Harmonics

Building a strong performing leadership team can take time. However, for a private equity-backed business, they often don’t have the luxury of time. In this guest blog, Kevin Murphy sets out four guiding principles to building a senior leadership team for a PE backed business. At the speed at which larger and more established organisations are changing, I believe some of the principles would serve many CEO’s who are under pressure to deliver immediate results. Finally, as a member of Ireland Smart Ageing Exchange (ISAX), I’m delighted to see Kevin highlighting the ‘reverse ageism principle’. Hope you enjoy the read, John.

 

When looking at building a senior leadership team for a PE backed business, it’s hugely different from that of a plc or large corporate. From my experience, a PE backed business typically has a timeline of 3 to 5 years to deliver significant results for the PE fund. Accordingly the leadership team, and the hiring CEO, must develop and deliver strong business results quickly.

Whenever I joined as CEO of a business, one of the first things I would do is assess the existing management structure to ascertain if adjustments were necessary to turn the performance of the business around, or to push a successful business to achieve greater returns. I generally use a few firm principles to guide me and these are broadly as follows:

Don’t compromise and be ruthless if necessary

There can be no hesitation or compromise to ensure you build the strongest performing teams. I believe it’s crucial to wait for the right person; it’s all about getting the right people you need to achieve business goals. If not, it will come back to haunt you and cause you unnecessary issues later on.

If you inherit a team, then it may be the case that this team is not structured or built with the right skills to enable you to carry out the activities required by the business. The growth of the business simply requires bringing in fresh team members who have the necessary vision and skills.

In this situation, you need to make the hard calls. If people lack the right skills or cannot do the job, then they must go. There is no scope for compromise. With the demands and pace of a PE backed business, there really is no room for passengers. This is frequently a difficult part of the job to exit people, however I believe that the wider business understands that difficult decisions need to be made. They will acknowledge where a CEO has made a difficult leadership decision.

Experience is essential

On that basis, there are certain things I always look for in building a leadership team, namely people who have 25-30 years of experience under their belt. I call it my “grey hair” principle. It’s a great support to me as CEO to have a mature, experienced team sitting around the leadership table who will not be fazed by the various business challenges. They will pretty much have seen it all before. This reverse ageism principle has always served me well and I have had great, older colleagues who have done great jobs for me. The other big advantage of this is that they tend to speak their minds more and can contribute strongly to the growth of a business.

As CEO, I don’t have the time to wait through a long adjustment period for management to find its footing or develop into their roles. With the right leadership in place, I can be more confident of delivering the annual return and ongoing growth that investors expect.

Once or twice however I’ve made mistakes, hired someone who wasn’t ready, or wasn’t right for the role. This is when the 6-month probation period is crucial as this allows a get-out for both parties. I believe that setting clear goals for the first 6 months, and giving regular performance feedback, is crucial to letting a new hire know he / she is performing. If they are not hitting the required standard in these first 6 months, I have at times exited people at this stage. This is tough to do but is better in the long run for me as CEO and for the business.

Let them get on with it

When you have experienced people in place, who know more than you do frequently, it aids in the overall momentum of the business. You can give them clear goals, get out of their way and simply let them do their jobs. By identifying situations where strong existing leadership just needs greater independence and rewards, this makes it easier to push the business forward. A good friend of mine uses the 3D rule of management – Decide, Delegate & Disappear! I don’t quite do the “disappear” bit but I do like to actively delegate and let my experienced team work away on delivery.

I also strongly encourage people to have different opinions to me. This challenges me, and ultimately provokes more valuable discussions with respect to business issues. Tapping into the reservoir of others’ experience can lead to far greater returns than having to pull people along with you.

So, in summary, when you hire people that have been around the block, they can handle themselves and the demands required of them leaving you to focus on strategy, direction and other issues.

Consider your Succession Plan

Lastly, as CEO, I believe that it is imperative that you think about your succession plans and how to develop more junior colleagues so that they can potentially step up to more senior leadership roles in due course. Ideally the skillsets and experience is there for every team member to move upwards in the chain but it’s up to the CEO to ensure that smooth transition and to create opportunities for it to happen. Keeping an eye on the future line-up is part of maintaining a strong leadership team.

Hopefully you have enjoyed this short read about the few key principles that I have used in building leadership teams, particularly in demanding PE backed businesses. Perhaps in different types of businesses a CEO may have a longer development time line or may not be under such intense pressure for results each month or quarter. Certainly when I worked as CEO in a plc business, there were always options to move people to other parts of the wider Group so the need to exit people was not as intense. However PE backed business have a particularly demanding dynamic I believe and hence why, as CEO, I adhered strongly to these principles. They have served me well to date!

 

Kevin Murphy is an independent leader in the payments industry, working with domestic and multinational clients to shape their business strategies and improve business performance. With more than 30 years of experience in the financial services industry across Ireland, UK and the US, he is skilled in all aspects of the global payments business, cards and payment systems and in consumer finance issues, including consumer protection, banking regulation and marketing strategies. Kevin now uses his depth of Consumer Finance and Payments knowledge and experience to assist organisations with strategy and execution, advising clients on EU and domestic payments strategies. He is also highly experienced in working with Private Equity businesses in this market. His niche consultancy Colthurst Card & Payment Solutions offers consumer finance and payments solutions to businesses across Ireland, the UK and the USA. You can follow Kevin on @kevinmurphyIE, connect with him on uk.linkedin.com/in/kevindmurphy1 or contact him at kevin@colthurst.ie

 

 

To learn more about Harmonics Leadership Development programmes, please contact Harmonics on 01 8942616, 061 336136 or 021 7319604 or email info@harmonics.ie

 

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“It’s the first time you’ve driven me to school Dad!”

As part of an Executive Outplacement Programme Harmonics is delivering for an organisation, I am currently coaching a Senior Executive who has decided to take a voluntary severance package. He is a driven go-getter and always has been. Keen to look to the future, he has quickly put his previous employer behind him and wants to move on. He only finished up in the past month with his former employer and already has a job offer on the table which he was keen to accept and get back to work.

He loves being busy, achieving goals and ‘driving on’, as he says himself. He is a talented executive who will do well in his next position for the employer lucky enough to get him. He is in his late forties now and the change in career is coming at the right time for him to reposition himself into a different industry sector.

On the rebound

In our sessions, I noticed this rush to get to the next job. It’s fairly common, especially before people have finished up in their previous roles. There’s a mad dash to bank the severance package and make a seamless transition to the next role. The mad dash is derived from the fear of not being busy and that life would not have the regular routine structure. Getting another job as soon as possible also seems the perfect remedy to get over a relationship that ended not so well. If we were speaking about relationships, we might call it “on the rebound”.

Time to himself

In the last few weeks my client has found himself with more time on his hands than ever before in his life. He doesn’t have a structure, meetings, deadlines, emails or teleconference calls. So this week he did the school runs. His eldest, who is 15 years old (the same age as my own daughter), surprised him by saying “Do you know it’s the first time you have driven me to school Dad?” He was dumbstruck.

It dawned on him for the first time just how consumed he had been by work, striving to achieve more and more year after year. He was never around to do the school runs. He has always been busy at work. Busy making sure his family have everything they want. But the simple things in life can be overlooked in the chase to be successful. He spoke of the blindness that extreme work brought to other parts of his life.

It happens. Aspects in your life suffer that you don’t even notice, because you have been blinded by what you think is important. It is not until you take the time to stand back that you can see how consumed you have been by it all.

Time passes swiftly

Following my coaching session, I went for lunch and bumped into a former work colleague who was having lunch with his 17 year old daughter. He had spent the last six months recovering from a health scare. He couldn’t drive because of an eye disease that turned serious. He had to stop work but his scare has been averted and he’s looking to get back to work again early in the New Year. The illness, he said (as he looked at his daughter), made him realize the really important things in life are those closest to you, your big rocks.

It is only two months ago that I lost a big rock in my life. I buried a great friend who passed away after a two year battle with cancer. He was only 48 years old and a role model to so many who knew him. He was hugely successful in business, but always had time for a coffee and a chat. He exercised daily, was a non-smoker, non-drinker and left behind a loving wife and two teenage kids. He even wrote a moving message to be read out at his funeral. In the note he had written “I have no regrets”. He had balanced a successful business life with spending lots of time with his kids and family. He always spoke about having time for family. He has been taken too early but his words “I have no regrets” lead me to think, how many of us can say the same?

Time to think

In the last couple of weeks, my coaching client has been able to get some time to think and reflect. He has begun to notice the things he has missed for so long because he has been distracted by being busy. He has time to think.

We are coming up to the Christmas break when many of us get time to think. The break gives us time off the roller coaster we call work. We let go of emails for a while and catch up with family and friends. We get time to indulge ourselves and have some fun. We take time to read for leisure or go for long walks. Our days lack discipline and are unstructured. It takes a bit of getting used to recalibrating to just being. The technology enabled world wants us to stay connected and prompts us to keep engaging, read the latest tweet or social media post.

Time to be

One of the key lessons I have learned from coaching is not to miss out on our own daughters growing up. I was coaching another busy exec that had lost their job around the time she was born and what he said changed my perspective on parenting for life. He told me that he had invested the past 27 years of his life in a corporate and they had just cut the umbilical cord. He admitted, crying openly to me, that work had taken hold of his life and he had not only lost his job, he had lost his marriage and his relationship with his teenage daughters. He had been distracted by work and missed out on all the important things in their growing up. This served as a timely message to me; don’t lose your family and your daughter however busy life gets.

I am busy like many others. Yes, I am often away mid-week, but what is key is to make the time to chat, to be and if possible to do the school runs every so often. Time to connect, to listen, to think together, to share fresh insights, to laugh heartedly, to spend doing stuff that is just pure fun and to create memories. I can look back at 2017 and say we have created great memories. This blog earlier in the year speaks about our fun trip to London. https://www.harmonics.ie/what-i-learned-from-seeing-kinky-boots/

Time to reflect

In our business we receive many calls from people who have had time to think over Christmas and want a career or job change. So it’s that time of year for us all to reflect. Here are some questions that may help you to think about what’s really important for 2018 and beyond.

• What were your standout memories for 2017?
• Did they include the really important people in your life?
• What didn’t you get the time to do that you would have wanted if you had more time?
• What memories do you want to create in 2018?

If something needs changing, stop saying I’m too busy, change yourself or change the situation. Take time to think, be and most important of all, have no regrets!

  “This time like all times is a good time if we knew what to with it” – Ralph Waldo Emerson

John Fitzgerald – Founder Harmonics

What Do Talent Really Want?

At Harmonics we are increasingly being asked to talk to Senior Leaders about Talent Management and why they need to prepare a Talent strategy. I wanted to share my insights on how we need to get real when thinking about Talent Management.

Is it all about the money?

Corporate Business Leaders are rewarded by how much money they make each quarter for their shareholders. It’s quite simply a numbers game to succeed. HBR this month profiled the Best Performing CEO’s in the world for 2017. Three metrics were used to identify the best:

1. Country adjusted total shareholder return
2. Industry adjusted total shareholder return
3. Change in market capitalisation

It is no surprise from the metrics used that, for a CEO, their track record in delivering financial return to investors is what matters. There is no mention in the metrics about talent attraction, development or attrition, yet we are consistently hearing that an inability to “get the right people” is slowing down business growth.

Short Termism

Top Global CEO’s now make more than 300 times the average worker, up from a 20-1 ratio in the 1960’s. While the salaries have been increasing, CEO tenure has been decreasing each year since 2000. Fortune 500 CEO’s survive 4.6 years on average. These CEO’s and their Leadership teams are under immense pressure to hit the ground running and deliver the numbers. We see the short termism playing out publicly in the Premiership as Football Managers get a short time to deliver results or they are gone. The HBR Best performing CEOS however lasted on average 16 years and had time to effect the change.

This pressure at the top has an impact on attracting and retaining top talent. This short term numbers game is visible for all to see within the organisation.

Everyone wants Top Talent

To deliver the metrics and business results, the heat is on to find the best talent and have them playing as a united and aligned team. So why is everyone finding it so hard to attract and retain top talent. Here are 4 observations from the work we do:

• Every Organisation wants to hire the “perfect fit”
• Top Talent want continuous “career growth” opportunities
• Younger talent have huge “social power”
• Don’t write off older talent too soon

Every Organisation wants to hire the “perfect fit”

We have personal experience to relate to this point. In our recruitment division, Harmonics Recruitment, we have noticed that the time it takes Hiring Managers to make hiring decisions is often too long. If the recruitment process slows down, it can send a message to those shortlisted and impact on the organisations ability to attract the best talent. Difficulty scheduling meetings in Senior Leaders diaries can slow down the hiring process but the real reason great candidates are lost is because employers keep holding out for the “perfect fit”. Everyone wants the “highly experienced with specific industry experience and a glowing track record” so they can hit the ground running. In a tight labour market, there needs to be more realism on what is available in the talent market.

We also observe Business leaders reacting to different crisis, spending days in back to back meetings and putting out fires. They don’t have time to coach and mentor new hires. Hence, they want the “perfect fit”.

However, to attract talent, leaders need to commit time to coaching them to bridge the industry or skills gap. Yes, it does take time, but when you hire for attitude and mind-set then the skills and knowledge acquired in the role offers the career growth talented people are looking for. What hiring managers need to realise is that their idea of a “perfect fit” is based on a CV that describes what a person has already done and often not what they want to do next. Those being headhunted will often ask our recruiters where the career growth opportunities lie in a role that looks similar to what they’ve being doing for the past 2 years. So when recruiting, it is important to remember that your perfect fit may not be the candidates idea of a perfect fit for their career future!

Top talent want continuous “career growth opportunities” – When speaking to a Senior Director last week, she described her experience with a past employer. She said “it was a time when there was just one amazing career growth project after another. I never thought of leaving. I had great mentors who created the paths for me to develop new skills. I learned more there than with any other employer”.

Organisations have become flatter and retention strategies driven by ‘promotion promises’ are simply unsustainable. The career up the functional silo is too narrow and does not build out the breadth required for future leadership roles. Career success is not only about promotion, top talent may want to stay and deepen their knowledge and skills in specialised roles critical to the future organisation. Offering hi-potentials a management position without ascertaining a ‘skills fit’ leads to a great career hitting an unexpected crash without any warning. Our career accelerator coaching programmes have been designed to guard against this happening. Great career progression in organisations needs to change to be become more about further developing your strengths which enhance future employability rather than just climbing the ladder to promotion.

Today, there is a dual ownership onus on both employer and employee in making career growth opportunities happen. Roles are constantly changing, new job titles are appearing and new skills are in demand. To use the football game analogy again, the game is constantly changing, it is about adapting and anticipating to these changes. We have helped organisations illustrate changing career paths to paint a clearer picture for employees where they can grow in an organisation that is rapidly changing. The traditional org chart has now become an organic chart that is quickly evolving as new skills are needed.

Younger talent have huge social power – Like-minded younger talent gravitate towards each other. They see what others are doing and want some of that too. They are that stage of life when they are curious and seeking new experiences. They also don’t trust organisations like their parents did because they have seen their parents being made redundant after giving many years loyal service.

Instead, the new loyalty is to look after numero uno. It is about gaining as many varied experiences, skills and knowledge on their CV as possible. The CV today is like a career passport where lots of organisations, roles and achievements are stamped on it. This new approach affords mobile talent entry to new employers and ensures they never go stale.

For organisations, it is being clear from the outset that talent will leave. It is not personal, it is just how the game is now played. But it is just important to learn the preferences of this nomad generation of mobile talent and help them to grow while they stay. They may come for a while and they may boomerang back again at some point on their career journey when they have learned new skills. We also see great opportunities for organisations to help younger talent become teachers of specific skills while they are here. This way they have left a legacy and the organisation has been enriched instead of feeling anger about talent moving on. Younger talent have huge social networks and their word is gospel to their friends in choosing where to work. If they have a bad employee experience, it goes viral on Glassdoor at speed. It is true, social is the new power.

Don’t write off older talent too soon – In our research, the average age when people are getting the tap on the shoulder from corporate employers to take a package appears to be 52. This milestone seems to indicate when someone has become too expensive in the corporate world. It’s leading to a lot of stress in the workplace for this age cohort who feel let down because they have offered such loyalty.

There is a new employer-employee contract required for those talented people who are being pushed out before their time is up. Those who fear they may be at risk need to develop a growth mind-set and demonstrate how they can learn new skills and pitch what they have to offer. This is what is required in the new world of work.

Your career is your business and it is up to employees to keep pitching for work like a start-up would to an investor. I have seen people in this age bracket be reactive and wait for the organisation to tell them what to do. The onus is on the employee to make the business case to their employer.

Employers, on the other hand, need to have development conversations with their over 50 talent. I see talented people over 50 being written off too young because frank and honest conversations failed to happen on both sides. In our opinion, those who are 50 plus need to opt-in to taking on further professional development. By opting out, they are demonstrating a fixed mindset and telling their employer they are closing the door to new internal opportunities. It may be the right time to leave, but the size of the package is only one consideration, how to become employable and marketable in the future is another and this requires opting-in to some form of development.

“Not everything that counts can be counted”

This quote by Albert Einstein was never more relevant in the search for talent. The best performing Global CEO’s list is indeed measured by financial metrics. The best performing talent more often than not do not trust organisations.  They instead trust what their friends tell them and what they read on Glassdoor. This is not so easily counted. Metrics find it harder to identify the manager that is blocking a talented person’s opportunity to make their next internal career move which is the real reason they leave. It is only in hindsight that we hear about the recruitment process that took too long because leaders could not make a decision about a candidate that wasn’t just the “perfect fit”. The busy leader who is still rewarded with their bonus even though they are stuck in back to back business meetings and haven’t taken the time to coach and have career conversations with their talented people who are being head hunted and feeling loved elsewhere. The busy organisation that fails to proactively create “career growth” opportunities for their hi-potential talent and then mourn when they leave.

Attracting, developing and retaining talent is not all about offering better money or office perks. It is, more often than not, about having the time for great career conversations to find out what talent really want both at interview and as they progress in your organisation. It is about taking the time to have lunch offsite and listen, truly listen to what is being said so you can help your talent to grow. Tony Crabbe wrote in his best-selling book Busy. “It’s the first time in history we can work when we want to so we do!”

The above strategies do not cost any money, they simply require attention. They won’t appear in any financial metrics for a Best Performing CEO but they will make a huge difference to your talent strategy. We just need to be more honest with ourselves and take the time to discover more about our great talent before they leave.

“If you need to conceal your true nature to get in the door, then you’ll probably have to conceal your true nature to keep that job” – Seth Godin – Lynchpin