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Do Your Leaders Have 'Executive Intelligence'?

June 1, 2007
This skill is the single most predictive component of professional success.

In his new book, "Executive Intelligence: What All Great Leaders Have," Dr. Justin Menkes explains how companies can improve performance and profitability by taking a more scientific and systematic approach to hiring and promoting human talent. By focusing on a company's core competitive advantage -- its people -- businesses can finally deliver what differentiates the most successful organizations from the rest.

Justin Menkes is the founder and managing director of the Executive Intelligence Group and works with the world's top corporations to help identify and develop great leadership.

The following is a discussion based on the principles of his book.

We have heard many times that businesses suffer from a critical shortage of highly-skilled executives to fill their ranks. Yet, hiring and promotion decisions still seem to yield hit-or-miss, inconsistent results. What are companies doing wrong?

Quite simply, businesses are failing to look for and measure the skills that predict executive success; the most notably overlooked skill being Executive Intelligence. Research has shown that one's level of skill in this area is the single most predictive component of professional success --- better than any other ability, trait, or even job experience. Yet, too often, managers are selected because of their likeability, presence, or charisma.

Think about the typical hiring process. Most companies review a resume to determine if they will meet with a candidate. They then conduct in-person interviews, and attempt some reference checking. What it typically comes down to, however, is whether the decision-maker "likes" the candidate personally, and thinks that his or her personality will be a good fit. But liking someone during a job interview is a very hit-or-miss way of choosing talent, little better than flipping a coin.

A sound hiring process can take much of the guesswork out of the equation. For instance, few companies have candidates demonstrate their skills. While they commit considerable time to asking questions about a person's past experience, they never test the accuracy of these claims by watching them actually perform. For instance, if you wanted to know how well a person plays basketball, you can review their historical statistics. But no competent NBA manager would hire a player without actually watching them play the game. In sports, the tryout has been universally accepted, yet in a business setting, we almost never do this.

You stated that executive intelligence is the biggest single predictor of executive success -- but what do subjects like math and reading proficiency have to do with being skilled at business?

There is a common misconception that the word intelligence means IQ. But IQ is nothing more than a measure of the specific skills needed for academic success. The skills required for success in business are very different, and can be broken down into three categories: accomplishing tasks, working with other people and evaluating yourself.

For instance, regarding tasks, we frequently hear how essential it is for someone to think "outside the box," but what actually determines one's facility for doing so? In other words, what skills make someone a creative thinker? Typically, creative thinkers can view issues from multiple perspectives, define problems in several different ways and anticipate likely obstacles. Someone's aptitude for these skills determines how well he or she will perform as a creative thinker.

Or, we often say that someone has exceptional political or social savvy, but what specific skills allow these people to handle interpersonal situations so effectively? Typically, socially skilled people are exceptional at recognizing underlying agendas, anticipating the probable effects and likely unintended consequences of a chosen course of action and they understand how those involved will likely react. These specific capabilities determine one's "people smarts."

The point is that companies must start to focus on and evaluate the relevant skills for business success. The good news is that these evaluations can be readily built, and can be used to provide invaluable insights, and talent benchmarks for an entire organization.

Well it's easy to understand how looking for executive skill is necessary in an analysis-dependant business like investment banking, but how is this concept relevant and important in a manufacturing setting?

It doesn't matter in what industry or country a business is located. Those with highly skilled people do better. So whether you are asking people to identify inefficiencies in a production line or asking them to create an innovative product, the core skills needed to do so are all determined by one's level of executive intelligence.

Particularly as companies grow and spread decision-making responsibility across a larger pool of people, businesses need skilled executives dispersed throughout organizations. What is more, everyone's performance is enhanced or limited by the quality of the talent surrounding them. Individuals with high executive intelligence cannot reach their potential unless surrounded by others with a similar level of skill. In large part, any businesses' success is determined by how well it demands and rewards smart decision-making, but the first step is making smarter decisions in selecting our people in the first place.

Justin Menkes is managing director of the Executive Intelligence Group, which is partnered with Spencer Stuart, to help identify, hire, and promote exceptional leaders and managers throughout the world. He has been cited by Malcolm Gladwell in The New Yorker for his work on hiring practices and earned a Ph.D. in organizational behavior from Claremont Graduate University, where he studied under the late Peter Drucker. He has an M.A. in psychology from the University of Pennsylvania and a B.A. from Haverford College.

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