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Leadership
Hiring Right for Culture Fit
August 14th, 2024 by Amy Suitterby Bill Benson and Jeff McGraw
If you are looking to hire individuals who will thrive in your organization, they need to have an environment that complements their style and approach to work. The gravity of culture fit becomes increasingly important when hiring leaders and is paramount if that leader is in an executive role.
Organizations will sometimes hire a new leader to adapt a culture. We often see this post-acquisition or during instances of ownership transitions. Organizations that need to change their culture due to market conditions or competitive pressure will need to consider several risk factors when approaching the change.
Failing to Consider Culture in Hiring Has Consequences
Owners, boards and top executives often favor attributes that lean toward their aspirations or a desired future rather than understanding who will successfully lead the current organization. Companies can be enamored by a person’s credentials or specific industry experience rather than a more holistic understanding of the candidate. These risk factors include the following areas:
Underestimating the Resistance to Change: Not fully understanding how current values, leadership styles and practices will react to a new approach. This can impact the effectiveness and performance of the new executive.
Misalignment of Expectations: Ownership and the new executive have conflict because they are not aligned fully on pace, methods and outcomes of changing culture. This falls into the category of “be careful what you asked for.”
Neglecting Employee Input and Ignoring Existing Strengths: This will lead to trust and morale issues which may result in losing your best employees. Listening and building upon strengths in addition to addressing needed areas of change will be more effective.
Lack of Communication: Failing to communicate the reasons for change and the role everyone will play in the change process, including the new executive, can be a critical failure point. Over-communicating needs to be the practice.
Lack of Support: Let’s assume you fully understand the factors involved in hiring your change agent. Failing to give the new executive the backing, support and time needed will hinder their ability to be successful. (See: Misalignment of Expectations.)
Understand Your Current Culture
The following diagram offered up by Harvard Business Review, and Spencer Stuart, offers 8 different organization cultures.
Lee Hecht Harrison does an excellent job giving examples and describing how these eight culture factors impact leadership activities in this article.
Hiring Right for Culture Fit: A Good Recipe to Follow
Vision and Values: Alignment in this area will ensure decisions and strategies that reflect the company’s core principles and lead to a more cohesive direction.
Leadership Style and Influence: A leadership style that aligns with the culture will resonate with and more effectively influence, motivate and retain employees.
Change Management: An executive aligned with the culture will be better equipped to lead seamless change.
Decision-Making: Culture fit influences decision making processes. The right fit will lead to someone making decisions that fit the values and be more sustainable in the long run.
Collaboration and Team Dynamics: Aligned leaders will create more harmony and an environment that is more innovative and efficient.
Brand and Reputation: Misalignment often leads to turnover and can additionally impact customer and investor satisfaction.
Long-Term Success: The right culture fit will ensure long-term success through continuity and consistent leadership.
Incorporating the right hiring specification which includes intangible “fit factors” along with effective behavioral and conversational interviews, assessments and references, are critical in identifying and selecting the candidate who will be most successful.
Check out another blog article we have on culture fit here.
Can we help you find a candidate that’s a good culture fit? Contact us.
Hiring for Private Equity
January 21st, 2021 by Amy SuitterHiring for Private Equity
9 critical factors for CEOs or CFOs
By Bill Benson
The difference between winning and losing often comes down to having the right players on the team. Private equity firms have significant skin in the game and are acutely aware of the need to hire the right executives for their portfolio companies. PEG firms will typically prefer a candidate who has been part of a private equity grow and sell transaction. Candidates who have this experience are increasingly hard to find. It will likely be necessary to consider candidates who have relatable experience and the right intangibles. Here are 9 essential candidate qualities to consider when vetting your C-level executive for private equity.
1. Motivation – You need a driven candidate with a large motor to tackle the challenge and lead organization to a finish line. Money can and should be a huge motivating factor. The person who has been through repetitive sales exits may not be as motivated as someone looking for their first big win. This is not a fit for someone seeking work life balance as a priority.
2. Team Leadership – This is not an individual sport. It is critical for a team to work together to accomplish the mountain of work associated with building a platform or growth company. The right candidate will be confident without being arrogant. They will listen, ask questions and be genuine during the interview.
3. Transparent – The CEO and CFO are critical links in a flow of information. Withholding information or hiding problems will undermine confidence with sponsors and investors within the PE environment.
4. Smart – Intelligence on its own is not a guarantee of success. You will however need someone who can verbally and mentally hang with whip smart investors and equity partners. The person will need to have critical thinking capability. IQ needs to be combined with common sense and EQ. Sorry if screening by intelligence offends the egalitarians out there. PE is not an “everyone gets a ribbon” environment.
5. Temperance and resilience – It takes a level of patience, self-confidence, and open-mindedness to be highly functioning within this dynamic, team-oriented environment. Making sound decisions quickly and under pressure requires the person who can stay present during chaos. The right candidate cannot be thin skinned, easily agitated or intellectually rigid. Having failed or experienced significant challenges should not be considered a sign of weakness. Things will never go exactly as planned so you want someone who has experienced adversity. It is key to understand how they reacted to challenges they have faced.
6. Systems and Data Thinker – In a growth company environment, the leader needs to envision the company in the next state and put the building blocks in place to get there quickly. This person is often replacing an entrepreneur who did not have this capability. Having a combination of experience in larger environments as well as growth companies, is a good under pinning. More important is a person’s ability to lead by more than the strength of their personality. The right candidate will use data to make decisions, create repeatable processes and integrate with the right systems to support both the short- and long-term goals.
7. Shirtsleeve – Senior leaders in middle market PE growth companies will spend a percent of their time being “hands-on”. This is a key consideration if you are considering a corporate executive for a PE leadership role. This person will need to be ready to “zoom in” and “zoom out” to gain that hands-on understanding of progress to goal across the organization. Being able to both execute and create strategy is not part of every leader’s DNA. Many prefer to sit at a more strategic level. It is critical for someone moving from corporate to private equity to be prepared for a less cushy and resource laden environment. Being prepared to regularly communicate a “hands-on”, detailed understanding of the organization to investors will be required.
8. Bias for Action – Choose urgency over process or empathy. The clock is often ticking toward a time frame to sell. This creates a heightened expectation around the speed of growth or cost cutting. This person will need to be collaborative and be transparent with decisions. They will need to listen and show concern for employees but also make decisions quickly and backed with data not feelings. Some highly empathetic leaders who might thrive in some environments, may not be able to make decisions as urgently as the PE owned business requires.
9. Decision Maker – We have discussed that PE firms value urgency and data. It is also important that the leader can make decisions without all the information and under challenging circumstances. Often these decisions are shrouded with urgency, ambiguity, complexity and/or volatility. This requires using a combination of intuition and facts along with a mind that is open and agile. A good rule of thumb is articulated by the US Marine Corps which they call the ‘‘The 70% Solution’. This is used for warfare and combat situations, but it also applies to business.
How to Hire Better Talent
November 23rd, 2020 by Amy SuitterHow To Hire Better Talent
Selecting the Right Candidate
Successfully finding and hiring the best people is largely based on selecting the right candidate during a hiring process. We often see postings with a laundry list of requirements relating to very specific experiences, industries or even technical requirements such as software skills. These items are typically taken right off the job description. This leads to the assumption that someone who checks all the boxes or has performed a similar role will be the best person to hire. Why is this likely the wrong approach? Let’s consider these six options.
1. What are the odds that the perfect “experience” candidate is also the best potential performer? Even if the candidate that checks all the boxes is out there, it would be like arranging the moon and the stars for that person to also be the best performer or talent available. It is very often not the case.
2. Often the job description does not address what you are looking for the person to accomplish. Make a list of desired outcomes for the prospective hire. This provides a better screening guideline.
3. What factors do you consider when you promote someone from within? Do you look at years of experience and check lists of requirements or do you consider their performance? Why not look at the same factors for external candidates?
4. You want to expand the field of candidates, not limit it. The best candidates typically evolve out of a larger pool, rather than a limited one. Despite the pandemic, we are still in a talent short market, and painting yourself into a corner with a long list of requirements will not help you hire the best person.
5. Don’t “fall in love” with a particular attribute or experience. E.g. Worked for a specific competitor or company, degree from a certain school, or other singular “WOW” factor. These biases or perceptions often have little to do with actual performance.
6. Finally, don’t disqualify a great candidate because of a particular factor. Just because you had a bad experience hiring someone from a certain company or with a certain background, it doesn’t mean that it applies to all candidates with that attribute. We all have a tendency to project our past issues forward, but it is important to stay objective and be open-minded, so we aren’t screening out someone that may be a great fit.