Senior level terminations have been on the rise. A recent Korn/Ferry international survey found that 48 percent of 262 participants were terminated from senior level positions within their first year on the job. Some CEO terminations seem to be tied to business and financial performance, such as Groupon’s recent firing of CEO, Andrew Mason. However in consideration for retention strategies and the toll that these terminations take on employee morale, there is an urgent need for companies and leaders to look at the overall picture, rather than terminating.
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CEO’s worried about falling in those pot-holes may want to investigate the deeper issue. And businesses can do their share of preventative measures from a hiring and development stand point. Below are some tips for companies as well as senior level executives to look at before terminating.
Digging Deeper Tips for Companies:
- Consider the CEO’s leadership skills. Back in 2006, reports pointed to lack of leadership skills as a top cause of CEO turnover. The same is true in today’s surveys and reports. It is imperative that the search process includes success indicators, inclusive of talent connectors linked to EI that can inspire engagement and intrinsic motivation.
- Utilize executive coaching for growth not only for discipline. Bill Gaines of Regis Consumer Products is an example of the importance of strong leadership skills for CEOs according to “Increase your Chances of Survival as a CEO” by David Brookmire. Brookmire points out that Gaines was known for his many skills and reliability, but lacked inspirational leadership skills. However, after undergoing executive coaching to attain stronger leadership skills, he has succeeded in his role.
- Create markers for strengthening technological skills within your talent. One common correlation to the high number of CEO turnover rates has been measured to be the leader’s inability to keep up with technology. It is a lot. But it is the future. When CEO’s don’t understand the growth of social media and the effects of cloud computing on sales, and growth, they leave a gap for competition.
- Provide immediate and frequent feedback. CEOs receive raises and awards, and then shortly later are asked to leave. Do not send mixed signals. Address issues honestly, gently and in a timely manner. This offers the best chances of success for everyone.
- Are CEO’s being given enough time to have impact? Statistics show 40 percent of CEOs fail within their first 18 months. One might ask, given only the human factor of familiarity with key players and customs, if they have been given adequate time to succeed. Adjusting to a new position involves learning loads of new information and developing many new habits, especially given the high variance in leadership style, from one leader to another.
- Is the organization receptive to new ideas? Could the existing structure of the company be the issue, not the new CEO? The trend in terminations and CEO conflict with boards etc. as a high leading cause for termination, may suggest that companies are not be effectively utilizing their new CEO.
Digging Deeper Tips for Senior Executives:
- Don’t rush into an opportunity without detailed analysis of the position, the organization, and your values. Research company history and assess the current situation of the business.
- Start developing success plans for the job and company before even stepping into an interview. The Korn/Ferry International survey found that organizational restructuring and personal conflict with upper management were leading causes of termination among their respondents. If the company you may be joining is headed for a restructure, can you prevent that with your success plan? Be aware that the “restructures” often involve new management.
- Be honest with yourself about your fit and those you encounter at the company. If you sense something is off from the start, you may want to think harder about the opportunity. As mentioned above, management conflicts about direction are a leading cause of termination. Though you are confident your ideas will work, are these ideas well received?
- If you’ve decided to accept an upper management position or are already a CEO, tackle your emotional intelligence and leadership skills above all else. As a leading cause of terminations, these skills are important for CEOs to develop in maneuvering the organization politics as well as long-term job satisfaction.
- As a potential CEO or current CEO, it is important to stay on top of technology and global business trends. Hopefully your company can provide this training. If not, sign up for a class or regularly monitor news and blogs for updates.
Termination trends are like a fad. Organizations try it out and are sure to reverse it in the near future, as they learn, one person is seldom the sole decision-maker. Utilize the advice and aim for success.
