The Most Common Executive Hiring Mistake Made Today
How to Guarantee Subpar Performance inYour Hiring Process and he Levels of Learning Model

With unemployment levels higher than ever before in U.S history since the depression (ignore government figures that stop counting the unemployed after 18 months and all under-employed) many hiring managers focus on specific industry and domain experience. I guess that the idea is that a large pool of candidates means they can write a very detailed list of experiences and still get good candidates.  However, this tends to create a process which ignores the overall quality and ability of the best candidates in favor of a simple checklist of very specific, and sometimes simple, skills.  A person's broad experience, attitude, abilities, intelligence, work ethic and other factors are much more important by a factor of ten for most managers and senior executives. 

The truth is that a high quality manager or executive can and will learn a new skill, industry or area very quickly from the existing team, but a lower quality executive with specific domain experience may NEVER become a high quality "A Player"!  Which do you prefer, a high quality person, or a shorter learning curve in the first month or two?   Sure, there are positions where 10 years industry or domain experience will help because of experience, contacts, and industry specific idiosyncrasies. But, few industries are so complex that a few months will not get a quality person up to speed.  Anyone that says otherwise is either ignorant or just inflating their own experience and ego unless what they are talking about is an "art" (see later).

Specific domain expertise, knowledge, and contacts becomes much less important as you climb the corporate ladder, while overall experience, creativity, management skills, and other innate abilities become far more important.  At the CEO level, 90% of the job is literally generic across any industry; not industry specific. For a senior manager this might be 75% to 80%. Other members of the team should bring the deep and specific domain expertise needed. 

Often, the excuse that there are so many candidates available is used to demand an exact match to a long list of mostly unimportant things. Hiring executives create a long list of requirements only met by a very few people who are not necessarily the best candidates.  Executive recruiters often fall victim to this phenomenon when very specific, but unimportant things are requested by the client company.  They sometimes have little to no understanding of the weighting of certain skills, and take them all as “must haves” or equally important. You will know a good recruiter and HR person when they really parse the "must haves" from the "nice to haves" and eliminate all the easy to learn things.  Ideally anything that can be learned in a week should never even be in such a job posting. Job descriptions for managers and above that say "must have experience with Salesforce.com" or must know "XX" software package of any kind make me laugh. All I know about that company is that it does not know how to hire the best people at all and I would never want to work for them because they are doomed to mediocracy. They have a filter keeping all the best people out of their company and are not even aware of it. Yikes! 

This "list of skills" is far too simplistic an approach for such an important decision, and hence screens out most of the best candidates before the hiring manager even gets to see a resume, virtually an inferior result. Good consultants and recruiters know the client needs help in defining, not just solving the problem.>A large part of their value added is actually helping to frame the problem.  If the client knew all of this, they would not need a consultant in the first place, but they might need a contractor to perform a specific task they understand well already. I suppose that sometimes recruiters are reluctant to provide "negative feedback" on this due to fear of losing the contract, or the inability to weigh the relative importance of the factors because they do not know the business and/or have the experience in those areas. If your recruiter is a "yes-man" fire them, as they are not adding value to find the best people but just going through the motions to keep the contract or job.

 

Case in point: Many of the truly great turnarounds have been executed by executives brought in from other industries. These people came in with entirely fresh ideas and fewer preconceived notions and created change because they had no “baggage.”  Lou Gerstner at IBM did one of the most famous turnarounds of all time.  He came from the consumer and packaged goods industries (RJR Nabisco & American Express) to run the biggest technology and computer company in the world.  He knew almost nothing about technology. He was a marketing executive - and IBM needed that. His experience was a world away from IBM and the selection seemed to make little sense to many.  However, IBM’s challenge at the time had little to do with technology.  At the time IBM had $65 billion in sales and had many problems.  Lou was able to have an impact by applying his “generic” leadership, management and marketing experience, and by refocusing the organization on key areas.  Imagine if the Board of Directors at IBM had demanded an engineering degree for the job with experience in computers and running the companies.  Three things would happen as a result: 1) The candidate list would have been very small;  2) You would get someone in the industry who thought the same way as everyone else; and 3)  You would not get someone with the main skills IBM was lacking in strategy and marketing commodities (which computers were increasingly becoming at that point in time). This seems a little silly in hindsight, as many things do but one of the biggest technology companies in the world did not really need an executive with superior technology skills. They needed a leader, strategist and marketer. The needed an operator to reorganize and drive paradigm shifts in thinking, to expand services more than products (at this product company). 

Jack Welch started as a Chemical Engineer and many, many CEOs who came from within the industry, or even the company itself, failed miserably to create new shareholder value.  The best CEOs are going to shake things up a bit.  That means bring ideas and best practices from other industries. The best executives are going to ask GREAT questions that cause change and innovation, and won’t just do it the way everyone else does.  They may not even ask these questions if they grew up with the "way things are always done" and have learned to live with these things even though they may be narrow thinking or obsolete today. There is no better way to guarantee mediocrity than to not introduce new blood on a regular basis, and this means people from other industries, who will look at things differently, bring new ideas and provide a perspective that gets everyone to think some more.  This square peg in a square hole phenomenon is often sending away the very best executives in search in exchange for a little domain expertise that may actually be a liability!  Don't fall into this trap.

For example, why is it totally silly to demand a CEO who had a list of three or four very specific skills and experiences like:  "enterprise software", "middleware," or a "BS degree in Mechanical Engineering," or even experience with "radar systems"?  It is in fact completely ludicrous because these things are far too specific or granular, and will exclude the majority of high quality candidates every time.  They will add nothing to the ability to do that job really. This just makes it easy for recruiters and human resources people to do "keyword" searches and matching, but that is not really what you want to optimize in this critical hiring process that will have a huge impact on your business. Is it?  

The best people will be screened out, before even meeting the hiring authority almost every time. That hiring manager, not the recruiter or HR person understand the needed experience and skills better.  Those skills, that require decades to develop must overweight these things by a factor of 1,000 - literally! Even venture capitalists continue to make this crucial mistake and want to hire people only from within a given industry. Almost always this is suboptimal with a few exceptions.   The most important skills for a CEO are vision, management, overall business knowledge, creativity, communications, and leadership skills (90% or more of a CEO's job).  Everything else is far less important and usually easy to learn in the first month on the job - with fresh eyes - not the group think of an industry doing things the same way for decades. The very specific and smaller knowledge sets that other people should already have at the company might be 5% of the skills.  These are deep, technical skills that only experts who spent their entire career in that area can do well.  In other words, you will be predisposing your filtering process to reject most, if not all, superior candidates with the most important skills long before they get to the right person.  Highly specific (deep) skills are rarely important for a manager or executive. In fact good project managers can manage any project, irrespective of the underlying domain and industry, simply because they are using management skills, not industry skills.  

Keyword matching makes the search easier, for recruiters and resume screeners, but dooms the process to a short-list of highly specific candidates, instead of a broader list of high quality candidates.  In other words, when you do this, you are not really weighing the importance of each factor, but doing a binary (yes/no) exclusion on enormously less important criteria!  This is not an uncommon scenario in customer service operations all the time where the people running the process designed it for their convenience instead of for the convenience and best end result for the customer.  Like when they ask you for your customer number with the attitude that it is your responsibility to memorize it and not theirs, when they could ask for your phone number, which you likely do know.  The process is designed backwards. The fox is running the hen house. A layer of the bureaucracy has made its own job easy at the detriment of the key goal of the process. 

A good CEO has decades of leadership, management, people skills, strategic planning, finance, sales, operations and marketing experience. How much they know about a particular product, which is likely easy to learn in a day or two, is totally irrelevant to the selection process. Lots of people claim "my industry is different". This is almost always completely untrue. Do you have human beings in your industry that need to be motivated and managed? Do they act in their own best interests like in every other industry? Is there a mix of unskilled, skilled and professionals needed to deliver value to customers? The answers are always Yes. Yes. And Yes. 

Don't get me wrong, I think selling to the government and B2B versus the consumer markets is very important. This is macro level stuff that I would call art, not skills. These arts are developed over many years of experience and practice. I just do not believe, and never will, that the level of granularity I see today in management and executive searches and job postings (i.e. "middleware," a specific degree 15+ years ago, specific product experience, or a software language for a CTO even) adds value, so much as it distracts from the most important criteria in senior manager and executive selection.  After all "middleware," for example, is just a type of software and has the same technology/R & D, economic characteristics, sales process, and marketing challenges as any software product targeted at businesses and MIS types.  Recruiters who allow clients to do this are doing a major disservice to their clients by statistically excluding the best candidates every time!

I suggest that everyone reads the book Blink by Malcolm Gladwell. It explains the four levels of learning and is a very useful model in daily business life, if not life in general. Specifically it elaborates on the highest level of learning which takes at least five years to achieve through constant experience. I used the same figure of 10,000 hours (5 years full-time work) long before that book was published to reach a level in an art I would call "expert". Five years was an apprenticeship for many arts in the old days to become a blacksmith, glass blower or any one of hundreds of artisans. No coincidence there. This is now backed up by much recent neuroscience research which shows the brain actually physically rewires itself to do complex tasks (art) automatically over time. We sometimes call the result "intuition" or "in the zone" or "talent" but the reality is that a person sets up a neural network in their brain to do that particular task hundreds of times faster, automatically and better - essentially on subconscious autopilot - far better than anyone thinking consciously about the task could.  

Learning Level	What it Means
Unconscience Incompetence	You are ignorant in this area and do not know what you do not know
Conscious Incompetence	You have a sense of the knowledge and experience available in this area and understand you are not qualified to "do" it
Conscious Competence	You can struggle through getting something done but it will not ever approach the result of an expert doing it.
Unconscious Competence	Doing something automatically by reflex and intuition from many years of practice

Sometimes a broader view is needed to see the forest for the trees. 
When hiring a senior manager or executive the long view is all that matters. 
Don't hire for skills - think about the arts they need to perform, the raw intellect, drive and creativity.

That is what drives innovation and market leading companies and products.

This is one of hundreds of best practices we teach in our Six Systems For Higher Performance