Don't judge too quickly -

When a company starts thinking about hiring and thereby replacing a General Counsel or Head of Legal, they often at some point in their brainstorming process ponder whether they should look internally or go external straight from the beginning.

Many companies will have policies in place anyway that will have the internal search as a mandatory step before (or parallel to) looking externally for the ideal candidate anyway. Much has been said about the advantages, challenges and risks. I’d like to draw your attention to some interesting thoughts and research results on the short and long term impact the hiring decision may have:

Harvard Business Review, a magazine I enjoy reading on a regular basis, has recently analysed the topic with a scientific angle looking at the short and long term impact at the CEO level. They’ve narrowed it down to the US health sector and have come to an interesting conclusion: “Results indicated that hospitals that hired outsiders had a one-time decline in relative efficiency and, in turn, were less competitive in the short term. But in subsequent years, those hospitals started to close the efficiency gap, surpassing the performance of hospitals that hired insiders”. Read the full article here

While I am actually a big fan of hiring internally (I will get to that in one of my next articles), there is an interesting (to some perhaps obvious) lesson learnt: don’t judge too quickly. Keeping HBR’s findings in mind, I would say regardless of whether you decide to hire externally or are promoting from within, be careful not to judge too quickly or expect everything to go smoothly right from the beginning. Same goes for the respective candidate. The external will need to get a proper feel for the company and the internal will have to adjust and transition from a colleague into the manager role. Changes in leadership are tough for the individual and the team and will have an impact on the business in one way or another, regardless of how experienced the new Head of Legal is or how smoothly business has been running in the past.