Our exclusive leadership expert panel includes world-renowned leadership coaches, CXO's,TEDx speakers and influencers in the leadership space, who have been guiding startups, SMEs as well as fortune 500 companies in achieving their leadership goals for decades and continue to do so.
This report covers three broad areas related to leadership hiring:
Top challenges that organisations face when looking to fill leadership positions and future problems that they are likely to face.
Leadership hiring practices that organisations follow and how they are evolving with time.
Learn about current leadership hiring best practices to increase your chances of achieving leadership success.
50% OF ORGANISATIONS ARE UNABLE TO MEET THEIR LEADERSHIP TALENT NEEDS
Our research revealed four key challenges that limit the ability of organisations to fill leadership vacancies with the right talent. These four challenges are:
No Internal Pipeline of Candidates
34% of organisations state 'lack of internal leadership succession pipeline' as the biggest challenge when it comes to filling a leadership vacancy.
Long Hiring Lead Time
27% of organisations consider long hiring lead time as the biggest factor that is responsible for their inability to hire and onboard the right leadership talent.
Inaccurate Hiring Methods
The inability to identify the right talent by assessing their skills accurately causes 23% organisations to misjudge and reject the right talent, only to select the wrong one.
Poor Knowledge of Who to Hire
16% of organisations are unable to find the right leadership talent as they are not aware of the kind of talent that they want to hire.
ORGANISATIONS STRUGGLE WITH LEADERSHIP HIRING DUE TO LACK OF SUCCESSION PIPELINE AND LONG HIRING PROCESSES
Top Leadership Hiring Challenges
Top Leadership Hiring Challenges Faced by Organisations of Different Sizes
No internal pipeline of candidates to take up leadership positions
Inaccurate hiring methods
Long hiring lead time
Poor Knowledge of who to hire
Top Leadership Hiring Challenges Faced by Organisations
LEADERSHIP HIRING TRENDS
While it is true that the leadership hiring approach needs to be different for each organisation, there are some hiring practices that can increase the chances of finding the right leadership talent for any company.
Leadership Competency Framework
of organisations do not have any competency framework in place, based on which they can structure their leadership hiring process.
Top Skills Assessed During Leadership Hiring
of organisations assess personality skills during leadership hiring, followed by the domain (33%) and cognitive skills (29%).
Use of Scientific & Technology-Driven Hiring Tools
of organisations make use of some scientifically validated talent assessment tool during the leadership hiring process.
Time Taken to Hire Leadership Talent
is the average time the leadership hiring process takes to be completed.
1. Leadership Competency Framework
Leadership competency frameworks provide a structured framework for defining those skills and competencies that have the most significant impact on an organisation's performance.
Having a well-rounded competency framework that covers all major skill areas - cognitive, personality, behavior, domain and technical - is essential to assess leadership talent thoroughly. Basing leadership hiring rounds around competency framework custom designed for each job role, makes the talent assessment process more thorough and accurate, thereby increasing the hiring success rate.
42% of Organisations Do Not Have Any Competency Framework in Place
Organisations Having an Accurate Leadership Competency Framework
Large Organisations Are More Likely to Have a Leadership Competency Framework Than Smaller Organisations
Competency Framework Usage for Leadership Hiring by Small & Large Organisations
Industries with People Centric Job Roles Usually Have a Leadership Competency Framework
Organisations that Don't Use Competency Framework
Organisations that Use Competency Framework
Competency Framework Usage for Leadership Hiring by Different Industies
2. Top Skills Assessed During Leadership Hiring
Leadership roles are incredibly complex. They require high levels of cognitive, domain and, most importantly, interpersonal skills to carry out day-to-day work tasks.
Most leadership experts agree that the most critical aspect that needs to be assessed in talent during leadership hiring is their cultural fitment and leadership potential.
However, assessment of other skills and competencies such as cognitive, tech, domain, learning agility, and dark personality traits, is quickly catching up.
Most Organisation Assess Personality and Behavior Skills During Leadership Hiring
Top Skills that Organisations Assess During Leadership Hiring
Organisation Assess Skills That Are More Relevant in Their Respective Industry
Top Skills Assessed During Leardership Hiring by Different Industries
3. Use of Scientific and Technology-Driven Hiring Tools
Use of modern scientific tools for talent assessment is gaining pace rapidly.
â€œI have found face to face interviews not actually indicative of someone's skillset or potential as an employee or leader, and am now an advocate for more hands-on or experiential tests to see if the candidate would be a good fit, especially for leadership positions where the individual has to mesh well with an entire team.â€? - Stacy Caprio - Founder of Accelerated Growth Marketing
Leadership hiring experts firmly believe that the age-old practice of assessing talent via 'face to face interviews only' is not very accurate.
77% of Organisations Use Talent Assessment Tools During Leadership Hiring
Talent Assessment Tool Adoption During Leardership Hiring, Across All Organisations
4. Time Taken to Hire Leadership Talent
Long hiring lead time is the biggest reason for candidates backing out in the middle of the hiring process. Most leadership hiring experts that we interviewed, emphasized the importance of providing a good candidate experience during the hiring process, to ensure that they go through with it. Providing a good candidate experience involves keeping the hiring process structured, concise and staying in constant touch with the candidate.
The Average Time Most Organisation Take to Hire Leadership Talent Is 3.5 Months
Time Taken to Leadership Talent
The biggest challenge faced when hiring leadership is competition. Good talent is in high demand, so some of our candidates have a lot of options. When some clients delay a decision, the candidate may have taken another position and is no longer available.
Healthcare and BFSI Have the Longest Leadership Hiring Lead Time, Whereas Retail and Media Have the Lowest
Average Time Taken to Hire Leadership Talent (In Months), by Different Industries
Larger organisations take longer to hire leadership talent due to the large number of processes that they must adhere to. In smaller organisations, the leadership hiring process is improvised based on how fast they want the new leader to join.
But again, the time that is taken to hire leadership talent also depends on how high in the job hierarchy is the new hire going to be placed.
Using scientifically validated talent assessment tools and competency frameworks, organisations can become more efficient in leadership hiring and keep the process short, while not compromising on the quality of the hiring process or hires.
Larger Organisation Have Longer Hiring Lead Time
To identify the best practices that can increase an organisation's chances of finding the right leadership talent, we asked our survey respondents and leaders what they perceived as their leadership success rate. We then correlated their responses with their leadership hiring practices to find out what methods are likely to increase the chances of hiring the right leadership talent for any organisation.
Here's what we found:
1 Use of Scientifically Validated Talent Assessment Tools
Organisations that utilize some form of scientifically validated talent assessment tools for leadership hiring are more likely to succeed than when only traditional methods of recruitment are used.
Use of Talent Assessment Tools makes Organisations More Likely to Achieve Leadership Success
- - - 'Leadership success rate' vs 'Scientific tool adoption rate' trendline
Leadership Success Rate vs. Scientific Tool Adoption Rate by Different Industries
2 Having an Updated Leadership Competency Framework
Organisations that have an accurate and regularly updated organisational and leadership competency framework, on the basis on which they carry out their leadership hiring, enjoy higher leadership success rate.
The benefits of competency-based hiring are multifold. Having an accurate leadership competency framework means that the organisation is aware of the kind of skills they want their leaders to have. Also, these organisations have a much better idea about the kind of talent assessment tools to use during hiring as they already know what skills they want to assess. Having a competency framework also helps in structuring the hiring process, bringing uniformity and efficiency and removing biases from the hiring process. All this leads to a more holistic and accurate talent assessment which enables the organisation to identify the right leadership talent more effectively.
Leadership Sussess Rate & Competency Framework Adoption Rate Are Highly Positively Correlated
- - - 'Leadership success rate' vs 'Competency framework adoption rate' trendline
Leadership Success Rate vs. Competency Framework Adoption Rate by Different Industries
3 Keeping Leadership Hiring Lead Time Short
Organisations with leadership hiring lead time of less than a month have a perceived leadership success rate of 80%, whereas those that take 3- 6 months to hire leadership to have a perceived leadership success rate of 47%. In general, lesser the leadership hiring time more is the perceived leadership success rate.
Organisations that have shorter 'time to hire' can significantly reduce their candidate back out rate, thereby preventing loss of quality talent during the hiring process. In the present time and age, there is a significant shortage of leadership talent, and 89% of the talent that organisations would ideally like to hire are already employed.
How do you reduce your 'time to hire'?
Our study shows that the use of 'scientific talent assessment tools' and 'competency frameworks' is highly negatively correlated with 'time to hire'. What this means is that- higher the usage of 'talent assessment tools' and 'competency frameworks' during the leadership hiring process, shorter will be the 'time to hire.
Competency framework adoption rate is highly negatively correlated (-55%) with those industry's 'time to hire' leadership talent.
Talent Assessment Tools
Talent assessment tool adoption is highly negatively correlated (-56%) with those industry's 'time to hire' leadership talent.
Organisations Having a Shorter Leadership Hiring Process Enjoy a Higher Leadership Success Rate
- - - 'Leadership success rate' vs 'Average time to hire' trendline
Leadership Success Rate vs. Average Time to Hire Leadership Talent by Different Industries
The leadership talent pool is shrinking. Their demand outstrips the supply by a great deal. In this age and time, in order to identify quality leadership talent and hire them before someone else does, it's important to adopt the best-in-class leadership hiring practices that significantly enhances your chance of identifying the right talent accurately, followed by providing them with a delightful hiring process experience.
There are a couple of things that organisations can do to increase their chances of successfully hiring the right leadership talent. We have listed them down for you:
Create an organisation level and job role wise competency framework to know what kind of skills are needed in each job role (now and for the near future) so that you know who to hire.
Talent Assessment Tools
Make use of talent assessment tools to measure talent's skill levels accurately & make data- backed hiring decisions which significantly increases your chances of recruiting the right talent.
Internal Succession Pipeline
Have a ready internal succession pipeline to take up future leadership positions, as leadership talent is scarce in the market.
Involve leadership in leadership hiring decisions to ensure that the new leadership hires share the company's vision, mission, and values.
Make your hiring process more candidate friendly by making it structured and concise. Good talent is only available in the market for ten days.
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Survey Respondent's Organisation Size
Respondent's Geographical Location
Industries That The Respondents Work In
Mercer|Mettl's sincere gratitude to all the participating organisations for making 'Leadership Hiring and Development Trends 2019' survey a great success. We value your opinions and insights and offer this research as a token of our thanks. Here's a partial list of the participating organisations:
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Mettl is one of the largest and fastest growing online talent measurement solutions provider globally, and has been at the forefront of online assessment technology since its inception in 2010. We enable organizations to build winning teams by taking credible people decision across two keys areas: Talent Acquisition and Development.