, look at what your bosses are asking you to do, look at the plans you are making – what account do your plans take, here is the scientific piece, here is the measurable piece, the defined piece, the nice rational, clean piece – that is the bit on which I guarantee you will have a lot of stuff on your computer already.
What is the politics of all of this you are doing? Now this is something which some people think about, and some people do not think about. It bears with a lot of thinking about, and it is why we are here this afternoon.
Intuition opens up perhaps another whole area, which is, that can be in lots of ways. So, for example, what intuitions, what expertises are you yourself bringing? What are the most difficult judgements that you are going to try and persuade colleagues, on the basis of your experience, to go somewhere for reasons that you cannot fully explain? Also, when you are carrying out your change project, and you encounter those people, who are often called forces of resistance in change management textbooks, and who say to you, “But it is really important that we do things a certain way,” and you say, “Well, why is it important and where is the evidence?” and they say, “Well, I cannot really explain that to you,” do you have a space in your mind, one possibility is that I have uncovered a useless practice which has no evidential basis, which should just stop, but do you have another possibility in your mind that actually you might be pushing up against an absolutely profound intuition, a skilled judgement, which, like all the most important judgements we make, is largely inarticulate? And what are you doing? You push against it.
Now, if we look at this, we can understand better why that problem I was describing of senior selection. Remember, what I described was, I said think of that air traffic control organisation. I mean, human resource management, competencies, and a whole lot of other stuff, have done a whole lot of good, mostly, I would say, mostly good, with qualifications as Liz was saying, at junior and middle levels of organisations, to improve selection processes, and all of that improvement has basically come from the science space. There has been attempts to study, objectify, measure, ask where the evidence is, all of those things. But if you do HR training to be a selector, so you will get very big on that, you will be trained to be anti-intuition, because you will go through a training process that persuades you that you need to disregard your own intuitions about people, and this is – let me be quite clear what I am saying. Most of our intuitions about people are severely wrong, so they really do need challenging, but, if you go through the selection processes required to be a good interviewer in most organisations, you go through a process which is very pro-science, deeply anti-intuition, and in complete denial about politics. I have yet to see a book on recruitment which says anything at all, let alone anything useful, about politics, and yet picking people for roles is an intrinsically deeply political activity, certainly at senior levels, and even not at senior levels.
I mean, just a classic example is, let us say you are doing that difficult change management project, and you have got to have, say, the Finance person who is going to be going through and running the numbers and just checking and checking all the time, and you think I really need someone in there I can trust, right?! And you may go through a dance of a selection process, because that is what your corporation requires, where you list the competences and you tick the boxes, but so often, what is really going on, if there is someone who you think you can trust, and there are some other candidates, is you are desperately trying to find a way to make the rational data appear that will allow you to appoint the person you can trust.
Now, a hell of a lot of things go wrong in a world in which people just appoint people who they trust, who they therefore already know, but by creating a framework for how we should do selection which is in complete denial about the political aspect of selection, we create a lot of problems for ourselves. We create I think part of the situation in which, if you were a Chairman of a Board, and you were wanting to appoint a CEO today, in a good way, the only suggestions that you have got about how you should appoint a CEO in a good way would be, do you want to go down the road of that cathedral – are we going to interview people for eight and a half hours and have five people marking their efforts, or, if not, what are we going to do? And you will very quickly just be given a bunch of stuff that comes from the HR Department, that is very well meant, but it is not suited to political roles, it is deeply anti-intuition, and that is why it is fundamentally rejected by the top people around boards when they are making senior appointments. You see, when you have top people around boards doing anything, but let us say making senior appointments, of this we can be confident: they really think they are expert at doing some of the things that they do. They may not be. I said they really think they are expert at doing some of the things that they do. You do not get to sit in these boardrooms unless you think that. And so, when an expert does something, they repeatedly use intuitive judgements. That is what being an expert involves. I go into this in detail in the book. So, therefore, if some HR person comes along and says, “Well, this is how you should select your CEO – I want you to write down your questions, I want you to ask the same questions of all the candidates, and I want the questions to all sound quite bland and whatever it is,” and, basically, the people in the boardroom just go, “No, I cannot be doing this – this has got to be dumbing-down. I am an expert at picking people, am I not?”
Are we doomed to just live in this world of double failure, with crap ways of choosing people for top roles and no chance of research coming along to suggest any other ideas?
Well, the argument I develop in the book does suggest – it does not provide a new right way, but it does suggest some things which would be changes that we could make, and they are in some of the following areas.
We would change how we use our time in the selection process perhaps a bit. I will just give you a very simple example – I will take this one from the public sector because it makes a nice graphic picture. In the public sector, when they pick people for top jobs, like Governor of the Bank of England or something like that, they typically try and get a panel together, and then they try and get all the candidates to come and be interviewed on the same day. Having been a headhunter for eighteen years, I know that a very common thing that happens is they will try and fit six candidates in, and they will leave themselves very little time to discuss at the end, which increases the opinion karate problem, and then someone on the committee has got to go and catch a train or a plane and they have this very cursory discussion at the end, having crammed in a lot of candidates. It makes sense if you think you are in the Cinderella story. If you think you have got a shoe and you are putting it on people’s feet, it makes sense to say, well, if we have got a marginal error of time, let us travel to another bit of the forest and meet another candidate and try the shoe on their feet because we do not really need much time over that. If we followed this path, we might see fewer candidates and have a much more discursive process about making the decision.
I will just flag up that I think that the whole idea of the person specification needs strengthening with an idea of confronting uncertainty, an idea that we might borrow from investment of risk appetite.
All this is about facing up to the fact that, when we choose people to fill any role, including any senior role, we are facing far more uncertainty than we allow ourselves normally to believe, and we should get real about that and get honest about that, and if we do that, then we start to realise that, well, we do not just need a person specification saying what would be ideal, we also need a sense of our risk appetite around that, about how big a problem is it, if we stray away from the ideal.I will just finish with the research. Are we stuck, with no hope of this activity being better? No, actually, I want to leave you on a very optimistic note. I mean, it is not very often that someone can stand up in front of you and say – you are entitled to laugh, but I am going to say, there is something quite doable that would mean that the chances would be good that, in twenty or thirty years’ time, we would be selecting leaders in better ways across all walks of life. All we have to do is to get out of the research prison, but the only reason we are in the research prison is because the only kind of researchers thinking about selection are scientists, and scientists can only think about the white-coat stuff and statistical studies and all that type of thing, but there are all these other academic disciplines – so my doctorate was based on narrative material, and it would be quite easy to get narrative material about even very sensitive senior selection situations. I mean, for example, one of the uses of headhunters, this very low form of life which I have been for some time, but, you know, one of the uses of headhunters is they have lots of clients, so it is quite easy for a headhunter to write an anonymous narrative about stuff that really happened, because you cannot quickly work out, you know, who the client is. We could start collecting stories, true stories, like Curtis and Xavier, which is a true story. We could start collecting true stories about what really happens when people are chosen for senior roles, and all we have to do is collect them for three or four years, and then the researchers will start coming from different fields to say, “Oh, we could do things with this…” and then, ten years further on, we will start to have some new ideas, and twenty years further on, we will actually probably, because we have been doing nothing to improve at all for the last 40 years, we will probably be starting to choose these better, and that might be leading to a better world.
© Douglas Board 2012