The Annals Of - INSEAD

We begin Part One with three perspectives on recruitment, a core function of HRmanagement. Recruitment refers to the overall process of attracting, selecting andappointing suitable candidates for positions (either permanent or temporary) withinan organisation. Executive search can drive change and shape the culture oforganisations. The fit between individuals and their work environment is crucial forjob satisfaction, motivation and employment outcome. Selecting the right executivefrom the onset, and onboarding or socialising them into the organisational fabric area challenge for many companies, often leading to low success rates. Failedonboarding can be very costly with both tangible and hidden costs. Hiring the rightcandidate has never been more important as a company’s ability to find and recruitskilled talent is going to determine how successful they are in meeting theirbusiness growth objectives.Nicole Scherf, an executive coach with C-level head hunting experience, exploresthe use and limitations of Expert Intuition (which relies on “gut instinct” and heuristicdecision-making in situations in which there is no rational solution or no time forfinding alternative solutions) for C-level recruiting processes. She provides insightsinto how this process works, through analysing and reflecting on her ownexperience on a nine month-long process to hire a new Country Head for aninternational consultancy firm. Taking multiple perspectives, she uncovers bothconscious and unconscious group dynamics: mainly that beyond good intentions,high aspirations and commitment, Search Committees too often consciously orunconsciously turn a collective blind eye towards their manipulative power as agroup, hidden individual agendas as well as potential financial and reputationalrisks. In response, she proposes the practice of Adaptive Leadership as acomplimentary process to minimise blind spots and to actively manage inner- andintra group conflicts that impact the quality of complex decision-making processes inC-level recruiting.Gary Teo, Director of IT services at a university campus in Singapore, looks at theimportance of recruiting the right employee with the correct person-job-organisationfit, from the very beginning of the process. He proposes an “organisation anchors”questionnaire which was derived from Edgar Schein’s career anchor theory. Usingboth individual career and organisation anchor questionnaires, recruiters will beable to use Gary’s framework to assess the suitability of potential candidates. Hisfindings show what when there is greater alignment or match between individualcareer and organisational anchors, the candidate will more likely perform better andstay on with the organisation for a longer period of time.11

Bill Lu, a global senior HR executive, explores the power of storytelling in creatingshared value and emotional connection and how it may be used in an organisation’semployment marketing process to attract desired job seekers. As job seekers’ selfidentity is the main motivation driver when it comes to selecting an organisation towork for, organisations may enhance their appeal to desired job seekers by tailoringcompelling stories which evoke their ideal self in career. Organisations need tounderstand what drives desired job seekers’ selection of organisations to work forso that they can create stories that resonate with their perceptions of their idealemployers. Lu provides a number of practical recommendations for howorganisations can enhance their employment marketing strategy.12

Why do Executive Recruiting Processes GoWrong? The Impact of Group Dynamics onSearch CommitteesNICOLE SCHERFThe Starting PointExpert Intuition is the declared ‘muse’ for CEO decision-making and – surprising ornot – also plays a pivotal role in C-level recruiting processes. My experience ofbeing on the dancefloor as part of a Corporate Search Committee provided deepinsight into how ‘it’ works. Viewed from the balcony, across borders and businesses,as well as from a single case setting’s perspective, I explore, in this article, why Clevel executive recruiting processes often go wrong or produce suboptimaloutcomes.Idea in BriefThere is a paradox in decision-making of Expert Intuition being both the solutionand the problem. In this study, I look into a C-level recruiting process and witnesshow intuitively managed inner-group dynamics impact a nine month-long decisionmaking process to hire a new Country Head for an international consultancy firm. Inthe aftermath, Board Members considered and officially declared the outcome amajor success.Under the surface, however, one of the findings is that beyond good intentions, highaspirations and commitment, C-level task groups such as a Search Committee toooften consciously or unconsciously turn a collective blind eye towards theirmanipulative power as a group, hidden individual agendas as well as potentialfinancial and reputational risks.Idea in PracticeThe underlying core issue of why C-level recruiting processes go wrong is woveninto the Board Room fabric. Tacit Board Room disconnect and lack of accessibilityare indicators for deeper system-inherent issues. A Search Committee is weak fromthe outset when such conflicts and unconscious group phenomena areunaddressed. In the example I provide, dysfunctional group symptoms in theinitiation phase, such as patterns of conflict avoidance and decision procrastinationas well as lack of commonly agreed maintenance of territorial, task, role and rolerelationship boundaries, lead me to the conclusion that Expert Intuition alone is notenough to deal with the complexity of group dynamics in such a context.In response, I explored how the practice of Adaptive Leadership could haveminimised blind spots and be used to actively manage inner- and intra-group13

conflicts that impact the quality of complex decision-making processes such as Clevel recruiting. The Adaptive Leadership practice consists of a Three Phase Modeland an Executive Tool-Kit including Six Behavioural Principles that can help aSearch Committee to balance the requirements of co-operation and structure in theservice of the organisation, the external or internal candidate and the searchcommittee itself.14

Introduction“Who are you then?”“I am part of that power which eternally wills evil and eternally works good.”— Faust, Johann Wolfgang von GoetheWhat the devil in Goethe’s Faust talks about is this powerful dark side residing in allof us, working so efficiently and effortlessly in silence, often against our goodintentions and yet mostly below our conscious radar. This power is always presentand the inner conflict between our ‘bright’ and ‘dark’ sides is part of the humancondition. It is our own choice to actively develop a practice of reflection-in-action todeal with our inner conflicts before they manifest themselves in outer reality, or not.Once we become members of a group though, it becomes less our individualchoice, but more a collective action on how we deal with inner-group conflicts. Bion(1961) noted that “when individuals become members of a group, behaviourchanges and a collective identity emerges: a task group becomes a new ‘Gestalt’ inwhich the group is focal and the individual members become the background.Membership becomes an exciting but ambiguous experience, one that invitesindividual members to join in the task at hand and also triggers their fantasies andprojections about belonging and their conflicts about leadership and authority” 1.Thus, in Bion’s view, a group setting has a catalyst effect, with its own power andfunction. Based on individual experiences from the past as well as individualfantasies about the future, a group with its own emerging collective identity cantransform and enhance positively or negatively individual behaviour. Within thisarena, inner group conflicts and tensions lead to different kinds of intra-groupdynamic processes and defence reactions.As a group, Search Committee Members often do have quite a good sense ofcohesion as they are accustomed to working together in different roles, differentconstellations or hierarchies outside the temporary task group setting. However,conflict resolution capabilities in Search Committees are more the exception thanthe rule due to lack of trust and unequal distribution of power – especially when aCEO is involved. As a consequence, there is often a lower level of true commitment,accountability, process quality, performance and final result achievement.Communication is often top-down, and levels of cooperation and competition as wellas patterns of leadership vary depending largely on the CEO. Usually, the goodintentions of Committee Members are unfortunately auto-sabotaged during theprocess due to insufficient internal and external controls to maintain the boundarybetween stated intentions and conscious and unconscious hidden agendas.Expert Intuition and its role in senior executive recruitingDuring often strenuous decision-making processes, Search Committee Memberspredominantly rely on their Individual and Group ‘Expert Intuition’, which is theirroutine, low-energy functioning mode 2 . Heuristic decision-making is the ‘key15

method’ applied when making decisions in complex situations in which there is norational solution or no time for finding alternative rational solutions 3.Yet there is an inherent paradox in Expert Intuition being both the solution and theproblem. Expert Intuition could also be defined as ‘mere perception’, as theunderlying assumptions are usually based on past individual, or in the case ofSearch Committees, past collective experiences as well as fantasies about thefuture. Throughout months-long senior executive recruiting processes, there isneither ‘high complexity’ or a lack of ‘time for rational solutions’. Instead, whatresearch in the course of this study suggests is that there is often a certain amountof Board Room resistance.Thus, the challenges lie in:1. Identifying and addressing Board Room resistance to change their usualoperating mode2. Overcoming resistance and letting go of the Search Committee Membersindividual and collectively-perceived ‘creative’ space for gaining processeffectivity and higher quality in their decision-making.The Adaptive Leadership approach as a complementary concept to ExpertIntuitionBuilt upon the idea that it takes both Expert Intuition and a deliberate practice tomanage group dynamics and genuine human behavioural patterns, the practice ofAdaptive Leadership by Heifetz, Grashow and Linsky (2009) is a strategicframework which provides guidelines and principles to manage iterative processessuch as the recruitment process4.Adaptive Leadership involves three key activities:1. Observing events and patterns around you2. Interpreting what you are observing and developing multiple hypothesesabout what is really going on; and3. Designing interventions based on the observations and interactions toaddress the adaptive challenge you have identified.Each of these activities builds on the ones preceding it; and the process is iterative:observations, interpretations, and interventions are repeatedly refined.Observe: Two people observing the same event or situation see different things,depending on their previous experiences and unique perspectives. Observing is ahighly subjective activity. To make it as objective as possible must therefore be theultimate goal. One strategy is the mental ‘balcony’, which allows the Observer to‘get off the dance floor’, gain distance, observe him-/herself ‘in action’ and seepatterns in what is happening.16

Interpret: Interpreting is probably the behaviour which distinguishes the practice of‘Adaptive Leadership’ from ‘Expert Intuition’. It is more challenging than a SearchCommittee’s usual operating mode which is observation followed by intuitive action.Interpreting can be understood as listening for the ‘song beneath the words’. Theobserver has to make his/her interpretations as accurate as possible by consideringthe widest possible array of information. In addition to what people say and do,body-language, emotions and especially what has not been said are also important.Intervene: The Observer’s intervention should reflect his/her hypothesis about theproblem and should be pre-tested bilaterally or in a smaller circle. Well-designedinterventions provide context; they connect the observer’s interpretation to thepurpose or task on the table so people can see that the perspective is relevant totheir collective efforts. The motto should be: ‘Experiment and take smart riskssmartly’. A group with a higher risk disposition can certainly cope with an observersuggesting riskier interventions – as long as they are ‘smart’.METHODIn order to explore the broader field of C-level recruiting practice, I drew from myown experience as an Executive Search Consultant. The context of the case studyis a high level Senior Executive recruitment process of a deputy country head.Although the recruitment was considered a ‘success’ by the organisation, it resultedin conflict and collateral damage.Face-to-face interviews were conducted with two members of the Executive Searchcommittee. After the recruitment, I added my own experience as the mandatedSearch Consultant, and six market insiders were interviewed too.A multi-method approach including phenomenology, hermeneutics andorganisational ethnography was used. Nicolini (2009) suggests that the best way tostudy organisations for organisational ethnographers is to zoom in and zoom out5.Accordingly, I began with looking at the organisational context (the ‘SystemsPerspective’), then zoomed right into the heart of the Search Committee and morespecifically into their intuitive decision-making process. Finally, I zoomed out againto gain a broader perspective on the reciprocal impact between the SearchCommittee’s group mentality and the organisation’s social climate at large.Via data triangulation, data consistency or inconsistencies were cross-checked withadditional key stakeholders and through reflection sessions with the German ChiefOperating Officer, and active participants and Members of the Extended SearchCommittee. The shared meaning of our experiences constituted the basis fordescribing the phenomenon6.For more information, please refer to my EMCCC thesis (Scherf, 2013).17

Key Findings & DiscussionAnalysis of the Search Process itself and interview data collected with six C-levelSearch Consultants and two Search Committee Members suggest that there is nostate-of-the-art or at least common practice or tool that helps Consultants or SearchCommittee Members manage process inherent group dynamics and risky individualbehaviour.One key expert regarding the German Corporate Governance Codex clearly statedin the course of the interview that C-level Search Committee Members were“beyond criticism and influence regarding their judgment and decision-makinganyhow”. This statement was more or less unanimously made by the otherinterviewees. Another common pattern observed by interviewees is that SearchConsultants too often tend to accommodate their clients as opposed to challengingthem. Unfortunately, it is rather an exception than a rule that a Consultant is willingto walk away from a ‘highly political’ mandate with Board Members involved.The essence from the shared experience expressed by the interviewees can besummarised as follows:The Search Committee was weak from the outset due to unaddressed andunmanaged conflict and unconscious group phenomenaThe Global Head of Regions based in the HQ initially invited the Consultant to aconfidential meeting and said: “We have to find someone to make the Country Headstronger, who works with him in a team. I don’t want to frustrate him and take therisk of losing him He needs to understand that he cannot do the job alone andthat he is meanwhile too far away from his clients and busy with managing the restof the organisation.”One assumption that could be made from this quote is that the pattern ofunaddressed conflicts and decision procrastination within the entire SearchCommittee has its roots in the company culture. In companies in which the ‘basicshared fantasy’7 of the larger system is the primitive response of fight/flight, such astance nurtures a “projection of one’s own hostile feelings onto others and splittingthe world into good and bad” resulting in anger, hate, fear and suspicion. Suchcultures are typically “living in the past with a short-term time horizon, impulsiveaction, a rigid style where means are made very explicit but goals are poorly definedand the persuasive style is rather insular” 8. The organisation is most likely in anoverall paranoid-schizoid position which would explain the tendency to employ themost common form of defence, i.e. splitting. Kets de Vries writes that “The strengthsof such neurotic styles are: good knowledge of the threats and opportunities insideand outside the firm and reduced market risk due to diversification. Potentialweaknesses are: a) Lack of a concerted and consistent strategy – few distinctivecompetences and b) Insecurity and disenchantment among second-tier managersand their subordinates because of the atmosphere of distrust”9.18

There was no agreed maintenance of territorial, task, role and rolerelationship boundariesThere was evidence for boundary transgressions in several situations and also atthe beginning of the search process. One Search Committee Member stated: “Thefact that my boss sitting in the abroad headquarter initiated the search processwithout my involvement is an act of castration” – expressing a clear territorial androle boundary transgression. The proposal made very clear who was sitting in thedriver seat: “The process will be driven out of the Headquarters – the CountryHead will play a crucial role in his function as Regional Head Germany – therefore,he needs to fully buy into the process”. The Search Committee members basedabroad had interviewed candidates who had not met the Country Head yet. Thus, adirect reporting line was automatically put in place by conducting initial interviews inthe HQ. This clearly undermined, and shifted the local power from the German CEOtowards the future incumbent who then had direct access to the HQ.Expert Intuition is not the right tool to deal with the complexity of groupdynamics within a Search CommitteeThere was also a collective blindness towards the need for a commonly ag

2 The Annals of Psychodynamic-Systemic Practitioner Research VOLUME 2 Editors Elizabeth Florent-Treacy, Senior Lecturer and INSEAD Dutch Alumni Fellow in Leadership, Diversity, and Governance Manfred Kets de Vies, INSEAD Distinguished Clinical Professor of Leadership Development and