Study shows that a lack of interpersonal skills keeps many new executives from successfully transitioning into their new roles.

Despite strong technical know-how and years of previous management experience, nearly one in three externally hired executives and one in five executives hired from within are not performing as well as expected, after two years in the position. The culprit: poor interpersonal skills, according to a new study by the Institute for Executive Development and Alexcel, an alliance of executive coaches and talent management consultants.

"Underperformance is about the lack of interpersonal and leadership skills, such as the ability to build relationships, collaborate, and influence," notes the report. More than 320 executives and talent professionals across a variety of companies and industries completed the online study, which also included in-depth interviews.

The study found that by the second year, 27 percent of external hires at the senior level had left the organization; for internal transfers, the rate was 23 percent. According to the study, these rates have remained about the same for the last two years.

In addition to the lack of interpersonal skills (75 percent), other cited reasons for executive downfalls included systemic or structural problems and inconsistencies within the organization (28 percent), goal conflict between executive and the organization (23 percent), and poor assignment by organization of executive to new role (23 percent).

"It's the interpersonal area that is the biggest opportunity," says Patricia Wheeler, chair of the study for Alexcel. "The most important work we can do is to help those leaders craft a plan for training internally, working with an outside consultant, or creating a mix of both outside and internal resources."

"When an executive placement fails, the financial losses are extreme," adds Barbara McMahon, managing director of the study for Alexcel. "Other costs include the loss of time and

efficiency when a function is left unfilled and finally, the potential loss of employee morale."

The study found that executive hires benefit most from mentoring or informal buddy systems, customized assimilation plans that target individual needs and specific requirements of the position, and executive coaching.

The good news is that during the Great Recession, organizations did not decrease their support for executive transitions. In 2010, 64 percent of organizations provided a moderate or high level of support for internal transfers, and 74 percent provided a moderate or high level of support for external hires, which Wheeler says has been at the same level for the last four years.

There are cost-effective ways that organizations can help support executives in their transitions, notes Wheeler. IED and Alexcel recommend the following:

  • Create an onboarding team of line managers, HR executives, learning and development professionals, and a mentor to support the new executive through a multistep process.
  • Clarify who is responsible for onboarding the new executive.
  • Focus on mentoring - make sure it is structured and supported.
  • Create customized plans that are targeted to individual needs and requirements.
  • Encourage executives to form an advisory panel of personal colleagues and peers.