Historically, companies have struggled to spot their next leaders. Employers often hire based on what’s worked in the past- looking at key indicators like performance to determine a candidate’s fit for leadership. But when you don’t know what the future holds, how do you understand who has the potential and the right strengths to meet those challenges?
It boils down to hiring people who have both the skills today and tomorrow to grow and evolve in the role. That requires abandoning an over-reliance on past experience, and embracing a person’s potential to lead down the line. This guide will provide you with the keys to hiring people for leadership roles.
Why companies fail at leadership hiring
Picture this. Your high-performing sales superstar gets promoted to a Sales Manager role. But a few months into the job, the sales team falls apart. Your best SDRs’ walk away. And that’s when it clicks. This person may be a great salesperson, but they’re unfit to lead, and it’s costing you your best employees to realise this.
Does this situation ring a bell? Most companies fall into this trap for two reasons. Employers either fail to prepare their organisations and employees for critical leadership roles, or fail to spot who is going to be a good fit for such a role.
One thing is certain. The stakes are high when hiring for leadership positions. One wrong decision can cost thousands of dollars and your best employees in the process. In this context, employers usually play it safe by hiring based on a person’s track record for leading in the past rather than a person’s potential to excel. And that’s where the problem begins.
Per Thunberg spearheads the Talent Development function at Marshall Group, and has worked on an internal leadership development model. He is familiar with the problems companies face when hiring for leadership positions.
The danger here is that companies can dilute the objective decision-making process and hire based on gut-feeling, connections, and a person’s piece of-paper credentials. This compounds the risk of making a bad hire, with an unstructured succession planning process costing companies up to $1 trillion a year.
Ultimately, what a person has done in the past doesn’t tell you how they might cope with change or know what to do when they don’t know what to do. It also excludes early-career talent with all the potential to be great leaders but none of the guidance or mentoring to make it happen.
What makes a great leader
The most successful salespeople, engineers, and investors have exceptional technical skills, knowledge, and abilities to self-manage. But can those same skills be used to get a group of people to abandon their self-agendas and work together as a team for a united vision? Most likely not.
The performance level of individuals is measured largely through their ability, likability, and drive. However, leadership requires a broader set of characteristics, including high levels of integrity, emotional intelligence, curiosity, insight, determination, and resilience. This explains why high performers don’t necessarily translate into great leaders.
Great leaders have a few defining traits in common. They are open and adaptable, no matter how experienced. They also are active learners. Interestingly, there is a direct correlation between personality and leadership. Certain traits are generally related to leadership success and can be identified using a structured, objective hiring process.
What personal qualities determine leadership potential?
Based on research, the most effective leadership activities fall under three brackets:
✅ Achieving results- Defining where the team needs to go, planning and organising work to get there, driving towards ambitious results, and persisting in the face of obstacles.
✅ Influencing others- Inspiring and motivating your team- both at the individual and team level and networking with internal and external stakeholders.
✅ Navigating change- Balancing learning and taking in multiple perspectives with the capacity to make decisions and move forward with integrity and ethics in mind.
This can be broken down further into core areas of behaviour.
Behaviours associated with achieving results:
- Driving towards results
Behaviours associated with influencing others:
- Relationship building
- Getting others onboard
- Helping others grow
Behaviours associated with navigating:
- Making decisions
- Inner guiding compass
However, leadership is not just about harbouring natural attributes- leadership can be practiced, nurtured, and learned.
Per Thunberg recently shared his take on this:
How to identify high-potential employees
Say you're a hiring manager that needs to fill a leadership role. What do you do next?
Firstly, you must find a system that allows you to identify certain leadership behaviours in candidates. Research has shown that cognitive ability has repeatedly been a strong predictor of job performance in various leadership roles. Interestingly, so has emotional intelligence, with two-thirds of a leader’s performance accounting for their emotional intelligence.
But how do you measure cognitive ability and emotional intelligence together? Psychometric assessments are a powerful addition to the hiring selection process, with the Big Five Personality Test and Logic Reasoning Test contributing to a direct correlation in predicting job performance.
Why? Psychometric test results focus on the parts of leadership that are more stable over time. Your traits, such as personality and logical ability, remain mostly constant. It also means pairing this with a structured interview process, so you can assess a person’s past behaviour in roles, to predict how they would act on the job accurately.
According to Alva’s Lead People Science, Kajsa Asplund, emotional stability holds particular importance when determining leadership role fit.
“We are living in a very fast-paced world where you need to constantly grapple with things being different than they were restaurant. You need to make these really complex decisions in a world where we don’t know what’s going to happen tomorrow. Emotional stability is one of the Big Five Personality traits that has a lot to do with being stable in the face of adversity, basically. So having a tendency not to react emotionally in a negative way.”
Introducing structure into your assessment process
It’s a given that for any method you use, you must move away from making decisions based on baseless criteria like gender and background, and move toward applying objective methods that measure the person behind the CV.
The best tools to spot leadership talent is to combine psychometric assessments, such as personality and logic ability assessment, with skills tests and case exercises, along with structured interviews with pre-defined questions and criteria.
These evaluation methods will enable you to measure aspects like emotional stability and cognitive ability that are truly essential for the leadership role. More importantly, you will be able to measure things like adversity and the ability to navigate complexities and change.
Kajsa unpacks this further.
Craft your own leadership framework
Leadership frameworks can be particularly useful if your organisation has a grounded understanding of the culture and what kind of culture it wants to attain and grow internally.
If you have one of these frameworks in place, it can be easier to set expectations for leaders from the get-go, and ensure these expectations trickle down into all aspects of assessing, nurturing, and developing your leaders internally.
To do this effectively, think of your leadership framework in terms of the behavioural actions you want to see in your leaders. For example, what kind of action patterns or behaviour patterns do you want to see from your leaders in everyday work life? If you nail this common understanding in your organisation, it’ll be easier to emulate this leadership model internally and promote it successfully.
Have a leadership development plan in place
A good way to understand where your leaders are and where they need to head is to have a leadership development plan in place. For example, say you have a newly appointed Customer Success Team Lead. The person you’ve appointed used to be a Customer Success Manager. They have experience handling customer portfolios but haven’t led a team before.
One way to help that person develop and succeed as a Team Lead is to focus on their strengths. Say, they’re very good at helping others grow, and are forward-thinking. How can you tap into the person’s strengths further and develop them?
Tip: Sit down with the person and identify their key strengths and development opportunities that can be applied to a leadership role. Once you have a clear picture of what the employee’s strengths are, you can tailor a customised plan to get them where they need to go for a more senior-level position.
Do this, and you will be able to understand what kind of leaders you need in your organisation.
Tips on harnessing leadership potential
To harness leadership potential earlier, there are a few steps you can build into your talent processes.
The first step is to educate hiring managers on how to:
➡️ Screen early-career hires
➡️ Run candidate evaluations effectively
➡️ Manage performance reviews
➡️ Select team members for career development opportunities
A simpler way of identifying a future leader is by observing who others go to. Some people are exceptionally good at helping and supporting others. This trait tends to lead to others seeking out their expertise or support. A strong indicator you have a future leader on your team is if people from other teams also seek out this individual. This means that they are people who get things done and make results happen.
Finally, you can create a leadership profile to see what talent has leadership attributes that can be nurtured and developed over time. Whether for hiring or developing internal talent, at Alva, we have developed a Leadership Report that helps TA teams easily assess leadership ability. How it works is you use Alva’s Personality Test with a specialised “leadership lens” that allows for deeper insights into every candidate’s key strengths, readiness, and potential. We also have detailed reports to help with internal development.
Creating a new model for assessing leadership potential
Kajsa recently created a new scientific model for assessing leadership.
Her process was simple:
To identify these behavioural patterns, Kajsa recommends following a two-tiered approach:
1️⃣ Use a test profile to ensure that this candidate you are assessing has the most basic qualities in place that correlates to good leadership in any role, suh as results, orientation and emotional stability.
2️⃣ Once you have ensured these things, then you would apply Alva’s leadership report to paint on all these nuances and see where the strengths and weaknesses of each person lie.
How Alva’s Leadership Report helps you hire better leaders
The Leadership Report is available on the Alva platform across all subscription levels. If you're looking to evaluate leadership candidates on a deeper level, or just simply want to learn more about the Leadership Report, book a demo with us.