Naturally, I get this question: “What does this crisis mean for executive recruitment? Won’t execs all be hunkering down?” Honestly, I think the exec ranks will be as “dynamic” as everything else is right now. A few hypotheses:
So many executives are working extended and extra-stressful hours. They are reviewing new alternative strategies with their board, scenario planning (again and again) with their CFO, and perhaps preparing for layoffs and re-editing associated employee communications. On top of this, they are also negotiating with banks, investors and creditors.
Adding to their stress is the fact that their spouses are agitated that even though they are physically present, they’re not available to hold up their end of the partnership. There is added pressure now, especially given that the kids, meals, work and entertainment are now all at home.
A sense of commitment to the team and the mission carries one through as a leader. But once they ensure that their team and the stakeholders are stable, won’t they need a break?
For many executives, equity is a meaningful component of compensation. Therefore, it serves as a compelling reason why people stay at a company. Equity is well designed when it incentivizes leaders to create value over multiple years.
However, given the impact of the COVID-19 crisis and an uncertain outlook for the future, a lot of equity grants are no longer valuable. So, some executives may ask, “why stay?” They will not realize the expected upside of their equity. Instead, the next two years will be another slog, with an unclear likelihood of great return.
Several real-life examples illustrate this phenomenon. One executive said she “feels like she’s working for free.” Another stated that her contracted severance was actually more valuable than the payout of her current comp package. A third led the charge for his C-suite to take an additional 10 percent in total compensation reduction compared to the reductions for the VP ranks.
You No Longer Fit
Executives are typically appointed to their particular position because they fit the context. As an example, you might be highly commercial and able to drive a growth strategy, have extensive international experience and able to expand into new markets or be well versed in acquisitions and able to consolidate the industry. Well, you may no longer fit the specs the company needs. The board may have hired you for a certain spec and now may need something new. Perhaps they might need to shift from a peacetime leader to a wartime leader. The playbook changed, so the coach may need to change the team to accommodate it.
Your Job is Less Fulfilling
There may be aspects of your job that exist no longer. If, as a sales executive, you loved jetting across the country, meeting people, and wining and dining before traveling to a boondoggle to celebrate “club” accomplishments, you may be feeling a bit dismayed at this jarring change. If, as a marketeer, you loved engaging customers to buy and shop, activating them with compelling messaging about fashion and style, you may be bored and bewildered. If, as a CHRO, you loved building teams and setting up the infrastructure to help a budding business scale, you are likely disappointed at what’s on your to-do list today.
Yes, the job requirements, the expectations and the mechanisms by which to deliver on your remit have all changed. In some cases, these changes have been quite dramatic. There is a question of whether things will ever return to the way they were or if a new “normal” will emerge. It may be time to reflect deeply on your sources of energy and try to repurpose for the current situation. Doing so also can help set you up to better tackle the future.
So, will there be need for executive recruitment over this horizon? Yes. The catalysts have changed but leaders may need a break, lack financial motivation to stay in their current role, or be incongruent with their redefined roles, as discovered by their board/boss or themselves.