What leadership skills and traits are high on board directors’ lists?
Any decision a corporate director makes could potentially put the future of the entire enterprise at stake. Identifying, attracting, and retaining top senior leadership talent is no exception.
As we noted in our “Top Six Corporate Governance Dos and Don’ts” white paper, board directors should avoid becoming victim to pitfalls such as emotionally fueled decisions, surface-level hiring, or group-think. In short, they must refrain from making selections based on friendship, reputation, impressive resumes, or everyone else”s opinions.
According to a study conducted by Boris Groysberg of Harvard Business School, companies tend to prioritize the following seven skills and traits when assessing executive talent:
It is no surprise that Groysberg”s research, as outlined by the Harvard Business Journal, identified the ability to confidently pilot a company in tandem with the wishes of the board and the established trajectory of the firm as the most important attribute of a successful C-suite executive. However, it is important to remember that there is no singular recipe for success in this regard. Rather, enterprises have unique needs that require different leadership styles. For instance, leaders can fall into diverse categories such as inspirational, non-authoritarian, take-charge, visionary, and ethical.
- Strategic thinking
Also known as strategic foresight, setting the strategic direction, operational savvy, and vision execution, thinking strategically is an extremely important element of organizational leadership. At the Epsen Fuller Group, we advocate remaining competitive by establishing a system for identifying, evaluating, and acting on new trends and competitive threats, all the while ensuring that any actions taken align with the values of the board and the core mission of the business. Rudimentary and incomplete strategies generally lead to ineffective leadership and should therefore be avoided at all costs.
- Technological and industry-specific knowledge
Technology has changed the way people at all levels of a company do their jobs, from entry-level workers on the ground floor to members of the corporate board. Given this reality, technological literacy, digital and big data savviness, as well as industry-specific skills continue to be highly prized by boards looking to fill even non-technical C-suite and senior executive roles.
- Interpersonal skills
The days of the CEO sending out final decrees from behind closed doors are over. Now, talent acquisition decisions will be largely based on whether a candidate “plays well with others,” from the board of directors and other members of the C-suite to middle managers and other subordinates.
- Persuasiveness and effective communication
Persuasiveness and solid negotiation skills are highly sought after by the board in their senior leadership team, especially if an executive has been brought in from the outside to provide the leadership team with a fresh perspective. Members of the C-suite need to win over a variety of stakeholders. A certain flexibility in terms of communication and presentation skills is required for “speaking convincingly to the concerns of varied audiences – knowledgeable and unsophisticated, internal and external, friendly and skeptical,” wrote Groysberg.
- Change management
If enterprise growth is stagnant, revenues are decreasing, or the company is abjectly failing, shaking up operations by appointing a change agent as a leader could be the organization’s best hope. Sometimes, boards need to recognize that bringing in external talent is the only way to identify and transform toxic or problematic aspects of the business
Whether a C-level leader is caught in a professional lie (e.g. former Yahoo CEO Scott Thompson) or faces compromising personal allegations (e.g. former Hewlett Packard CEO Mark Hurd), his or her integrity will suffer – and, by extension, so will that of the company. For the board of directors, preserving the reputation of the firm is paramount; senior-level hiring decisions should always be made in keeping with this goal.
“Quality of leadership is a critical organizational differentiator,” commented Thomas J. Fuller, CEO and managing partner of the Epsen Fuller Group. “Board directors must recognize that executive hiring decisions can either help them achieve full talent and business objectives or hold them back.”
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