CEOs Share Valuable Lesson: Be Careful When You Hire

    It has become a common refrain among tech company founders and CEOs I’ve spoken with over the years: Failing to do an adequate job of vetting the people they have brought on board to help them build their companies has been a handicap that they would love to have avoided.

    When I interview company founders and CEOs, I almost always ask them, if they could have one do-over since founding or becoming CEO of their company, what it would be. Occasionally I’ll get a CEO who claims there’s nothing he or she would do over, which, of course, is nonsense. On the other end of the spectrum, I sometimes get candid responses about a bad product development or other tactical or strategic decision made along the way. But if there’s one response I get more than any other, it involves having made far-reaching hiring mistakes.

    I spoke to Warren Shiver, managing partner and founder of Symmetrics Group, a sales and marketing management consultancy in Atlanta, in a previous post. I didn’t include it in that post, but his answer to the do-over question was this:

    In any small company, or small team, for that matter, one additional new hire matters in terms of the impact on the team, both positive and negative. I think we’ve been very successful, overall, in the team members that we’ve hired. But where I’ve personally probably made a couple of mistakes with respect to people, that certainly has been both emotionally and financially punitive. I’m sure I’ll make mistakes going forward in this way as well, but with the benefit of hindsight, there are probably a couple of people decisions I would rather have not made, on the way in and on the way out.

    I asked Shiver what he’s doing differently now that he’s learned that lesson, and he cited three changes:

    We typically are interviewing more broadly in the company, for all roles. So instead of having just one or two interviewers, since culture is really important to us, we have multiple people from our team interview new candidates. We also have a much more structured onboarding program. We’re a virtual company—we don’t have a physical office location at this point, but we do have critical mass across multiple cities.

    It’s certainly important to onboard people effectively, to make them feel that they’re part of the team, and get them productive as quickly as possible. So we’ve certainly made some investments in structuring our onboarding program. Third, I think one of my weaknesses has been around performance management. When, for whatever reason, it hasn’t been a fit, I’ve probably been a little too slow to make the change on our end. And I’ve started to correct that a little bit, as well.

    In my recent interview with Tigran Sloyan, founder and CEO of CodeFights, a coding competition platform provider in San Francisco, Sloyan shared a similar experience in response to the do-over question:

    I think it would be around hiring. It’s ironic that we’re in the recruiting market, but one important thing I hadn’t realized when building our team, which caused us a little bit of trouble in the beginning, was that personality really, really matters.

    Initially we were thinking, this person is the most highly skilled person in the world, so just go ahead and hire him. Now, we actually have an internal talent team that works with the awesome engineers who come through CodeFights, and tries to find a perfect match with the companies we work with. It’s more of a personal matchmaking: Is this person the right cultural fit?

    Employment is a very sensitive issue—it’s more like getting married than just randomly finding a perfect skills match. Not realizing that in the beginning has hurt on our internal hiring side, where we were initially building our team purely based on skills. A couple of months down the line, it’s more 50-50—skills is 50 percent of the game, and the other 50 percent is about the cultural fit and the personality traits that you’re looking for.

    Job Interview

    In addressing this topic, I’m reminded of my interview in September with Brienne Ghafourifar, co-founder of Entefy, a Palo Alto-based startup that provides tools for digital interaction. Here’s what she had to say in response to the do-over question:

    I think it would probably have to be really honing in and getting the hiring process right. For us, we’ve been so fortunate—we have such an incredible team. But these are all things that you learn over time. Becoming really specific and clear about the hiring criteria, what it takes to bring someone on board, what the chemistry fit is like—all of these things are things that we learned along the way, and it’s proven to be extremely successful. But we can always get better at that—making sure that we hire the right people for the right jobs, who really wants to stick with it for the long term, and people we can really work with.

    I’m also reminded of my interview last year with Ray Zinn, founder and now former CEO of Micrel, a San Jose-based semiconductor company that was acquired against Zinn’s wishes by Microchip Technology last August. In his case, his do-over was around hiring in a different sense—he said he’d be more careful about the board members he selected:

    I didn’t think I was that vulnerable—I didn’t realize the influence that the investors have on the board. So I’d be more careful about that—I learned a big lesson on board tactics that ended up biting me. Not that I did a bad job—these are very competent and capable people. I just should have been more careful and more concerned about how I selected the board members.

    I was surprised when they did what they did, by the way, because I thought these were good guys. They are good guys—I don’t want to say they aren’t good guys. But that they would have turned on me, and wanted to sell the company—that’s a concern. Maybe I’m a little bit harsh right now, and I shouldn’t be, because I’ve just gone through losing my company. That’s kind of where my mind is, and maybe I’m not even being fair. They just went in a different direction than I wanted to go, and they’re five, and I’m one. So I lost. I shouldn’t be so harsh on them, because they’re good people. But it’s just not what I wanted to have happen.

    A contributing writer on IT management and career topics with IT Business Edge since 2009, Don Tennant began his technology journalism career in 1990 in Hong Kong, where he served as editor of the Hong Kong edition of Computerworld. After returning to the U.S. in 2000, he became Editor in Chief of the U.S. edition of Computerworld, and later assumed the editorial directorship of Computerworld and InfoWorld. Don was presented with the 2007 Timothy White Award for Editorial Integrity by American Business Media, and he is a recipient of the Jesse H. Neal National Business Journalism Award for editorial excellence in news coverage. Follow him on Twitter @dontennant.

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