HR Pulse

The art and science of CEO selection part II: high levels of smarts and then some

In my position as managing director of an assessment company, I have had the tricky task of understanding scientific tools have limits while maintaining the profound respect I have for the mature body of academic inquiry and evidence-based research that demonstrates the value of psychological measurement. When searching for a CEO, scientific tools can provide the insight you need into a candidate’s executive functioning. Assessments are one sure way to provide data metrics that can prove invaluable in the selection process. Take the following story.

A client consulted with us about doing assessments on the most senior people in their organisation: “You need to understand,” the head of HR told me with a concerned look, “that I don’t want these execs filling out personality questionnaires or some EQ tool.”

She went on to tell me about the big egos involved, that these were seasoned execs at the top of their game, and that conventional psychometrics would not be adequate. “We need to form a new team for our CEO and we need to take a deep look at the functioning of these individuals,” she said almost disbelievingly.

So what does the science say?

In some ways, it is very clear. Cognition is the best predictor of overall job performance. Those most skilled at problem-solving, abstract reasoning and good analysis are more likely to apply that thinking effectively in their roles. For this reason, the breadth of thinking (complexity) and raw problem-solving ability (abstract reasoning) rank highest.

Cognition can address about 40% of the risk in making an appointment, although estimates can vary. That is pretty huge, and in some ways cognition is the ticket to play. Without the required complexity and abstract reasoning, the candidate will struggle to evaluate necessary variables and see how these unfold in an imagined future. Cleverer people are simply better to employ. Following that, assessing personality, EQ, interpersonal style and leadership all add valuable information but on their own do not provide anywhere near the measurement advantage provided by cognition.

There is a good reason why ability tests provide more valuable information than non-ability tests

You cannot fake an ability test. You cannot pretend to be smarter than you really are but you can distort how empathic, kind, diplomatic, conscientious and resilient you are in non-ability tests. People do it! All the time! Sometimes they do not even know they are doing it but it is human nature to use self-report tests (like personality) to provide the version of yourself that you think employers would want to see.

This distortion can be subtle or profound, and while there are scales in personality tests to detect distortion, it is unclear exactly what the response to that distortion should be. Reject the candidate? That would probably be an over-reaction as in job interviews people tend put their best foot forward rather than the more insecure part of self, hiding behind that brazen confidence.

Our client believed that simple psychometrics were far too simple for most senior executives

The solution we tailored then involved employing psychological tools designed to provide metrics on work-related personality constructs:

• The tools focused on individuals’ qualities and intelligence using manufactured, generally challenging, situations.
• These psychological tools, which were designed to provide metrics on work-related personality constructs, are just as rigorous as standard psychometric tools. The difference is that our chosen solution included trained facilitators watching the behaviour of an individual unfold in real time.

It is not a bland experience and can be edgy as the facilitators create uncomfortable situations and note how the candidates respond in difficult circumstances. This solution, called assessment centres, is a very useful analogy of what happens in real world working conditions.

There are many possible assessment centre exercises. A typical battery for an executive could look as follows:

• A leaderless group discussion in which everyone is given a different brief they need to argue for. This creates an opportunity to see how execs do with other strong leaders, how they listen to each other, how they deal with conflict, dissent and how they influence.
• An investigative press interview covering a sensitive area in the business. The facilitator takes the role of a reporter, probes, pushes and prods to see how the exec is able to think on his feet, shows statesmanship, communicates and generally makes an impact.
• Competency-based interviews centred on any key aspects of the business. Using work levels and complexity, questions are positioned in terms of what the exec has done in their work history. The facilitators are focused on the thinking complexity in multiple areas and are able to rate the executive intelligence that senior leaders bring to organisations.
• Strategic thinking exercise. This can be a power test in that the exec is overloaded with too much information and has to present an intervention to a panel. Facilitators look at where the exec focuses their energy and what he chooses tells a story of the leader’s comfort in dealing with complex data.

These exercises offer a wealth of information on multiple aspects in a period as short as five to six hours. Some of the constructs which can be measured include:

• Emotional intelligence,
• Resilience,
• Communication, and
• Rapport.

The exercises allow a deep look at how the executive thinks but also evaluates:

• Their openness to criticism,
• How they would work with other members of a senior team,
• How fragile their egos are, and
• How they keep their emotions in check.

Importantly, the assessments also offer the opportunity to ask executives their motivations for acting in a particular way and to understand their judgements in navigating the way forward in complex situations.

Without completing any questionnaires, the assessment centre vehicle offers in-depth and predictive methods of finding the right executives.

Our nervous client was thrilled with the results!

We were able to report on the deeper issues with each candidate and also understand how they would work together as a team. Importantly, we had engaged with the levels of self-awareness of each of the execs and had understood where each needed to grow.

So while having no instrument-derived metrics, we did have clear measurement from the assessment centre. We were very confident about the information we passed on to the organisation.

It was somewhat unusual for us to only use assessment centres but these did provide a highly effective mechanism to make selection decisions. As an assessment team, we were fully focused on using science to find the best people; we just did that with unconventional methods.