Decades of Exec Evaluation boiled to Five Key Points
As startup directors, we are often responsible for very key hires, ranging from chief exec to board chair to contributing insight on senior management team selection and more. My venture firm Touchstone Innovations has worked closely for years with Peloton’s Chris Reichhelm, an executive search consultant who, in my own portfolio of five companies, has conducted 6 searches over the past four years including 3 CEOs and 2 additional board directors. We enjoy working with Chris because he has decades of experience, both in international firms (Heidrick & Struggles) as well as focused boutiques but mostly because he provides exceptional insight on the likely effectiveness of an executive, well beyond their paper track record and history. In his own words:
“For the first 10 years of my career, I focused on the CV and background as the lead indicator of capability at executive levels. But as I tracked the success of my placements, I found a few characteristics that were more indicative of success than the person’s background. These led me to re-evaluate my approach and I now prioritise the search for these qualities during my assessments."
Here are those key five qualities, why they matter and how to assess in an interview.
Ability to deal effectively with failure. It’s about not taking things personally, learning and moving on; remaining galvanized and failing forward. Lots of great thought leadership on this topic from Stanford Professor Carol Dweck (her book Mindset is my all-time favourite book).
How do you test for it?: “When was the last time you failed to meet a sales target? A product release date? A technology milestone? Talk about it. How did people react? What did your investors say? What about the rest of the Board? Whose fault was it? What did you do to rectify it?” Being specific and closed with the questions helps to prevent hyperbole.
Really engaging storyteller
This ability to create and tell stories is critical to motivating a team, engaging colleagues and “selling” the company to investors and the broader community. Great storytellers become that way by drafting and rehearsing their stories hundreds and hundreds of times. What’s more, they have different versions depending on their audience. Company leaders need to be great storytellers, regardless of audience.
How to test for it?: “Pretend I’m a potential client. Present and sell your solution to me.” Alternatively, you could try the very simple “Tell me about your company”.
Egoless (or self-less) leadership
This is about prioritising the needs of the company over and above personal needs. This doesn’t mean that these leaders aren’t interested in generating wealth for themselves – far from it! It means that they know the route to generating serious wealth comes from prioritising the needs of the business over their own personal gain. Strange as it may seem, when executives do this they stand a better chance to generating wealth for themselves and for the company. It is a rare quality, described as a Level 5 leader in Jim Collins book Good to Great
How to test for it?: Listen to their approach to team development. Who do they award the plaudits to? What about the blame? What is their view on mentoring or development? Are they in service to the company or is the company in service to them?
Architect of Culture and Motivation
51% of US employees are not engaged in their work, according to a Gallup poll. There may be a ‘War for Talent’ but there’s also a ‘Crisis in Leadership’. Executives must get better at motivating and engaging their teams. To succeed, they must become ‘Cultural Architects’, individuals who create environments where people want to do great work.
Intrinsic motivation is the level of motivation forged at a much deeper level than stock options and benefits. This happens when there an environment where employees feel safe to be themselves, where they feel really connected with their colleagues, where they feel they’re able to be masters of their domain without being micromanaged, and where they feel they’re contributing to a programme that benefits the wider community.
How to test for it?: Don’t ask them. Talk to 5 – 7 individuals who have worked for them. ‘What was it like working for X?’ How productive did you feel?’ ‘How motivated were you to come in every day?’ How motivated do you feel your colleagues were?’ ‘What was the environment like?’
Thought Diversity and Challenge
There has been a lot of talk about the benefits of diversity. In young companies, this is important. Entrepreneurs can wrap themselves in a bubble if they’re not careful. Having individuals who think differently and aren’t afraid to speak up, in an environment that encourages them to speak up, strengthens the company. It makes it more robust. It questions assumptions and occasionally threatens sacred cows. These are good things.
How to test for it?: “When was the last time you were wrong? Who questions you in your team? On your Board? When was the last time you went with what someone else wanted to do, rather than what you wanted to do?” “ “In your company (so far / last company), who have you selected to advise you and why?”
While Chris still measures experience carefully, he believes that these qualities represent better indicators for likely success. Of course, much also depends on the organisations into which executives are being recruited. Just because someone was successful in their last organisation, doesn’t mean they’re going to be successful in their new company. Other environmental factors, like culture, matter just as much, maybe even more.
I find his assessment extremely helpful and now apply it not only to executive and director interviewing assessments but also in entrepreneur evaluation for potential investments. As such I have created one addition based on my own experiences for successful and scalable startup executives:
Sharp Focus: Prioritize then Delegate and/or Get it Done
Startup executives are pulled in so many directions that focus and prioritization, or lack thereof, is cited as one of the top three reasons that startups succeed and fail. Great executives set the priorities and then hire well – often better than themselves – and empower through effective delegation. They also drive items to completion and make sure things get done.
How to test for it?: “Who did you hire around you in your last role and how did you use them?” “As an executive how do you decide which business opportunities to pursue or not? Have you ever ‘fired’ a customer or partner and how did you make the decision?” “How do you handle it when you have too many things pulling at your time?”
These combine to form a strong litmus test for effective leadership and especially leadership potential in younger executives and directors. Helpfully they can be remembered with the acronym: G-R-E-A-T for the core five, with the sixth leading to the GREATS! We hope this list is helpful and feel free to provide feedback by filing the form here, with any additional useful interview questions and/or key qualities from your experiences!