Based on the results of a new study, you CHROs out there might want to start measuring the drapes in the CEO’s corner suite. The University of Michigan’s Dave Ulrich (whom we often feature as a source in our news and features) and Ellie Filler, a senior client partner in the Swiss office of executive-recruiter Korn Ferry, examined several sets of data pertaining to the C-suite and concluded that the executive whose traits were most similar to those of the CEO was the CHRO.
“This finding is very counter-intuitive — nobody would have predicted it,” Ulrich told the Harvard Business Review.
Based on their findings, Ulrich and Filler recommend that companies consider the CHRO when looking to fill the CEO position.
Of course, it shouldn’t be news to HRE readers that today’s CHROs are a far cry from the HR honchos of yore. Many report directly to the CEO, as Ulrich and Filler note. They often serve as the CEO’s key adviser and make frequent presentations to the board.
The data they examined to arrive at their conclusion included the salaries for CEO, COO, CFO, CMO and CIO. They wanted to determine the importance of the CHRO relative to other C-suite positions. They found that CHROs are the third-highest paid executives, second only to the CEO and COO, with an average base pay of $574,000. That’s 33-percent more than CMOs, the lowest-paid executives on the list.
Ulrich and Filler also studied proprietary assessments administered by Korn Ferry to C-suite candidates to uncover leadership traits. They examined scores on 14 aspects of leadership, grouped into three categories: leadership style, thinking style and emotional competency. They then assessed the prevalence of these traits among the different types of executives and compared the results.
Of course, not all CHROs would be good candidates for CEO, say Ulrich and Filler. Those who’ve spent their entire careers in HR, for example, probably won’t make it to the top. Instead, CHROs with well-rounded business experience, such as running a business division, have a much better chance of assuming the CEO mantle. They cite CEOs such as GM’s Mary Barra and Xerox’s Anne Mulcahy, who served from 2001 to 2009, as leaders who served stints overseeing HR.
In their white paper, Ulrich and Filler include testimony from CEOs who agree the CHRO could be a contender for their role.
“It’s almost impossible to achieve sustainable success without an outstanding CHRO,” Thomas Ebeling, former CEO of Novartis, told them. “[The CEO] should be a key sparring partner for a CEO on topics like talent development, team composition [and] managing culture.”