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Traits of top leaders - Claudio Fernandez-Araoz

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Claudio Fernandez-Araoz's new book

Claudio Fernandez-Araoz's new book

Claudio Fernandez-Araoz's new book

Few people know more about global leadership than Claudio Fernandez-Araoz.

The Buenos Aires-based senior adviser at search firm Egon Zehnder is a favourite of CEOs and business schools around the world for his sharp instincts.

He's spoken about Great People Decisions, his first book, to audiences at Harvard, Amazon, and the World Business Forum. In his new one, called It's Not the How or the What but the Who (Harvard Business Review Press), Fernandez-Araoz focuses on "potential" as the next wave of talent-spotting

Companies, he says, need to focus less on people's competencies when filling a job and more on the qualities that will let them pivot with the times.

That's especially critical when picking someone for a CEO role, he argues. The world is simply too fickle and fast-moving these days to know what any job will require.

"You have to start with the right mindset," says Fernandez-Araoz. "The skills that make you successful today might not be so important tomorrow."

That said, he argues that the current focus on "high-potential" employees is misguided.

One problem is that the label is reserved for younger people coming up the career ladder. If you're not dubbed high-potential by the age of 40, forget it.

More important, those labelled as high-potential are more often highly competent in a certain set of skills. They've been measured by what they've done, instead of how or why they've done it.

Fernandez-Araoz says companies should instead hire based on five indicators of a person's potential: motivation, curiosity, insight, engagement, and determination.

To him, motivation is less about someone's scope of ambition than his or her desire to have an impact.

"Selfish people never make great leaders," he says.

Determined leaders are resilient, he says. They know how to get around obstacles and recover quickly from failure. They take on tough assignments and adapt as markets change.

Companies might hang on to their designated stars with more pay and perks, but the risk-takers who see ideas shot down and opportunities squashed will move on.

One of the biggest mistakes that employers make is assuming potential is only found in younger, less experienced people.

Some of the best future leaders may be the quirkiest, least "ambitious" people in an organisation.

"A lot of great leaders don't start out wanting to become one," says Fernandez-Araoz.

It's Not the How or the What but the Who

Claudio Fernandez-Araoz

Indo Business