Will You Be 1 of 4 in Ten Managers
who Don't Succeed?

Jeff Arnold
Written by Jeff Arnold
and Steven Feinberg

Most people think of changing management jobs - moving from one position or one company to another - as a challenge and an opportunity. If your experience is typical of business executives, you will have changed jobs about every two to four years and can expect to do so for the rest of your career. However, changing jobs is replete with what the Chinese definition of crisis suggests - both an opportunity and a danger.

In reality, beginnings are pivotal times for managers. Actions are amplified because the boss, peers, and direct reports see all decisions, involvement, judgment and communication under a spotlight of contribution. You are setting a pattern of performance and a pattern of working relationships. Going in the wrong direction will be career limiting to you and costly for the organization. In fact, research has shown the average cost of a failed senior executive is $2.7 million or -597% ROI. In addition to the obvious costs, some other factors included mistakes, wasted and missed business opportunities, and disruption.

If you have been a successful manager in the past, you will expect to do well in any new job. Yet research indicates that as many as 40% of new hires will fail. In informal discussions, executive search professionals agree that a high number of placements don't work out as expected. So why does a successful manager entering a new situation have only a 60% chance of succeeding? How can you become one of the managers who meet or exceed expectations? And what can organizational leaders do to improve the odds of their new hires working out?

The usual suspect when an executive fails in a new position is poor fit; between the individual and the culture or the individual and the job. Search professionals have sophisticated tools at their disposal to assure fit. Therefore, although these reasons are sometimes true, it doesn't explain all cases. Furthermore, this question of fit is of no help to a new executive working to succeed.

Any executive in a new position faces the following 'dilemma of action'. There is a strong expectation of action from the executive's boss, peers and direct reports. At the same time there is a strong need to study the lay of the land. Any military general will tell you that to design and execute a winning strategy you need to assess all the structural forces at play: terrain, weather, logistics, capabilities, politics, numerical size of their adversary, and many others. The following illustration lays out this structural conflict for managers

In a recent conversation, a senior executive reported that he wanted to see immediate action by a new hire. "At this level these guys should come in knowing the job. Sure, it will take a while to make contacts and learn the business, but he has to get right down to doing the job." This bias for action is widely held and pressures executives to reach fast conclusions.

There are only three resulting possibilities in this situation - right action, wrong action, or inaction. The bias for action and the pressure to leap to conclusions can lead to wrong action. The need to know can be perceived as inaction. And of course, wrong action and inaction can get you fired. Only the right actions will succeed. This means that we must be making fast decisions, but not the same old way. Penetrating judgment is the pivotal shift that determines the winners from the losers.

Most managers think they are adaptive and will do whatever it takes to succeed. Yet, if we look closely, they are often employing strategies that are similar to the one's they've used in the past. Why? They must be assuming that the new situation is the same as some previous experience. Of course, if the situation is the same then the same tactics will succeed. The failures come when the situation looks similar, but is in fact different. Many managers err by saying, 'it is just like x', when upon closer examination it only resembles x and is really quite different. This is similar to a doctor prescribing medicine based upon the wrong diagnosis.

In one of our consulting assignments we worked with a successful manager who made it his business to always get results, that's what mattered most to him in every job he did. Yet he was almost fired from his new position because he didn't see that collaboration was crucial, and without collaboration in his new business, he was dead in the water.

The major error here, and it is correctable, is taking our assumptions about reality as true. It is not easy to put aside preconceptions, and those managers who pay lip service to this are usually fooled. Even though any given situation might resemble another, it will be distinct to some degree. By way of comparison, all financial statements have similarities and yet we don't ever assume that this year's numbers are the same as last year's because the format of the report is the same.

Of course, reading reality is different than reading financial statements. Nevertheless, an expert reading financials will extract substantially more information than will someone with a rudimentary understanding. In the same way, through a penetrating understanding of what's really going on, we can extract quality insights that lead to a profitable course of action. We can see not only the facts, but by studying reality from particular vantage points, we can see trends, relationships and implications about the future. We can also see the traps and pitfalls that could derail our efforts.

We can take this a bit further. The cliché about thinking outside the box means looking at reality without bias or preconception. If we look to reality to recognize models we already know, we won't see the unique features of what is before our eyes. It becomes natural to bring our biases, models, preconceptions, and experience to looking at any situation. This is how we are trained. It is possible to retrain ourselves.

Senior executives typically know what is going on. However, it is the times you don't that will get you into trouble. When you begin your new managerial role, you have to analyze, design and implement. Any one of these elements can result in failure if you are misreading the reality you are confronting.

Let's consider, for example, that you take a position in a new firm expecting to focus on maintaining the productivity of the department. That's what the interview and job description lead you to believe. But things are rarely what they appear to be during an interview process. In reality, outside competitive forces may be requiring you to adapt the organization. If you don't get onto this immediately, you will be several months behind before you realize your credibility has been damaged.

The Six out of Ten Success Secret

So what are the successful managers doing?

They have acquired the capacity to rapidly assess what they are up against and establish a vantage point to leverage their resources and advance their organization. They don't perform a general analysis. Instead, they read the structural forces at play that drive all corporate behavior. These invisible powerful forces are like the hidden ocean currents that drive the tides. The underlying structural forces may not be seen, but their consequences are undeniable.

Sorting through all the expectations of the different stakeholders will help you analyze what is important and what isn't. But you have to go beyond expectations to what is ultimately motivating the department, organization and individual's behavior. We have to look at what's really moving things, at what's actually getting rewarded and reinforced. These underlying forces are present in all industry sectors and in all companies, both large and small.

We were consulting with a Silicon Valley organization where the prevailing culture was to be nimble and adaptive, change ready and innovative. Desirable traits indeed. Although the company had good products, sales were less than expected. A newly hired executive was adamant about the relationship between an innovative culture and product sales, declaring that both he and the market wanted innovation. As we explored the possible elements affecting sales the issue of stability came up. The VP Sales concurred that stability was the issue that was affecting sales. If the company was perceived as unstable, the product's longevity would be questioned, making the purchase a risky choice. An argument ensued. Finally the CEO agreed with the VP Sales and a strategic communications program was implemented.

It turned out to be the case that not recognizing the importance of stability had slowed sales Fortunately, everyone, including the new executive, could see the difference sooner rather than later. While the progressive culture was clearly valued, overemphasizing it had confused the market and initially clouded the talented new hire's judgment.

Once we see the forces at play we are able to establish a commanding vantage point, a strategic position from which to win. GE is a good example. In order to get promoted at GE, you had to be an "A player" which required both real business results and valuing the managerial culture. But these were high abstract homilies. What really drove behavior was what Jack Welch valued: speed, flexibility, right actionable decisions, and a business with a commanding position to dominate the market. Managers had to demonstrate this in their behavior or they didn't read the real forces at play, no matter how successful they had been elsewhere. Those who couldn't deliver on these didn't get promoted and worse, didn't stay.

Let's not understate the point that successful managers know what they are up against, regardless of company statements to the contrary. After all, 60% of new executive hires do succeed. They 'do the math' and net things out really fast. They have the ability to see what's going on and not be innocently deluded by the hope and the hype.

How organizational leaders can help

What can organizational leaders do to improve the success rate of managers in new positions? Beyond a general orientation, they must provide the executive with internal support and an outside perspective to get to the root of things fast. This means immediately setting up an internal network of individuals who have their finger on the pulse. An outside perspective is essential because they may all be reading from the same script and won't see what they don't see. Setting things up right from the start will ensure that they have an objective assessment of the structural forces in play in the organization that will either hinder or help the manager move rapidly forward. It will provide a vantage point to create commanding strategies to take effective action. It isn't easy, but this leads to a profitable course of action and a return on their investment in the manager.

To your success

Confidence during times of transition is enhanced by having an accurate orientation from which to take action. The power of penetrating to the heart of the matter will position you not only to do an excellent job but also to create unique advantages, and at times, unexpected solutions. In both business and military endeavors the underdog defeats a much larger enemy by having a better strategy in relationship to the forces at play. If you want to accomplish solid results with a true economy of means, it is hard to argue against knowing specifically what is working for and against you on your way. No matter what your industry, or the size of your company, knowing this in a timely manner enables you to make your mark early on. It could also make the difference between being one of the 40% of failures or 60% of successes.

© 2004 Steven Feinberg, PhD and Jeffrey Arnold

See "Topgrading - How leading companies win by hiring, coaching, and keeping the best people", by Bradford D. Smart, Ph.D. chapter 3, (Prentice Hall Press, 1999)

Results of a study by the Center for Creative Leadership as cited by Michael Watkins." See Michael Watkins, "The First Ninety Days" ( Boston , Harvard Business School Press, 2003)

Structural conflicts are described in detail by Robert Fritz . See Robert Fritz "The Path of Least Resistance for Managers " (San Francisco, Berrett-Koehler Publishers, 1999)