CEO Career Defining Moments and Talent Management
Determining the CEO’s career and legacy
How CEOs act and recruit are often seen as a result of so-called ‘career defining moments’. These events can shape their entire company’s approach to talent management, although perhaps not always in a good way.
Indeed, are there broader career defining moments and how can one event/experience shape or define the path someone takes to become CEO and/or how they act when they get there? So, this is an interesting topic and question.
CEOs make many decisions but clearly not all of the same import or carry the same weight. These range from the routine to the more significant and momentous or ‘defining moments’ in Steinbaum’s (2011) phrase.
CEOs make many decisions but clearly not all of the same import or carry the same weight.
It is these that are seen as possibly being able to determine the CEO’s career and legacy and the company’s trajectory/success! However, as Steinbaum (2011) correctly notes, ‘Sometimes you don’t know it’s your defining moment until you look back over your entire career. At other times you might know it immediately because it’s a result of a crisis or some monumental success’. That is an interesting perspective to take. It also seems that there is too much hindsight and hagiography of the ‘great leader’ in this topic.
It seems that there is lots of serendipity, luck and hindsight rather than rationality and ‘strategy’ here.
Sheer timing and ‘events’ play critical contextual roles. This can range from being made redundant and starting a family (see examples in Martin and Taube, 2014) seen as usefully giving ‘…a bigger picture view’ (Cole, 2014), to being washed away in the maelstrom of the 2008 global financial crisis – remember the end of formerly revered CEOs like Fred Goodwin at RBS, Dick Fuld at Lehman Brothers and others.
Sheer timing and ‘events’ play critical contextual roles.
Indeed, one only has to think of the example of Winston Churchill, the British Prime Minister whose leadership is often presented as having ‘saved’ the UK during the Second World War. Without that momentous event or career defining moment, he would be remembered very differently, perhaps even as a reactionary failure, rather than as the ‘Greatest Briton’ according to some polls.
Is there anything in common in these moments? It seems that the likelihood of moments occurring and ability to do this varies by CEOs in at least three ways:
Age/Career: Young vs Old
Sector: Manufacturing vs Hi-tech
Country: US/UK (individualism, external labour markets) vs Japan/Korea
(collectivism, internal labour markets)
Furthermore, we need to remember the following twin points.
First, the famous seminal work by Katz (1955) gave us a grid of needed skills that evolved over careers and time (see Figure). The career defining moments in each of these stages will then be different.
Second, in terms of the importance of career defining moments for talent management, a review of 40 years of research shows ‘…a pervasive tendency to react to perceived differences’ (Williams and O’Reilly, 1998: 121). We can explain these decisions theoretically from a range of disciplines, including sociology, psychology and management.
There is Contingency Theory, that what might work in one context may not in another. Then there is ‘Liability of Foreignness’ (Kindleberger, 1969; Hymer, 1976) and ideas of ‘semiotics’ with shared ‘codes’ and ‘semantic fit’, which are context-dependent (Brannen, 2004).
Creation of stereotypes
In terms of how people construct who is ‘similar’, Social Identity Theory (Tajfel and Turner, 1986) explains identity as derived from perceived membership of social groups. This may be the result of processes for recording and storing information that rely on cognitive shortcuts which create stereotypes or person prototypes that act as implicit expectations that influence how information is interpreted and remembered, as in Unconscious Bias Theory.
Such stereotyping is encouraged where there is:
1. ‘solo’ status among otherwise homogeneous groups, i.e., in jobs considered non-traditional for that group; and
2. ‘lack of fit’ between category and occupation. Indeed, Social Cognitive Theory (Bandura, 1986) sees human behaviour as an interaction of personal factors, behaviour and environment; so individuals do not simply respond to environmental influences, rather they actively seek and interpret information.
For the Homophiliy Principle (Lazarsfeld and Merton, 1954), Similarity-Attraction Theory (Berscheid and Walster, 1969; Byrne, 1971) and Relational Demography Theory (Pfeffer, 1983), we are seen to frequently select ‘similar others’ on the basis of commonalities in a range of demographic variables, which can be self-reinforcing in ‘inequality regimes’ (Acker, 2006) and with all the costs and consequences for talent management of bias, discrimination and missing talent that this might involve.
In sum, so-called career defining moments often suffer from post-hoc rationalisation. In terms of the consequences for talent management, it may result in the ‘more of the same’ and ‘mini-me’ phenomenon.
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Cole, S. (2014) ‘6 Women in Tech Describe their Defining Career Moments’, Fast Company.Com, Aug 25
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Martin. E. and Taube, A. (2014) ‘7 Successful People Describe the Decision that Changed their Careers Forever’, Business Insider, Nov. 19
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Sandberg, S. (2013) Lean In: Women, Work and the Will to Lead, W.H.Allen
Steinbaum, H. (2011) ‘Tough Calls: How 40 CEOS made their Career-Defining Decisions’, Knowledge at Wharton. Feb. 16
Steinbaum, H.; Steinbaum, M. & Conti, D. (2011) Tough Calls from the Corner Office: Top Business Leaders Reveal their Career-Defining Moments, Harper Collins
Tajfel, H. & Turner, J. (1986). The social identity theory of intergroup behavior in Worchel, S. & Austin, W.G. (editors) Psychology of intergroup relations, Nelson Hall, Chicago, IL, pp.7-24.
Williams, K.Y. & O’Reilly, C.A. (1998). Demography and diversity in organizations: A review of 40 years of research. Research in Organizational Behaviour, 20, 77-140.
Headline image courtesy Donald Cook@freeimages.com. Evolving Management Skills images are adapted from Katz (1955).