Why organizations prefer their next CEO from HR background?

Updated: Jul 09, 2018 UTC
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As times are moving, HR is moving ahead in terms of having value and importance in an organization. As earlier, HR was looked as only a back office department and a cost centre for a company who do only administrative tasks; today it is seen sitting for the board meetings along with the directors. Most of the HR professionals who join the organizations as CHROs often found to report directly to the CEOs and CFOs of the company and make all the important presentations to the board. Now, when the organizations are in the need of hiring HR people for higher positions, they look for the high-level leadership qualities and the skills to implement strategies for business success. In today’s scenario, the trend is getting changed and now HR leader positions are lookout as game changers rather than just a support and administrative function.

Looking at various available sets of data and statistics, it is found that HR leaders are getting increased responsibilities and status in an organization. The main leadership qualities that are examined for taking final decisions to hire an HR professional as CEO fall under these three categories.

Leadership Style: When organizations look for candidates for higher positions like CEO of the company, there must be a great set of leadership skills who can lead not only a team or a department but a company as a whole. It shows how the executives behave in the particular situations and like to be perceived in various group settings. A CEO with HR background holds a strong command over the leadership qualities and understanding the situations, so it becomes a wise decision for an organization to take an HR for the roles like of CEOs.

Thinking Style: The thinking style of the leaders of an organization puts a great influence on the decisions and strategies they adopt. So, when you know and believe that HR professional’s thinking process revolves around people where their clients are company employees and keeping them happy and satisfy is all they care about; it is a wise decision to take them as CEO who will keep your clients in mind for each and every strategy and policy.

Emotional Competency: The emotional factor is always there in HR personnel that would be great to have on board where the CEOs always need to deal with pressure, risk-taking, and ambiguity. The command on the emotional stability can lead an organization towards success maintaining healthy relationships with clients, shareholders, and board of directors.

How can HR prepare themselves for the position of CEO?

-          Handful experience attracting the perfect talent, building healthy culture, and forming the right organizational structure

-          Keep an eye to move ahead on the career path to reach CEO position and hence have a broader managerial experience handling P&L responsibilities and developmental strategies

-          The challenge for HR professionals is to gain sufficient financial and technical skills in their early education and throughout their career steps as an HR

If few pieces of research are to be believed, 42% of high-performing CHROs are female. Hence, if we take the steps of taking CHROs to CEO level in a serious way, we will have a drastic increase in the number of female CEOs in Indian Organizations. It is only 5% of female CEOs as of today in the Fortune 500 companies. Even the CEOs of most of the successful companies believe that the success is not at all possible without having valuable opinions of their outstanding CHROs.

Succession to CEO position needs a certain balance of people and technical skills. For the C-suite roles or even one position down that, you need to shift your leadership style from softer one to the business acumen, technical skills being just a beginning point.    

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