The Ready Market for Your "Not Ready" Leaders
In a recent webinar for engineering executives, I opened with a quick look at the labor market before getting into the five leadership transitions. In the chat box, one attendee wrote that the same pattern holds in custom battery pack manufacturing, for operations and quality leaders.
Here is the picture. A large group of senior leaders in engineering businesses is retiring now or will retire soon. Early-career engineers can be hired. It takes work, and it is happening across the industry.
The problem is the person in the middle.
Many of the people in that middle layer are being told, one way or another, that they are not ready. Few of them are being told what to do about it. Outside the firm, plenty of people are happy to tell them something different.
Solid platinum: the engineer with ten to fifteen years in
A project manager or program manager with ten to fifteen years of engineering experience is solid platinum.
These people run your largest projects and programs. Clients know them by name. They know how the firm actually works. Your succession plan assumes they will be running parts of the business in five years.
The data on how thin that layer is has been around for a while. The ACEC Research Institute found that 42 percent of engineering firm staff have fewer than ten years of experience. In the ACEC and FMI survey of A&E firm owners, 84 percent called management succession planning important. Just 13 percent had formal plans for key mid-level employees.
So the industry agrees the middle matters. Few firms have a written plan for the people in it.
Then add the hiring market. Hiring a newly graduated engineer is not that difficult. Hiring the 10-15 year engineer who has technical skills, client-facing experience, and leadership bandwidth is next to impossible. Every firm in the region wants them.
None of the firms I work with can afford to lose even one of these people.
What "not ready" sounds like to the person hearing it
Senior executives often have a strong gut feel about this. That guy is good. I like him. He is just not ready for an executive role.
The gut feel is often right. The trouble is what reaches the person.
Sometimes nothing reaches them. They watch a promotion go to someone else and fill in the reason themselves. Sometimes they get a sentence in a review. Be more strategic. Work on your executive presence.
Feedback like that describes the end result. It says nothing about what to change.
Look at it from the engineer's side. This is a person who has spent fifteen years solving hard problems by isolating the variables and getting to the root cause. Give them a defined problem and they will dig in. A conclusion with no variables gives them nothing to work on.
Some of them respond by working harder but not necessarily smarter. Others decide the firm has made up its mind about them and become open to listening to outside offers.
Both groups should worry the CEO and CHRO of A&E consulting firms. Sooner or later, both groups will start taking recruiters' calls.
Twenty years of recruiting calls taught me who picks up
For twenty years before I turned to executive coaching full time, I ran a retained executive search firm. I jokingly describe myself today as a recovering headhunter.
So I sent a lot of the InMails and made a lot of the calls that your best people are getting right now.
Recruiters do not find these people by accident. Good recruiters target firms that do similar work to their clients or employers. The names are not hard to find. I assure you that your 10-15 year engineers are on those lists and receiving those contacts. That is happening like it or not.
The question is whether your people are responding to those contacts or ignoring them.
When an engineering leader likes their manager, finds their work challenging, believes they are being paid fairly and is confident in their future with your firm, they are not prime recruiting targets. But a leader who has been passed over or told they are “not ready” reacts to those recruiting calls very differently. The recruiter is offering them the ego gratification of being contacted, the chance to make more money and an opportunity to “get to the next level,” the very thing your firm is denying them.
Sometimes the move works out for the leader and sometimes it doesn’t. Occasionally the firm is better off without them. But an engineer with 10-15 years of solid experience is usually a big loss. Your firm spent years investing in that person, and that investment and their institutional knowledge walk out the door with them.
The replacement math on a project manager you cannot hire back
With the departure of a program or project manager, the firm now needs a replacement, if one can be found. Wharton research by Matthew Bidwell found that external hires were paid roughly 18 to 20 percent more than people promoted into the same jobs. They received lower performance ratings for their first two years. They also left at higher rates. The study was done in banking. Anyone who has brought a senior outsider into an engineering business will recognize the pattern anyway.
The new person also has to learn what the old one knew. Which clients want a phone call before the email. Which project engineers can be trusted with which decisions. How work actually gets won at this firm. None of that comes on a resume.
Some of the client relationships may go too. Zweig Group found that 89 percent of AEC firms rely on seller-doers. Seventy percent of them say clients prefer to deal with the people doing the work. When the seller-doer leaves, the client has a reason to look around.
Then there is the bench. The engineer who left was probably somebody's successor. That plan now has a hole in it. Usually the senior leader who was supposed to hand off ends up staying longer than anyone intended.
These costs land in different budgets, so nobody adds them up. Put them side by side and a real development plan for the person who is still there looks like a bargain.
Turn the verdict into a plan before someone else makes an offer
Engineers need a problem to solve. The fix starts there.
"Not ready" is a conclusion. It is not a diagnosis. The job is to get from one to the other while the leader is still in the building.
In the webinar I walked through five transitions that decide who is ready for an executive role:
Scoring touchdowns versus field goals
Delegating ownership versus delegating tasks
Making recommendations versus providing analysis
Leading across the business as well as up and down
Expanding the pie versus protecting your turf
Most leaders do not need all five. Pick the one or two that stand between this person and the next role. Name them. Then tell the leader.
That conversation is the part firms skip. Telling a strong performer exactly what is missing feels uncomfortable. For an engineer it is the most useful thing a senior leader can say, because it turns a verdict into something they can work on.
They hear a second message in it too. The firm thinks they are worth the effort.
That second message matters for retention. A leader with a clear problem to solve and a senior person backing them has a reason to let the recruiter's call go to voicemail.
Who on your team has heard "not ready" this year?
Think about the leaders in your firm with ten to fifteen years of experience who have been passed over or told to wait.
Pick two or three. In a short conversation we can work out which transitions are in the way for each of them and what each one should work on next.
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