Shilputsi in the News
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CEO Hiring: Going Beyond Performance Measurement - Financial Express: August 9, 2003

If the resume of a CEO said something like “I hold a track record of creating profitable business for the organization” as one of the achievements, chances are such a resume will fall way below the priority list of a recruiter. And this is all the more true if the company in question belongs to one of the new-age business verticals like BPO, Healthcare and ITES.

With these contemporary entities demanding a completely new range of skill sets and competencies to succeed in the turbulent market, companies that are planning to hire a CEO are apart from giving weightage to Performance Track Records (PTRs), headhunters and HR professionals affirm that businesses are more eager to assess customized abilities which the CEO will bring to the table so as to build a successful venture.

Says PricewaterhouseCoopers head (HR) Dipak Gupta: “Increasingly companies are now telling their top management candidates “Well, we are fine with the past. But more importantly tell us what’s the business model you propose for the vertical in which we are in.”

And the intuitiveness that the professional can display in any such interaction with the recruiting entity proves crucial in either landing an offer or losing out on the option.

The reason this is happening is because businesses are unwilling to consume longer cycle time to break-even or even get into the turnaround mode. And giving more emphasis to assess a range of customized capability helps the organization determine whether the individual will be able to perform within the shortest possible time frame.

Says Ma Foi general manager (executive search) Sangeeta Saberwal: “The endeavour for companies is to be a part of the movement while it is happening. In which case they need someone who has a very short gestation period to get going.”

HR consultants, however, believe that it is not the non-performance of CEOs with good track record that is driving this change in mindset among companies.

Says Shilputsi Consultants director Purvi Sheth: “This is happening not because CEOs have failed, it is just that businesses have changed.” Ms Sheth believes that companies do not want to know how successful the individual concerned has been in previous careers.

“Companies are also trying to know how they can cope with failures and evolve relevant action plans to prevent repetition of the same. And certain new businesses may demand a distinctive set of competencies and, therefore, the previous track record may not necessarily demonstrate all of these attributes,” she adds.

The ability to learn from failures is one of the crucial competencies that companies are looking at while hiring a CEO. The other competencies include relationship management, specifically with clients, and the ability to have a holistic business leadership.

Says Cap Gemini Ernst & Young head (people relationship management) Atul Srivastava: “Leadership development for these businesses veer around three axes and they include, business, functional and technical leadership.”

And the fluid environment today requires leaders who can manage and align change with corporate objectives. “Although past performance is important it doesn’t guarantee future performance. More so when business variables are constantly changing,” he adds.

However, some companies prefer to maintain equilibrium between track record and specific capabilities that the CEO may display.

Says RMA Vector International director (India & Middle East operations) N Srinivas: “Companies try to gauge the performance ability of the candidate based on the past track record, along with trying to determine how they can create a roadmap for the future.”

“Give us a future so as to be a part of the current organization”—this seems to be the new mantra in CEO hiring.