Picking a CEO

by Steven Cerri on February 13, 2014

Picking a CEO

The blogosphere is filled with people talking about the selection of a recent CEO, notably the CEO of Microsoft.

Many were surprised that Microsoft went with Satya Nadella, an internal selection and not an external pick.

Of course there are pros and cons associated with selecting an internal candidate versus an external candidate and I won’t bore you with the well known advantages of each. We all know that story.

However, what I think is worth discussing is the idea that selecting external versus internal candidates be based on shifting hiring trends. In my opinion this is an error.

You will hear people say things like “… the trends in hiring seem to shift every few years as to whether it is better to hire a deeply experienced internal candidate or an external candidate. A few years ago, the preferred candidate for top positions was an external candidate, while recently the trend has shifted toward promoting from within.”

From my perspective, whether you are hiring a C-level executive, a vice president, director, manager, or supervisor, going with some type of “current trend” is a big mistake. The “trend” seldom represents any individual company or organizational culture.

The key is the “context”. That is, what is the current situation, what do you want to accomplish, and what is the most expedient way to accomplish the goal given the boundary conditions (the constraints you have) to achieving the desired outcome. That’s it.

I have seen many companies select hires based on what someone else says they should do (the current trends and fads) only to have the candidate fired six months later because of lack of alignment with expectations.

While we may not have the answers to the above questions and parameters in the case of Microsoft’s selection of Satya Nadella, we can surmise where he will take Microsoft and what marching orders the Microsoft board gave him when he was selected.

Satya certainly will not turn Microsoft upside down or inside out. The given conditions of the company are not bad, in fact the company is stable. There is no need for drastic measures. The current foundation of Microsoft represents a reasonable place from where to begin with a new CEO. Therefore, Satya was chosen from an internal, known pool of candidates.

In contrast, Yahoo selected an external CEO. Not based on a fad or trend, but based on the fact that the foundation of the organization at the time was not one from which much growth seemed possible. Therefore, ignoring whatever trends might have indicated, the Yahoo board went outside because “something different” was necessary.

So, from my perspective, context rules. The situation dictates the actions to be taken to achieve the results desired. Fad thinking is not important nor useful.

Food for thought.

Be well,

Steven

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