CEO and business need to work more closely with HR function to ensure senior executives are onboarded successfully

Senior executives are being poorly recruited and entered into UK organisations, often as a result of the business failing to work more closely with the HR function, according to new research out today (4 October 2012) from executive search firm Harvey Nash. More than one in three new executives (39 per cent) find their start so bad they considered walking away from the organisation within the first three months. One in five executives feel they do not fit in well with the business once on board, as a result of incomplete and inaccurate information about the role and organisation at the recruitment stage.

The research, ‘Onboard and upwards: How an executive’s first 90 days make or break the ones that follow’, was conducted among over 280 senior executives from FTSE 350 and large non-FTSE companies in the UK, and some NHS and public sector organisations, who had all joined their organisation within the last year. It also found that organisations are not using the insights from any psychometric and structured assessments completed during recruitment to set executives up for success in their new roles or help them integrate well with the business.

Lucy McGee, Director of Leadership Services at Harvey Nash, comments: “There’s a cost to an organisation for every day a senior executive role remains inadequately filled, so managing their entry into the organisation gives a high return. We found that the quality of the first 90 days for an executive, and how well they are introduced into the organisation, are crucial to their long-term success and productivity in the business. We also found that while executives often complete formal assessment or psychometric testing, this valuable data is rarely leveraged to give them a strong start in their new role, and many never even see the results of this. While the HR function sees how useful this key information can be, the rest of the business is failing to benefit from its full potential.”

Executives say they could be on average 50 per cent more productive if their start in the business had been better organised, with executives who had a positive start evaluating themselves as significantly more effective. This effect is further amplified by lost productivity cascading through the team the executive is leading, so the actual cost of failing to onboard an executive in a way that delivers a good return on a company’s investment in them runs into tens of thousands.

The impact on a poor start is costly; three quarters (73 per cent) are already saying that they plan to leave within three years and over a third (37 per cent) plan to stay for less than a year or are already seeking a new position elsewhere. Only a quarter (24 per cent) believed their induction into the business was very useful and only half (49 per cent) feel they can raise difficult issues with their Chief Executive or immediate boss.

Executives frequently lack a means of measuring their own performance and contribution well into their tenure: just under half (46 per cent) say their key performance indicators are not set and agreed within their first month, and 32 per cent complete their first 90 days with goals still not agreed, despite most having a great deal of contact with their direct line manager.

Part of this problem may be a misrepresentation of both the business and the role in the ‘wooing process’ that is executive selection; a quarter of executives felt the organisation was not accurately portrayed in the recruitment and interview process, and just one in five (17 per cent) felt the organisation lived up to expectations. A third (33 per cent) said their role had changed significantly from the one outlined at the interview stage. Those who said it had changed significantly were also more likely to consider quitting in their first 90 days. Likewise, for those executives who reported the role or business was not accurately portrayed during recruitment, their interest in the business also decreased.

Some 41 per cent of executives have only one or two formal interviews, plus perhaps another informal chat, which suggests that some organisations are making important hiring decisions without the necessary rigour.

Lucy McGee continues: “The HR directors we heard from in the research were not happy about the way the recruitment and onboarding process is handled for the most important and costly roles in the organisation. HR’s role as custodians of an organisation’s mission, vision and values is to work with their colleagues on the senior team to create an employee value proposition that everyone from the CEO downward feels comfortable with and can communicate effectively and consistently. Where HR leaders are successful in supporting their executive colleagues, it’s because they help new executives ‘acclimatise’ in the organisation, and support them building new relationships and networks within the business, providing wise counsel, as well as facilitating the early agreement of KPIs so they know how they will be measured.”