- The National Association of Realtors has tapped an expert in association executive hires at search firm Heidrick & Struggles to help find NAR's new CEO.
- Based on the job description and the firm's research on what makes a top association executive, it looks like NAR is seeking a candidate with a great deal of experience in association or high-level management (though not necessarily in real estate) who's willing to build relationships with policymakers, members and the industry as a whole.
The recruiting firm tapped to find a COO for troubled CEO Travis Kalanick of Uber fame is the same company on the hunt for the National Association of Realtors’ (NAR’s) next CEO.
They are both high-profile hires: one unfolding publicly amid a messy human resources situation — and the other for a trade organization that’s in good shape but is seeking change and potentially new direction in a successor.
Bill Hudson is the Heidrick & Struggles senior advisor tasked with helping NAR find a new leader. The firm’s previous success stories have included placing Eric Schmidt at Google in 2001 as the chairman of the board of directors (he’s now the Alphabet executive chairman) and Satya Nadella as Microsoft’s new CEO. NAR’s managing director of media communications, Sara Wiskerchen, said the association interviewed four different firms before deciding on Heidrick & Struggles.
The association has hired a top-notch executive search firm (instead of a traditional real estate recruiter) and is using a partner with heavy association experience who’s based in Washington, D.C., indicating that NAR is looking for someone from outside the industry to fill the role — and possibly one with ties to the movers-and-shakers in the nation’s capitol. Here’s what readers should know about what to expect as the search rolls along.
Hiring an executive in general
Organizations like NAR bring in executive search firms because finding top talent can be expensive, time-consuming — and could result in a hire who doesn’t work out. Executive search firm Korn Ferry states in its brochure that 40 percent of new executives fail within the first 18 months.
“NAR’s leadership believes it takes expertise to identify the high caliber of candidates to run the National Association of Realtors and required the knowledge and skill of a national search firm,” said the chair of NAR’s CEO member search committee, Chris Polychron, in a statement. “A search of this significance requires the use of professionals who are highly skilled in locating and interviewing the best of the best, many of whom may be currently happily employed.”
Current CEO Dale Stinton has been with NAR for 36 years, taking the helm as the chief executive in November 2005.
“We look forward to serving NAR as partner for this critical leadership transition,” said Hudson in a press release when the search was announced in December. “Recognizing that NAR is one of the largest and most respected trade associations in the nation, we’re honored to be selected to lead the search for the new CEO.”
As Hudson noted, this isn’t just any hire — NAR is a well-known trade association, and speculation has been swarming about who might replace Stinton.
Hiring an association executive in particular
“H&S was selected as the result of an interview process conducted by the NAR member Search Committee,” stated Polychron. “In the judgment of the committee, H&S best understood the unique challenges of the CEO job and as such was best positioned to identify qualified candidates.”
Hudson, who’s heading the search, has a solid background in association management. “Mr. Hudson’s experience, training and expertise, is in the development, management and growth of associations both nationally and internationally,” reads his LinkedIn profile.
“He is well versed in identifying, understanding and addressing international opportunities, staff development, succession planning, culture shaping and more. Hudson has lead industry delegations to, lectured and consulted with countries around the world.”
Last year, Hudson co-authored a report for Heidrick & Struggles titled “Association CEOs: Leading Through Change,” which outlines some of the primary challenges that many association executives are facing today, how the role of association CEO has changed in the past three years, what the CEO-board relationship typically looks like and differences between how men and women, and CEOs of different tenure lengths, behave in their roles.
The report stated that more female CEOs than male CEOs say they focus on “industry or sector/reputation building,” and that more female CEOs reported turning to consultants and industry experts for decision-making support than male CEOs (who were more likely to report turning to a spouse).
It also noted that female CEOs were more likely than male CEOs to say that these three aspects of their positions had become easier (as opposed to harder or the same level of difficulty) over the years:
- “Leading a process that establishes annual goals, strategies, and action plans that are consistent with the vision and mission”
- “Being able to anticipate priorities, and ensure management focus and accountability around those priorities”
- “Being able to meet/exceed the social-media expectations as CEO”
The report found more differences between how new association CEOs and more experienced association CEOs operate. “CEOs with the shortest tenure and the longest tenure are least likely to turn to senior staff,” noted the report. “Those with the longest tenure (more than 15 years) are much less likely than CEOs with shorter tenure to turn to family or consultants, while those with the shortest tenure are most likely to turn to consultants.”
And areas of focus change with tenure, too, the report found.
“Those newest to the job are most likely to be focused on team building (as might be expected),” it stated. “We see a gradual lessening of focus on board management as CEO tenure increases — but it shoots up again when CEOs have served more than 15 years, possibly due to succession concerns as the longest-tenured association CEOs look to move on or retire.
“Finally, association CEOs with shorter tenure generally spend the least time engaging grassroots around public-policy issues, likely because they are still getting their feet under them in terms of staffing, board management, and so forth before reaching down into the membership and engaging.”
For the research, Heidrick & Struggles examined 525 survey responses (with both multiple-choice and open-ended questions) completed by association executives. The executives were drawn from a random sample provided by CEO Update, Heidrick & Struggles and Dr. David K. Rehr, who helped produce the report.
Hiring a CEO for NAR
In December, NAR announced that “a diverse member search committee” had been appointed to work with the search firm to recruit candidates. Chaired by Chris Polychron and vice-chaired by Cathy Whatley, the search committee solicited feedback from NAR members for what they’d like to see in a CEO before putting together the job description.
“Reporting to the President and the Board of Directors, the Chief Executive Officer will serve as NAR’s lead staff member and oversee annual revenues of over $200 million,” reads the description, which goes on to state that the association seeks someone from inside or outside the industry who’s “ready to help NAR tackle the trends, challenges and opportunities facing the real estate industry.”
According to NAR, those trends, challenges and opportunities include (but are not limited to):
- “the legislative landscape, including tax reform and advocacy components focusing on consumer and Realtor engagement”
- “disruptive technology influences”
- “growth of the NAR brand and the professionalism of its membership”
- “communication within and between levels of the association”
- “maintaining the relevance of the association, the industry and its membership”
“It is likely that the successful candidates will have strong prior experience leading a significant trade association, professional society, or other large and multipart business. Qualified candidates will likely possess a minimum of 15 years of relevant experience with at least ten years in executive positions,” adds the job description.
Further along, the description adds that the incoming CEO “must possess knowledge of current challenges facing membership organizations and/or association management and the broader corporate community.”
According to Hudson’s co-authored association report, the biggest reported “focus areas” for association executives, in descending order, were:
- Mission and organizational vision
- Membership outreach and retention
- Board management
- Financial oversight
- Advocacy efforts
The first two results (mission/vision and membership), according to the report, show that “association CEOs acknowledge the challenge of articulating their value proposition as well as the changing nature of the association’s role in the lives of members.
“People don’t join associations just for personal networking anymore; now they seek a demonstrable return on investment, either as a company or as an individual. To demonstrate that value, CEOs must increasingly nurture their relationships within the membership,” states the report.
According to the job description, the association is prioritizing “experience running a large and diverse organization in an industry evolving at an accelerated pace of change.”
The successful candidate, it continues, will have:
- “direct experience managing significant P&L [profit-and-loss] operations and advocacy efforts”
- “proven success interacting with a strategic Leadership Team and a large, broad based Board of Directors”
- “the ability to recruit and retain a high performing, diverse staff”
- “success in managing technology and social media”
In February, an independent Facebook group emerged to advocate for transparency to the CEO search process; formed by eXp managing broker Sunny Lake, NAR Girl Boss 2017 features profiles of potential candidates, discussions about the job description and other news items, and a community of real estate professionals interested in making sure the best person is hired for the job.
What kind of clues do we have so far?
The job description indicates that NAR would prefer someone with at least 15 years’ “relevant experience as a chief executive or senior level staff leader managing people or complex services.”
There is also a strong emphasis throughout the description on a well-networked, willing-to-network type of personality who can “balance her or his time between serving as an external representative and a spokesperson for the organization, board partner, and as an internal leader to senior leaders and staff.”
The CEO’s responsibilities would include a number of tasks and priorities, but at the top of the list is: “Raise visibility and awareness for the value of the Realtor profession, ensuring that NAR is ‘at the head of the table’ in regulatory and policy discussions at the local and national level.”
NAR also requests that applicants have “outstanding leadership, strategic planning, business development and interpersonal skills.”
Given Hudson’s research into successful association CEOs and how female CEOs in particular perform, there’s hope that the search will seriously consider some of the candidates put forward by the NAR Girl Boss 2017 participants.
The job description (and usage of an executive search firm to begin with) indicates that NAR is taking a serious look at candidates from outside the industry, too.
“The ideal candidate … will be an innovative leader who is passionate about her or his industry and will translate that passion into the real estate industry,” reads the description. “She or he must be willing to learn about the current and future issues facing Realtors, particularly those issues most important to NAR’s membership.”
Polychron noted that “there is still time for interested individuals to contact H&S at firstname.lastname@example.org.
“We are on schedule to have the new CEO in place for NAR’s Convention & Expo in Chicago in November 2017,” he added. Updates will be available at www.nar.realtor/about-nar.
Inman reached out to Bill Hudson and Heidrick & Struggles for an interview; the firm is declining media requests until a hire is made.