Companies often go to great lengths to refine strategy, optimise operations, or pursue acquisitions. Yet one of the most overlooked threats to enterprise value comes from within: poor internal leadership placements. These hidden missteps not only slow performance but quietly erode morale, culture, and competitive advantage.
While external hiring decisions typically receive scrutiny and structure, internal executive appointments often bypass formal evaluation. That is where some of the costliest and most enduring mistakes occur, yet few organisations confront this issue directly.
This article explores why internal placements so often go wrong, what is really at stake, and how to improve this critical decision-making process.
Why Do Internal Placements Fail So Often, and Why Are They So Damaging?
- Decisions made by only a few: CEO-led or board-driven choices often exclude broader stakeholder input, limiting constructive challenge or discussion.
- Hasty, instinct-led selections: Many placements happen quickly, driven by gut feeling rather than thorough analysis or preparation.
- Lack of accountability: When an internal hire underperforms, those responsible for the decision rarely face consequences.
- Short-term cost savings: Redeploying underutilised executives may appear efficient, but the long-term costs of a poor fit can be severe.
- Difficult-to-measure consequences: Cultural erosion, leadership friction, and lost momentum are hard to quantify but deeply damaging.
It is no surprise that miscast leaders often fail. For example, executives with strong analytical skills and attention to detail—effective at streamlining processes and driving efficiencies—may struggle in roles that demand innovative strategy in fast-changing industries. Yet many CEOs and investors continue to rely on favoured candidates, assuming past performance will guarantee future success. This assumption often leads them to overlook critical factors such as personality, cultural fit, motivation, and other attributes essential to success.
It is alarming how frequently these mismatches occur, and how little is done to prevent them. When someone attempts to challenge these appointments, they are often without the tools, authority, or support needed to intervene effectively.
