To match private equity firms and executives, block out the noise

Private equity firms are seemingly always on the lookout for high-quality C-level executives, more so than most organizations because they have multiple companies in their portfolios all seeking to find ways to grow or transform.

As a result, when private equity firms acquire companies, they tend to change a significant portion of the management team.

They look for opportunities to improve the company’s operation and financial performance, which are closely tied to company leadership. They know what they want in their leadership and need the search process to move quickly to find the right fit.

“Finding the right person to lead these companies is so critical because shareholders are expecting a return on investment within a certain timeframe,” says Baillie Parker, a Partner at ON Partners. “They may need the right person to turn around a company that’s in distress, or they may need someone to rapidly drive growth. A private equity firm’s success is directly tied to the person leading the company.”

Smart Business spoke with Parker about how private equity firms can increase their chances of finding the right executive.

What, generally, are private equity firms looking for in executive candidates? What challenges does that pose?
Candidates who understand what it means to work with private equity firms are most desirable. It’s even better if they’ve led a private equity backed company through a successful liquidity event. Experience accessing and executing strategic acquisitions are sought-after traits.

Private equity firms expect candidates to move quickly, which can be dangerous. They want decisive leaders, but they also need someone who listens and has experience developing a strategic plan once consensus is gained.

In some cases, candidates are chosen more for their leadership DNA than specific industry experience.
Firms may recruit a CEO that’s new to that industry, which means they need to understand new products, services, or the market in general from the ground up.

The downside to the sense of urgency that is inherent in these hires is the new executives often make assumptions about what they need to do, they have goals and a timeframe in which to achieve them, and then they run on those assumptions from the start without a full understanding of the people, products or customers.

How can private equity firms increase their chances of success in this capacity given their unique hiring/search process and candidate criteria?
Both the search process and vetting need to be thorough. Historical behavior is a good indicator of how someone will perform in future. However, it takes expert assessment to separate what’s real and what’s noise — determining the impact the candidate actually had on the business versus a candidate coming from a company that was successful regardless of the candidate’s contribution.

Similarly, excellent candidates that make positive contributions may have the misfortune of being at the helm of a company during a tough market. Separating that out is critical. A company must be able to balance the candidate’s experience with the other data points to get the whole picture. All of this can be verified through reference checks early in the process.

Some of the important vetting questions are: Does the executive hire well when building leadership teams? Have people they know recruited them? And does their team follow them when they move on to the next opportunity — good leaders can bring a team with them.

The challenge in finding the best candidate, someone who can thrive, is being able to look across all the important traits to get a sense of the candidate’s ability to function in such a unique environment. Private equity firms have very specific goals and outcomes that they need their executives to accomplish. These firms have a strong grasp of the financial side of companies, but they’re not operating experts. They’re relying on their executives to run their businesses.

It takes experience to find the right hire for these unique situations. Search firms have worked extensively with private equity firms, know what they’re looking for, and have a database of candidates that have operated in these situations. They can be an important part of a private equity firm’s ability to realize returns.

Insights Executive Search is brought to you by ON Partners

Culture, employee experience and how HR is (re)defining them

The Human Resources function is changing. As the talent landscape shifts and millennials come to define the workforce, the traditional tenants of HR are adapting to this generation’s imperatives.

“How HR meets these new experiential and philosophical demands will play a material role in a company’s long-term innovation, trajectory and success,” says Bryan Buck, a partner at ON Partners.

Smart Business spoke with Buck about the changing role of HR and how it shapes hiring efficacy, culture and engagement.

What are the essential functions within HR departments? How has that changed?
Traditional HR functions still play a critical role — compensation and benefits, talent acquisition and management, learning and development, etc. What’s different now is the awareness and emphasis on company culture; defining what a company stands for and shaping the employee experience.

Today’s HR is challenged to create an environment in which the best employees can do their best work and be their best selves, both in and out of the office.

What is HR’s role when it comes to hiring and employee retention?
HR is adopting more of a marketing role; where the employer brand is as important as the products or services provided. More often than not, the perception of brand, culture and experience is shaped before a candidate walks through the door.

There will always be a company willing to pay more. Understanding what matters to your employees beyond compensation and delivering experiences that meet their desires and needs is a company’s best tool when competing for the best talent. It’s important to first know their drivers and passions.

To be clear, it needs to be more than just ‘food truck Fridays’ or ‘unlimited’ vacation days. Perhaps it’s a quarterly stipend where every employee can reimburse general wellness expenses regardless of the benefactor.

Or maybe it’s giving employees seven years to exercise their options once they’ve left the company because unhappy employees who stay only for the equity vest are toxic to your cultural health.

How can companies measure employee engagement and use that information to improve hiring and retention practices?
Companies are using analytics to find and attract the best talent who are also like-minded to their current population. Now more than ever, organizations are seeking purpose-driven top talent, not just those who are coin-operated.

Coin-operated employees are loyal until a better offer comes along. A purpose-driven base has bought in to the company’s culture and vision; being heard, having impact, and making a difference at work, at home and in the community. Attracting the latter requires different assessment tools focused around ongoing understanding and engagement.

These insights can also be used to identify at-risk talent. Leveraging consistent data points to recognize this profile — what groups they sit in, which projects they work on, the type of leader they work for — can help you uncover trends, adapt and keep the best top talent from leaving.

The Holy Grail is to have alignment between your business, culture and people strategies. Doing so creates an environment of higher productivity, greater sense of purpose and increased employee longevity. From micro-touch points to real-time temperature checks, analytics is playing a growing role in all of it. It’s streamlining the science of attraction and engagement, and reducing the probability of a costly bad hire.

What are some key elements of a quality hiring and retention program?
It starts by focusing internally. Companies must first understand their culture and people, and create a meaningful employee value proposition on that foundation. This document should naturally align the business, brand and culture. Then starts the process of identifying the best, right talent, which incorporates a more discerning candidate profile and search strategy.

The best people on paper aren’t always the best fit. That’s where analytics and a strong hiring process come in. It’s critical to know how to assess the skills and personality traits that translate to an effective hire. Build a culture and experience around your existing best talent, and the like-minded will follow.

Insights Executive Search is brought to you by ON Partners

An executive candidate’s cultural fit can determine success or failure

Culture fit is a major factor when determining success or failure for new hires at every level, particularly at the executive level.

Someone who is a good fit to a company’s culture is typically given a longer runway to prove his or her capabilities when joining a new company. A person who does not align with a corporate culture, regardless of skills and capabilities, will not get the same latitude.

Misalignment of culture leads to organizational rejection and they are allowed to struggle until they leave or get fired. That is why determining culture fit during the interview process and a well-crafted onboarding process are critical steps in getting newly hired executives indoctrinated.

Smart Business spoke with Matt Mooney, a partner at ON Partners, about the importance of culture and how interviews and onboarding can be used to ensure new hires hit the ground running.

How can a company, through its search and interview process, determine how well a candidate will fit within the company’s culture?

There is a formal approach and an informal approach to determining culture. The formal approach incorporates psychometric testing and behavioral interviewing to determine how candidates fit with corporate values. Candidates who do not match the established corporate profile have a tougher time getting through the hiring process, regardless of experience or skills.

Other companies rely on soft skills, or intuition when assessing a candidate. While there is a place for this informal approach, it is not scientific, scalable, or easy to replicate, which makes it harder to apply to larger companies.

What do assessments include and how can that information help with onboarding?

A well-structured assessment is a valuable piece of the candidate interview process. Used to measure intellectual capabilities, behavioral norms and tendencies, assessments combined with interviews and references provide a more complete picture of what makes candidates tick.

Unfortunately, companies often obsess over assessment data prior to hiring, but do not use it when onboarding the executive. Smart companies will consult the assessment data in the weeks and months after an executive starts to better facilitate a smooth transition and assimilation into the business.

In what ways does onboarding differ when applied to executives versus employees?

When onboarding an executive, the process needs to be more structured and thoughtful than it is for lower-level employees. The executive onboarding process cannot just be part of the first day orientation. It should be a series of conversations and meetings that take place over the first three to four months of employment.

It is more involved, more collaborative and offers the new executive feedback and coaching through a two-way, constructive dialogue. Even the most self-aware executives may not tune into the nuances of a company’s culture. A well-constructed onboarding process helps with that transition.

How much does onboarding matter? What impact does it have for a company and its employees?

Companies that embrace onboarding tend to put more thought into human capital and have a well-rounded program that explores all aspects of that investment, such as retention and employee engagement. Those companies that put a premium on human capital have a significant advantage in a market that is short on top talent.

Consider onboarding as maintenance on a major investment. Companies spend tremendous time and energy hiring a great executive. They collect significant data that is needed to show they have made the right hire, so it is smart to use every resource available to optimize that hire and ensure success.

New executive hires typically have 100 days of latitude when joining a company — the honeymoon period. If that is squandered because the new hire missed nuances of the company’s culture, he or she loses good will and momentum that could have been used to make a greater impact on the company.

Insights Executive Search is brought to you by ON Partners

How to choose the right CFO for your company

CFOs, at their core, are and have always been responsible for a company’s finances. Today, however, there’s a great deal more they need to understand and be capable of delivering.

“The expectation is that the CFO is a backstop for the CEO,” says Lenny Vairo, a partner at ON Partners. “Their expertise is needed to think like a CEO and help make strategic decisions. CFOs with strategic chops who can help steer the company are in high demand.”

Soft skills were once a perk for a role that had been equated to being the most senior finance executive. But now they’re a must-have trait.

“The ability to nurture and build relationships is critical for today’s CFOs,” says Larry Ormsby, a partner at ON Partners. “In businesses that are characterized by rapid growth, the seemingly perpetual onboarding of new employees and either Wall Street or Private Equity financing means relationships need to be established quickly so trust and cohesiveness can be formed.”

Smart Business spoke with Vairo and Ormsby about the skills and traits companies should consider in a CFO.

What are the critical characteristics found most often in successful CFOs?
Generally, the primary trait of any highly effective CFO is the ability to get things done. Time is an enemy, so incoming CFOs need to quickly make their mark on operations and, in some instances, sales.

CFOs must ensure the company has bench strength. Not having the personnel capable of dealing with the unexpected can be a significant setback. Building bench strength doesn’t necessarily involve hiring more people.

It means ensuring that those who are with the company are the most capable for their positions and external partners are well qualified and on demand. This also goes a long way in terms of succession planning.

There’s a lot of pressure today to do more with less, so execution is critical. An increasingly important trait, then, is the ability to leverage technology to improve efficiency. CEOs, especially as virtual workplaces proliferate, want a CFO that can connect employees and business processes through technology.

What commonly creates conflict between a CFO and the company for which he or she works?
Credibility is likely the most important trait of a CFO. When making a presentation, they must be able to handle tough questions, such as forecasts and assumptions. CFOs may feel confident in their numbers, but questions coming from different angles can cause them to fumble and lose the perception of credibility.

This is a skill that first-time CFOs need to master. They don’t need to have the answer to each question necessarily, but they need to be composed and capable of really understanding the relevancy of the question when responding.

Often internal politics and relationship struggles can undermine a CFO, especially if they’re not personable. Actively developing a healthy, trusting relationship with all members of the C-suite is critical to both the CFO’s and the company’s success.

What must CFOs get right when they join a company?
Certainly they need to be adept at execution, planning and repeatable processes, and need to be on their game when it comes to deliverables, leaving no room for surprises.

There’s also the first 90-days aspect — the ability to get people in the hallways talking about them in a positive way. While that’s not to diminish the skills of a CFO versus their ability to win a popularity contest, it must be recognized that a person’s perceived fit is essential to his or her ability to function in an executive role.

CFOs should quickly identify what they can bring to the table that was missing in the company before their hire. Maybe that’s fixing balance sheet or tax issues, or making better hires. Whatever it is, getting some early wins helps a lot.

The new bar for an effective CFO is high and each company needs something different from their CFO. Before making that hire, it’s important companies discuss exactly the critical, core traits needed for someone in that role. Don’t compromise. Otherwise, companies can expect to struggle trying to fit a square peg into a round hole.

Insights Executive Search is brought to you by ON Partners

Attention to detail is critical for candidates exploring executive roles

The hiring market for executives is robust in select industries. There seems to be more opportunities than there are candidates to fill them, which has led many candidates to make rudimentary mistakes that eliminate them from consideration.

“Don’t be a ‘lazy’ executive candidate,” says Brad Westveld, a partner at ON Partners. “The job market is strong, but don’t take that for granted. The candidates who are the most prepared and come to interviews with ‘original thoughts’ will have no trouble standing out from the pack.”

“While it’s not necessary to study the company’s most recent 10-K line by line, candidates must understand the business before meeting with a hiring manager,” says Daniel Bolger, a director at ON Partners.

Smart Business spoke with Westveld and Bolger about common mistakes executive candidates make when applying for a position, and the advantages of working with a recruiting firm.

What must executive candidates do to properly prepare for an interview?
Do some basic research. Review the company’s website to understand its products, the markets where it has a presence, basic financials and stock performance, and some of its most recent press releases.

Know who you are meeting. Review executive bios and LinkedIn profiles, particularly the leader making the hire, and get to know their background and experience.

Know the analysts covering the industry and the company. What are they forecasting? What challenges are present in the market at large?

Show genuine interest in the role, even if you are lukewarm on the company or the opportunity. Candidates risk being knocked out of the process when the hiring manager feels that they’re not interested.

Be prepared with a handful of well-thought-out, open-ended questions. Explore the vision of the company and demonstrate some level of relevant and real-time knowledge.

What should candidates understand about recruiters?
Candidates should first understand the recruiter’s business model. Executive search firms represent the company. This is their first priority. They are headhunters, plain and simple. They work a strategy that their clients dictate.

Recruiters have specific markets that they service. Know your recruiter. Don’t call or blindly send a resume to a health care recruiter if you are looking for a semiconductor role.

Understand that each executive recruiter is focused on their current clients and relative assignments. Stay close with appropriate and relevant recruiters and trust they will call when the right role comes up.

Those in the market for a new job should, however, always be open to talking with recruiters when they call.

What’s the advantage for executive candidates of taking a call from a search firm that’s looking to fill open positions?
A search firm can help set candidates apart. Client companies rely on search firms to sort through the minutia of candidates and offer an opinion on which are the best.

Recruiters have personal and targeted conversations with candidates that are specific to the position they’re being asked to fill, so having that detailed conversation with the executive recruiter helps candidates prepare.

The recruiters are also talking with the client hiring manager, and are able to convey what they know about the company and the position back to the candidate, giving them an advantage over those candidates working from the outside.

When in doubt, remember the basic rule of applying for a job: Be prepared. Just 30 minutes of preparation will improve your opportunity to stand out among the crowd. ●

Insights Executive Search is brought to you by ON Partners

How to structure competitive executive compensation packages

Finding great candidates to fill executive positions is inherently difficult. Though quality candidates can be found, companies tend to lose their top pick because they can’t meet a candidate’s compensation expectations.

“Companies often enter into an executive search intending to construct a competitive compensation package for the right candidate,” says Tim Conti, managing partner at ON Partners. “But when it comes time to make an offer, the hiring company balks because an overly generous offer could disrupt the internal equity of compensation packages. That logic is irrelevant to the candidate.”

He says too often hiring companies hope they’ll find a candidate who loves the opportunity so much they’ll take the job regardless of compensation. That rarely happens, which is why companies need to be more realistic about executive compensation before setting out on their candidate search.

Smart Business spoke with Conti about structuring competitive executive compensation packages.

What are executive candidates looking for in terms of compensation?
There are benefit items that can be meaningful, such as 401(k) matches, but for executives the benefits package alone won’t seal it. Executive candidates often want to share in the company’s success and reap the returns generated by their own achievements. They’re looking at total compensation, which includes the base salary, incentives and equity.

How can employers create a compensation package that works for everyone involved?
Fundamentally, employers must ask themselves if they’re truly trying to attract best-in-class talent, which is expensive. Does the company really want a change agent? It’s not likely to get one if after asking itself difficult questions it prioritizes maintaining the internal pay equity of the current peer group over spending what it takes to make an impactful hire.

Companies should ask themselves if they must stay within a predefined range, or extend themselves to compensate the talented outliers. If it’s the latter, be mindful of the candidates’ pressure points. Some candidates want a stable, dependable base salary while others want a strong equity position. Every candidate is different.

When in the interview process should compensation be discussed?
The compensation conversation, 90 percent of the time, is tackled too late in the process. When a company has engaged a great candidate it’s important to know the candidate’s compensation expectations in the first two weeks. That’s typically after an initial interview when it’s clear both parties are interested in each other.

If working with a recruiter, the compensation discussion should start very early in the process with the recruiter obtaining a very detailed compensation history from the candidate. Compensation discussions should advance in parallel with the interview process so that expectations for both parties can be understood. This transparency gives both sides the best chance to figure out how to bridge any gaps that become apparent.

What can companies that might not have the ability to pay a large salary do to create a strong compensation package?
In addition to annual target bonuses, strong compensation packages often include management-by-objective bonuses rather than goals based solely on the financial performance of a business unit or company.

Progressive companies bridge pay gaps with sign-on bonuses paid out over time, for instance breaking a $100,000 sign-on bonus into $25,000 payouts each quarter. That often helps to preserve internal salary ranges while still generating the compensation necessary to hire the candidate.

Equity grants — in the form of restricted stock units or options — are also a valuable means of attracting top candidates. Equity grants align the interest of the candidate and the company since equity value tends to move in concert with company performance.

The best talent is expensive, regardless of how the compensation package is structured. To attract top talent, the hiring company cannot rigidly adhere to its own internal compensation ranges. Doing so severely limits the caliber of candidates it is able to attract. ●

Insights Executive Search is brought to you by ON Partners

Executive searches require a strong plan and partner to succeed

An executive search generally takes 120 days from start to finish. There are, however, circumstances that could add another 60 to 90 days to the process.

“Whether an executive search is anticipated, to fill an expected opening for instance, or is needed to replace an unexpected opening has a big impact on the process,” says Andrew Hickman, a partner at ON Partners.

“However, there is always an urgency associated with a paid search, which is why establishing a timeline and a process of evaluation upfront is essential.”

Smart Business spoke with Hickman about getting the most out of an executive search process in the shortest possible time.

What expectations might companies have about an executive search that could be detrimental to the process?
A search firm’s goal from the outset is to understand the dynamics of the situation, then manage expectations based on that. There are natural time extenders that get introduced in a search, some of which can be mitigated.

However, the process is always never fast enough in the eyes of some companies, especially those that believe the search will take as long as recruitment for lower-rung employees.

Companies are paying for a search firm’s speed, efficiency and market knowledge, and expect that to equate to a very fast hire. Much of a search firm’s work is done in the first 45 days. The rest is contingent on the schedules of others — managing interview cycles and reacting to each candidate’s timing, etc. can extend the process.

Again, it’s up to the search firm to set realistic expectations upfront.

What is involved in an executive search process that may require it to take longer than a company might expect?
Companies that don’t have the position’s role defined, and skill and experience requirements determined will inevitably add time to the process.

There are strategic reasons to leave ambiguity in the description — a role may be upgraded, two positions are combined or perhaps it’s a new position for the company — so some companies will begin broadly and reassess as they review prospective candidates.

But more often uncertainty is behind that approach, which results in meandering, poor potential initial matches resulting in a longer search process.

Candidates, in many ways, dictate the length of a search. The best candidate may be unwilling to leave a position until an equity event occurs, bonus is paid, etc.

Travel can be an impediment, but coordinating schedules upfront can help speed up the process. Search firms can help clients travel to meet candidates where they are based, use Skype technology to conduct interviews, etc.

What are the risks in rushing an executive search?

Anytime a senior hire is rushed it introduces the risk of making the wrong hire. The costs are high to redo a search when someone in that role fails.

Cutting corners also means not fully exploring the market or not fully vetting candidates, which can lead to missing or glossing over candidates’ red flags. It can also mean missing a better candidate that could have been found if more patience was applied.

How do experienced executive search firms dictate the process?
It’s incumbent on the search firm to establish trust and a high level of engagement with the client from the start. There must be direct, expedited communication between the client and firm when reviewing profiles and providing candidate/client interview feedback. This can help identify and address search time delays when they surface, and even anticipate them beforehand.

Time-based milestones should be set early and client schedules should be pre-coordinated so that the necessary stakeholders can meet with candidates.

A validated candidate profile is essential. It gives clarity to what’s being sought, and the certainty it provides saves time.

Everyone in an executive search wants it to be done quickly and successfully. Searches are tough. Make the commitment to the process upfront and stick to it, and the outcome will be a great hire. ●

Insights Executive Search is brought to you by ON Partners.

Chief Digital Officers are leading the charge for change amid disruption

Chief Digital Officer (CDO) is not a new position, but the role is becoming mainstream, reaching into and impacting many arms of many businesses.

“CDOs are rooted in technology, and their roles are predicated on leveraging data and utilizing the Internet and the cloud to drive transformation,” says John Barrett, a partner at ON Partners. “But it’s the softer skills that are essential to the position.”

CDOs, he says, are skilled communicators who can help companies define their future in an era of disruption. They’re able to connect ideas and people while creating consensus around the need for change.

Smart Business spoke with Barrett about CDOs — when they’re needed, what they do and why their goal should be to work themselves out of a job.

What is the role of a CDO?
CDOs help create positive change and transformation at companies. They look to the future and facilitate the changes within companies that are necessary to get there with speed and efficiency.

The trend of hiring CDOs is not new, but the position’s proliferation has accelerated over the past several years. The impact of technology can be felt in companies in far-ranging industries, and some of the world’s largest businesses are seeing that any industry can be disrupted. They’re realizing they’re vulnerable, and unless they adapt, are unprepared for what the future holds.

Who should and shouldn’t have a CDO?
Companies that are most in need are those that are late to the digital game but are becoming paranoid of technology and its imminent disruption. If a company recognizes that they are unprepared to deal with technological changes, they should make the investment to hire a CDO. However, companies that are already fairly sophisticated in the way they utilize technology and the Internet probably don’t need a CDO.

How should a CDO be integrated into a business from an organizational standpoint?
CDOs are brought in or promoted and championed by the CEO. They have an equal seat at the table with an organizational understanding that they have been mandated to drive positive change.

What traits are common in good CDOs?
A good CDO can drive strategy and be a good connector, the latter of which is job No. 1. They connect ideas and people inside the company and with change agents outside the company. They understand the industry ecosystem, and can connect the organization to new startups or investments.

They ultimately must show they can drive revenue or help save money. In that sense they’re connected to tangible outcomes.

In the first dot-com wave in the late 1990s, many companies made the mistake of trying to change too much too fast. That often led to failed investments in technology as well as widespread cultural rejection. The lesson learned is that modern CDOs need to strike a careful balance between pushing for disruptive change while respecting and acknowledging the history and capabilities that exist in an organization.

What should companies look for when hiring a CDO?
CDOs should have a high emotional IQ, be a great connector of ideas and people, a compelling communicator and strong leader. They should be humble, not assuming they can walk in the door with all the answers. And they can’t be afraid to work themselves out of a job in five years.

When the company becomes digitally sophisticated and digital technologies are integrated into the organization fabric, a CDO isn’t needed.

In terms of hard skills, find someone with a proven track record of leveraging technology to create disruptive change. Consider former CTOs, former general managers, CEOs of technology companies or CIOs that have led companies through disruptive digital change. CDOs often come to companies as an outsider, though there are instances in which they’ve been promoted from within.

The decision of whether to hire a CDO comes down to the CEO’s ability to create a vision for the future. Is the company ready for the inevitable disruption technology will have on it and its industry? If the answer is no, a CDO can help define that future and ready the organization for change. ●

Insights Executive Search is brought to you by ON Partners

Creating and maintaining a successful client/search consultant relationship

Search consultants are brought in to help companies strengthen some aspect of their business with a critical executive hire.

With so much at stake, hiring candidates for these positions takes an expert approach.

“A search consultant is an extension of the hiring company in the market,” says Baillie Parker, a partner at ON Partners. “That’s why it’s important the consultant understands the drivers of a business, its strategy, challenges and competitive landscape as the company looks to hire the right fit for an executive position.”

“The candidates a search consultant will approach are likely already making positive contributions to their respective companies,” says John Coutts, a partner at ON Partners. “The more informed a consultant is about the hiring company and the position that needs to be filled, the more positive the impact the consultant will have on the potential candidate pool.”

Smart Business spoke with Parker and Coutts about how to facilitate a good relationship with a search consultant to land a top candidate for a position.

What are the keys to establishing and maintaining a good relationship with a search consultant throughout the hiring process?
It’s important that the consultant understands the drivers of the business, its strategy, challenges, competitive landscape and its culture to get a sense of the working environment.

That’s best accomplished by a meeting between the search consultant and the company stakeholders directly involved in the hiring decision. In this meeting, the company can clearly map out the short- and long-term challenges the executive should expect to encounter in his or her role.

The search consultant’s primary responsibility is to listen to the hiring company and understand the criteria it has for the position, why that’s the case and how that criterion relates to the business.

Stakeholder and decision-maker input will be used to create a position profile and search strategy, which will define what the company wants and guide how the search is executed. This can only be accomplished with clear, honest and direct communication.

What is the role of the hiring company once the search process is underway?
Executive hires are mission critical, so the search consultant needs to penetrate the market and identify strong candidates quickly.

Early feedback helps the hiring company calibrate what it’s looking for. As competition for top candidates increases, search consultants must move faster than ever to fill open positions. That requires accuracy and transparency from the outset.

Why is open and honest communication so important?
Once engaged, the search consultant becomes an arm of the company that’s reaching out into the market.

When conducting senior-level searches to reach high-profile candidates, it’s important that the search consultant positions the company and the role correctly because the first approach sets the tone.

Establishing a good relationship with the candidates is essential to a successful hiring process. That can lead to getting input from the candidate pool regarding the opinion the market has of the company.

The consultant’s interactions with potential executive candidates should be handled with a great deal of sensitivity because if they don’t accept the position, they could potentially become an important client of the company down the road.

In what ways can the search process be derailed by a poor employer/search consultant relationship?
Once the search consultant begins to identify candidates, it’s important that the hiring company schedules interviews on a timely basis. Scheduling delays can derail the process, so viable candidates must be presented to stakeholders quickly.

If the search consultant and hiring company aren’t in sync, it means lost time and too many treks down the wrong paths. That results in significant setbacks and is why communication, trust and honesty are critical to the process.

The fit between the consultant and the hiring company must be strong. A unified team is the only way to have success. ●

Insights Executive Search is brought to you by ON Partners.

Hard vs. soft skills

In an environment in which many employers are unable to find candidates with the right skills and experience for the job, cultural fit is, perhaps surprisingly, a major factor in the best hiring decisions.

“Making a bad hire is costly to an organization,” says Lenny Vairo, a partner at ON Partners. “The more senior the role of the new hire, the bigger the potential negative impact if it is a poor fit.”

He says employers need to look at the gradation between soft and hard skills.

“Companies might be able to get away with a less-than-perfect fit if the flaws are coachable in a way that may be positively affected during onboarding, or the personality concerns are such that they can be managed around. But if the candidate’s flaws are rigid, don’t make that hire.”

Smart Business spoke with Vairo to understand the role cultural fit plays in an organization and how to find candidates who match a company’s culture.

Is it always a fit with the company’s current culture that’s desired?
Not necessarily. For instance, there are some companies that would say they don’t have a performance culture — people are not accountable for getting things done, and bonuses are given despite failure.

In these cases, there’s a desired future state that’s being hired to. The executive level is the tier at which a company can begin to change the culture.

How important is cultural fit compared to hard skills?
Experience, skills and competencies are very important. But if the cultural fit is wrong, it’s a flawed hire and won’t work.

Problems of cultural fit typically relate to how people get things done.

If they don’t get the team involved, are poor communicators, don’t listen, or don’t influence others positively, then it’s a costly hire regardless of the person’s impressive education, professional pedigree or hard skills.

How does a company’s stage affect its culture and what constitutes a cultural fit?
It comes down to a company’s self-awareness.

As a company moves through its lifecycle, it will be clear what kind of talent is needed at which stage. As a startup, for instance, individuality and heroics pay off — working until midnight every day of the week.

So the company would need someone prepared to make that sacrifice. In an emerging growth company, where efficiency of scale and operational discipline is critical, a more collaborative, communicative and inspiring leader may be most effective.

How can employers gauge a candidate’s cultural fit?
Fit is when a candidate’s personality and the company’s culture match.

To recognize this, a company has to be self aware, which means understanding the level of inclusiveness, collaboration, patience and accountability it expects, as well as how it expects its employees to respond to failure.

That self-awareness is the predicate on which a list of desired traits can be built. With that, the next step is to design interview questions that seek to uncover whether or not a person has exemplified or exercised those traits.

That’s best illustrated by understanding the candidate’s contribution in his or her previous positions and with detailed examples of how he or she faced and navigated adversity.

What does a bad fit do to the culture of an organization?
The more senior the role, the bigger the risk of a negative impact from a poor fit. Executives affect a lot of functions, which means an organization can stall and regress with the wrong leadership.

With a good fit, there is a confluence of likeability and performance. Many times cultural fit hinges on communication style and manner of execution. These candidates are often those who, in previous positions, have been well-respected leaders and promoted continually.

It’s important, however, not to fall in love with a candidate’s professional pedigree.

Take the time to make sure the person is a good cultural fit. Companies can’t train personality. But someone who has worked in a variety of cultures, however, may be able to adjust with some help in the onboarding process.

It comes back to a company’s self-awareness and ability to ask the right questions to gauge whether or not a person can adapt and flourish in your company. ●

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