Adsum Insights Blog
What HR Doesn't Understand About Executive Onboarding
Many HR leaders keep finding themselves striving for a “seat at the table.”
Even when they get that seat, they find they still aren't getting the respect they want.
The table they want the seat at is surrounded by co-equal, co-contributing business people, each delivering their unique contributions to bottom-line value creation.
Delivering bottom-line impact means understanding the drivers and components of revenue/cost/productivity and the often hard to see short-term and long-term causal interconnections.
Many drivers and components are easy to see. They are line items in the budget…employee benefit costs or dollars spent on training.
But those budget items should hopefully be connected to longer-term outcomes.
Training costs are plain as day in the budget and may be drawing scrutiny. Could they also be strengthening your bench and allowing you to fill more positions from within?
What is the productivity and financial value of not having to leave senior leader seats open as long and not having to pay recruiting costs? What is the day-in and day-out additive productivity from the increased skills?
Yes, increasedd productivity is tough to measure, but there are leaks everywhere affecting organizational and financial outcomes. Not trying to find them and make the ROI case for closing them is a mistake.
Speed-to-Value matters. A lot.
The effects of increased speed are also hard to measure, but increasing speed through reduced cycle time also has real bottom line benefits.
Say last year, it took an average of four months to fill senior positions but now, through tightening the process, it only takes three months.
What is the productivity hit to the organizations under those senior leaders?
And therefore what’s was the ROI of the time and effort spent improving the speed and cycle time of that process?
The Hidden Value in Executive Transitions
First, the cold truth: executive new hires are getting very little support. It's basically sink or swim.
A survey by Egon Zehnder of 200 HR leaders in global organizations found only 30% were providing any kind of First Hundred Days support to new executives.
In the same study, organizations and even the executives themselves highlighted the fact that it often took six…sometimes even nine…months for outside hires to get fully up-to-speed.
Though very few got any support, was the support provided helpful?
Yes! Executives getting support said it helped tremendously. Many reported it even helped them hit their stride and become fully contributing faster.
The cost of on-boarding support are easy to identify. What might the value be?
Take a new executive making $500K a year (in a tech company, total comp is probably >$2MM including stock options), who will have an org with 200 people working for her, with a $60MM budget spend and $100MM total spend (including the payroll and benefit costs of those 200 people).
Imagine she could become fully contributing in six months instead of nine. Or four months instead of six.
What’s the productivity impact on those 200 people in her organization? What is a small increase in productivity on a $40MM spend worth?
Further, the organization has already set aside an initiative spend of $60MM that was approved because it had an ROI attached to it.
What is the value of a faster return on that investment because the new leader hit her stride faster?
"Palpable with a jaw-dropping ROI" is my answer.
Speed-to-Value matters. A lot.
The people at the table HR wants a seat at are not thinking about costs.
They are thinking about where they want to invest...or where they want to invest more...and the ROI of the value that will be created from that investment.
As with acquisition integration, transition support like this is not a cost, it’s an investment with high ROI.
Organizations have been living with on-boarding mediocrity, slow starts, and lost productivity since forever.
Step one is just deciding you're not going to leave this to chance anymore
Once you make that decision, you could certainly look outside for coaching help.
But there is a better way.
Organizations that have a robust "growth through acquisition" strategy often dedicate resources from various functions to do post acquisition integration. Why? Because integrating acquired organizations faster with minimal confusion provides a high ROI on those dedicated resources.
If senior leader hiring or promotions are occurring regularly, HR could easily do the same by tapping or hiring an internal resource to help the new leaders integrate well and get to full contribution faster.
As with acquisition integration, transition support like this is not a cost, it’s an investment with high ROI.
"The buck stops here," high return moves like this will help HR earn the seat...and the respect...they've been striving for.
Dennis Adsit, Ph.D. is an executive coach, organization consultant, and designer of The First 100 Days and Beyond, a consulting service that has helped hundreds of newly hired and promoted executives get great starts in challenging new jobs.
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