Yahoo learns difficult HR lesson over former CEO’s falsified credentials
Recent news about the ousting of Yahoo CEO Scott Thompson reminds us that hiring for integrity, trust and transparency can be just as difficult as hiring for initiative, intelligence and competence.
The plight of Thompson, who falsified his academic credentials, highlights the importance of employers hiring the right people with the right values.
Regrettably, behaviour such as Thompson’s is not new. However, given the ever-increasing transparency we operate in, it’s much more vulnerable to accountability.
One important take-away from this is the critical role that must be undertaken by HR. There are no second chances — we have to get it right the first time. Careful due diligence, comprehensive assessments and rigorous vetting must be the order of the day. The adage “short-term pain, long-term gain” comes to mind.
Not surprisingly, many job interviews rarely dig into a person’s record prior to her most recent positions. In this manner, like the pea under the mattress, historical oversights are compounded over time. Undue taking of credit, exaggerated positions of responsibility and, yes, fictitious credentials can easily slip through the cracks.
Additionally, those doing the hiring are often blind-sided due to a degree of over-enthusiasm regarding a potential hire. Furthermore, human nature provides us with a wonderful ability to believe what we want to believe. In Thompson’s case, the initial reaction internally was disbelief. “Scott is a forthright, no-nonsense, straightforward personality and a likable guy,” said one Yahoo director.
HR professionals are uniquely positioned and duly tasked to ensure hiring practices best support a firm’s sustainable, competitive advantage. In their book Execution: The Discipline of Getting Things Done, Ram Charan and Larry Bossidy argue the behaviour of an organization’s leaders is ultimately the behaviour of the organization.
Taken further, when hiring senior leaders, it is important to recognize their personal values and behaviours have the potential to impact the entire culture. As Bossidy said, “The ‘soft’ stuff — people’s beliefs and behaviours — is at least as important as the hard stuff, such as organizational structure, if not more so.”
Popular media often confuses nice-to-have versus must-have traits about what makes a successful leader. Sheetal Shah, a former venture capitalist and co-author of Venture Capitalist at Work, was recently quoted in a Tech Crunch article about what makes a successful entrepreneur: “The common perception is that you need to be hyper intelligent, have a big ego, be a visionary, experimental, focused and passionate. While these are all essential to the equation, the traits that really matter most are authenticity, integrity and motivation.”
How often do we see leaders emphasize nice-to-have over traits that really matter? The recent case involving Thompson illustrates the point. He was forced to resign after being in the job for only six months. The disproportionate impact of one person’s digressions on an entire organization cannot be ignored.
Strong leaders require an ethical framework of reference to be effective when they encounter difficult decisions and challenges. In the Yahoo example, how could employees stand by their leader after he was caught lying?
“How can I work for a company that has a CEO who claims to be a computer scientist when he’s not? I can’t work here if that’s true,” said a Yahoo engineer.
As we now know, the Yahoo board had no choice but to pull the plug on Thompson. We hope they and Thompson gained a greater appreciation for the role and responsibility HR has in the critical areas of recruitment, leadership development and succession planning.