Being innovative may have been in vogue lately, but it has always been a staple of winning executives because to lead the industry is to define it. Leading is about driving change, to lead change means the rate of change in your organization not only has to be faster than the rate of change in the market, but it must be the fastest in the market. We are in a world where the lodestar for survival is to grow or die. CEOs must be innovative revenue generators and able to uncover where the net-net new sales can be found, or competitors will beat them to the punch. In a world where big is eating small and fast is killing slow, speed and innovation become key.
Delivering creative solutions and providing unique value both internally and externally is the hallmark of the top performer, so the senior executive must be able to deliver new and out-of-the-box ideas and solutions. The successful candidate in today’s environment must embrace new technologies and approaches and should also be so excited about the future of the industry that they would pounce on any opportunity to share their views and engage in a meaningful dialogue about where the industry is going. In contrast, the underperformer will view change as a threat and will find a dialogue about the future uncomfortable.
Here, it’s important to delve deeper and establish that innovation does not equate continuously purchasing the latest software and developing applications, and it quickly becomes clear why when we take a look at the banking sector: If you look at the websites of various banks, local and international, you will find that they offer the exact the same product. So while they are embracing technology, no innovation has been so significant that it has disrupted the banking sector yet Amazon disrupted the retail market, or Airbnb disrupted the hospitality sector. Moreover, while a bank’s CEO or CIO may be boasting innovative services, their customers are stuck at the airport, trying to call customer support to fix issues with their credit card, and only getting a “smart” automated responses that go into a maddening loop that pitches them housing and personal loans and new cards, none of which would be of any help to them.
So in a race to be the most innovative while essentially only succeeding in dividing the same traditional services into sub-products and endlessly complicating the customer experience, the banking sector seems to be heading into the perfect storm, for two reasons: First of all, banks are increasing supply to the point of overkill with fin-tech and banking services expanding both vertically and horizontally, when market share is limited. Second of all, the direction in which they are heading is not digital banking at all, it’s essentially launching an online business, which needs branding and online marketing, an area where banks have notoriously been the worst at. This dissonance, where many banks do not even have a branding and marketing department, relying instead on their head of investor relations, or their head of corporate communications essentially means that their situation is comparable to someone showing up to a Formula One race in a Honda civic, and have no hope of ever crossing the finish line.
With all this in mind, how can you navigate your executive search and be able to tell if candidates you come across possess sufficiently developed innovative skills to ensure that your organization is optimally poised to make leaps and bounds in your industry? Ask them the following questions:
- Describe an innovative product or service that you have created?
- Describe an innovation you created that increased net profit?
- Describe two new technologies that will revolutionize your industry.
- What are two new trends professionals in your function are embracing to be more effective in their position?
- How will the revenue spent in your market or niche change over the next five to ten years and how will your company respond to those changes?
- What changes are you going to make to your business to increase your customer value proposition?
- How will you improve your customer journey over the next five years?
- What innovations will you adapt to improve your customer experience?
- What processes and systems have you institutionalized in your company to drive innovation?
- How have you embraced innovation at your company and how will you ensure your products and services do not become obsolete?
The innovative candidate should become energized by these questions and will be so excited about the future of the industry that you will feel them bursting with excitement to share their views and engage in a meaningful dialogue about where the industry is going. In contrast, the underperformer will view change as a threat and will find a dialogue about the future uncomfortable. They will say things like, “These changes are a long way off. We still have time now. The business will not change that much in the coming years.” A rusted axiom to follow is to stay clear of CEO candidates who are not excited about the change.
Looking for more questions to ask a CEO? Read “CEO Assessment and Selection” to learn more about the 7 universal success factors for the Chief Executive Officer and unlock over 450 fail-safe questions that allow you to recruit top performers. Get more free CEO Assessment tips at https://tpgleadership.com/ceo-assessment-selection-book/ .