The discovery led Filler and Ulrich to a provocative prescription: More companies should consider CHROs when looking to fill the CEO position. The surprising result: The traits of CHROs matched up closely with those of CEOs. The researchers analyzed 360-degree assessments of thousands of leaders in six C-suite functions-CEO, CFO, COO, CIO, CHRO, and CMO-in which each executive was ranked on 14 aspects of leadership on a scale from one to seven. “This finding is very counterintuitive-nobody would have predicted it,” Ulrich says. Their conclusion: Except for the COO (whose role and responsibilities often overlap with the CEO’s), the executive whose traits were most similar to those of the CEO was the CHRO.
The researchers then assessed the prevalence of these traits among the different types of executives and compared the results. They examined scores on 14 aspects of leadership, grouped into three categories: leadership style, or how executives behave and want to be perceived in group settings thinking style, or how they approach situations in private and emotional competency, or how they deal with such things as ambiguity, pressure, and risk taking. The researchers also studied proprietary assessments administered by Korn Ferry to C-suite candidates over more than a decade. “Great CHROs are very highly paid because they’re very hard to find,” Ulrich says. But CHROs are next, with an average base pay of $574,000-33% more than CMOs, the lowest earners on the list. No surprise: CEOs and COOs are the highest-paid executives. Then they averaged the annual base compensation of each group. To identify the best performers, they found the top decile of earners in each role. In looking at several sets of data, they found surprising evidence of the increasing responsibility and potential of CHROs.įirst, in order to understand the importance of the CHRO relative to other C-suite positions, including CEO, COO, CFO, CMO, and CIO, Filler and Ulrich looked at salaries. To investigate the CHRO role within the C-suite, Filler worked with Dave Ulrich, a University of Michigan professor and a leading consultant on organization and talent issues. “It’s moved away from a support or administrative function to become much more of a game changer and the person who enables the business strategy.” “This role is gaining importance like never before,” Filler says. And when companies search for new CHROs, many now focus on higher-level leadership abilities and strategy implementation skills. Today, she says, they often report directly to the CEO, serve as the CEO’s key adviser, and make frequent presentations to the board.
For years many of the HR chiefs she recruited reported to the COO or the CFO and complained that they lacked real influence in the C-suite. Filler, a senior client partner in the Swiss office of the executive recruiting firm Korn Ferry, specializes in placing chief human resources officers (CHROs) with global companies. But over the past 15 years Ellie Filler has noticed a dramatic change. For decades the corporate HR department was seen as a back-office function, a cost center focused on mundane administrative tasks such as managing compensation and benefits plans.
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