Recruiting Senior Executives – The Pivotal Rules

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Nothing is more important to a company’s success than having the best possible leaders in place. Not necessarily the most easily found or most—or least–expensive. How should we go about securing them? Are there principles that apply to all organizations, regardless of industry, culture, or mission? In my experience, this list represents the most important, most common features of a great search. All are invited to comment and make this the best resource it can be for executive search in SoCal and beyond…

1. Properly build and prepare your hiring team

Start here. This may be the rule where the reader is most likely to overestimate her company’s capabilities. Smaller companies with less experience hiring outside their circle of close contacts really struggle here. The cause is a combination of a company’s natural tendency to stress rigor, process, and data and sometimes neglect the nonlinear, human part of the proceedings. First prepare your team to just be good people (see rule 5 below for elaboration).

Done well, the interview process for your new CTO (for example) can be a fun, positive, process and not a dreary soul crusher.

  • Select an interviewing team.
  • Prepare the interviewing team.
  • Consult with the team often.
Selecting Team: Get Together

First, assign roles: leader, culture interview lead, technical/process interview lead. Jenny Jedeikin puts it wonderfully succinctly as in her post: for those crucial hires. Someone needs to step up (or be drafted) to be “Recruiter-in-chief” and take on that responsibility.

Preparing Team: Get Honest

What does each interviewer want to contribute to the interview process and what do they NOT want to contribute? Together, gently, the interview lead needs to help the team look in the collective mirror, discuss strengths and acknowledge weaknesses. Communicate and get agreement on the areas of comfort and discomfort for each.

Besides a recruiter-in-chief , there needs to be at least two more sub leads. A functional lead that is in charge of screening for functional experience and knowledge. Finally, a culture lead who has a handle on the interpersonal relationships at work in the company. This person should not be overly concerned with job knowledge—there are others for that. This lead is concerned with finding out if the personality fit is there. Each of the leads should have veto power.

Make plans for each step of that process that are natural and organic for your company. If you’re a proudly quirky company (and I hope you are) put some of that quirk into your interview plans.

Consulting with the Team: Get on the same page

Plan to get together (face to face) and discuss each candidate the next day, if possible. I suggest the following day because that gives some time to process interviews and reflect. There will be fewer knee-jerk opinions. Waiting longer than a day, and the impressions start to fade too much.

See Bob Norton’s opinions in items 4 and 5 in his blog post. There is large crossover in his opinions—but some differences as well.

2. Network with purpose and identify first candidates

The idea of tapping your personal network first is uncontroversial. The point is to apply some rigor to the effort. Getting the word out to those within your team’s immediate circle of influence takes planning and organization. Recruiter-in-chief must carve out time—maybe 2 hours—and get the search team together to systematically build a personal networking plan. This process is familiar to a quality executive search firm, and even some of the better staffing agencies for non-executive recruiting. Not many technology/media companies have this in their bag of tricks—and it needs to be there. If your executive search firm does not suggest this up front and organize it for you, the internal Recruiter-in-chief should suggest it and make it happen. In short, the process consists of the interview team meeting and systematically remembering who they know. This entails a guided, coached process of

  1. Premeeting preparation – everybody takes time to go carefully through their contact lists—Outlook, Google Contacts, LinkedIn, etc and find all the strong candidates and all the people who are very likely to know strong candidates. This process can get unwieldy, so the interview lead must coach well
  2. Meeting – go around the table going through the contacts briefly and discussing the whys. The real power comes from the ideas that build as patterns emerge.
  • Personal networking is not always easy—accept guidance here
  • Professional recruiters can help get the most out of your hard-earned network

3. Face to face conversations that leave technology aside

Everyone agrees that sharing a room with a candidate before making a final decision on bringing him on board is practically required. The exception to the rule is the occasional virtual employee or contractor whose work is such that isolation from others poses no real problem in productivity. A senior executive is never in this position, so we need to spend quality time with this person during an extended interview period.

As quoted in Jenny Jedeikin’s blog post, Eric Herrenkohl says, “While it’s a great start to connect with people on social media, people need to know, like, and trust you before they’re going to have career conversations with you at the higher levels,”

For that matter, every effort should be made to spend some significant time with candidates over food and drink—or some other non-business venue. A person’s personality can take many hours to fully express itself. An accomplished candidate has learned to keep a lid on any rough edges for the process of interviewing. We’ve all be coached constantly since college on how to interview. Those lessons stick! In practice, our team has found that even one dinner with the, say, three finalists for Chief Revenue Officer are priceless. Those edges show through and the final decision can become much easier.

Others have suggested to go even a step further and have a candidate work for a week with the team if possible. The hypothesis being that a jerk’s true nature will always make itself known in that time. They can’t help it.

4. “Power Up” your interviews

A new senior leader at your company has the potential to inspire her reports, peers, and bosses to new levels of productivity, profitability, and add to the company culture in positive ways. The opposite is also possible. The difference between the two is a chasm—a hiring mistake that has business costs, including the opportunity cost of “what if we had hired him instead…”. The expression “data-driven” is now mantra at tech companies—this gets useful data!

Harvard Business Review suggests going beyond the typical interview and we agree wholeheartedly with this approach. A bit of planning and imagination is all that is needed to come up with ways to see an exec in action and give the hiring team plenty of information that will truly differentiate among finalists.

Among other recruiting professionals, The Overture Group suggests asking the candidate for work-product as part of the interview process. A Chief Revenue Officer candidate might be asked to bring a quarterly sales plan she architected—perhaps with details obscured—especially numbers. A CTO candidate should have access to block level IT or application development plans and be able to talk through the decision-making process which could be just as important as the results of the projects.

In my experience, the most impressive senior executive candidates have been eager to speak to their onboarding plan and the overall approach to their first few months based on what they know now. A confident executive and hiring company know these plans will certainly change, but the ability to think through the process speaks volumes about the quality of candidate.

5. Find empathy, and don’t lose it during the search

The average company gets poor marks here. The kind reader probably doesn’t think of her company as “average” …but a lot of companies are…by definition of the word. Look in the mirror and embrace this. Unless your team has made your recruitment effort a core competency, you may not be very good at treating your candidates right. It is probably true that you do a much better job for the one or two people that get to be finalists. Don’t save your humanity only for the person that’s the frontrunner. “Candidate experience” is an oft-spoken phrase at many organizations but the day to day habits that make for a good experience are often lacking.

Care about the experience of all candidates that have been contacted. Establish a system to quickly respond to rejected candidates you’ve made real contact with to close the loop with them—even if it’s a form letter. Take the responsibility as the hiring company to bring conclusion with any candidate who has screened or interviewed. An executive search firm will (or at least should) handle this for you whenever engaged.

Deb McClanahan at Broadband HR calls this, appropriately, Golden Rule. Candidate experience is such a problem that every hiring manager has a bad story from their career as candidate. How about committing to never doing the same to the next person? That commitment by the Recruiter-in-chief will probably bring the proper empathy to the process…for all engaged candidates.

The Semiconductor Industry in Southern California

Updated May 2017 – Original post from 2011 is edited with updated information in red. I find it interesting to see the original and track changes. It gives you a real sense of the motion in the industry.
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Demystifying Software Tech – for Recruiters

The shortage of experienced software engineers in Southern California is remarkable. Our recruiting practice has become more focused on that area in the last 12 month or so. This situation has caused in-house corporate recruiters to work harder and know more about software, the market, and how to talk to engineers to give their company any kind of decent shot of landing the difference makers.
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Catching up on SoCal IPOs

On Thursday September 25, 2008 our then fledgling executive search firm hit the wall that turned into the Great Recession. In week prior we had a client rescind two offers to our candidates and another put off another offer “indefinitely”. “Indefinitely” grew into forever because that company didn’t survive the downturn. I couldn’t tell you exactly what the news items were in the larger world (not good!) but that day it was clear that Southern California growth was done for some time and new plans had to be made. I tell that snippet to explain the arbitrary cutoff date that relates to this post.

In the last few weeks, Rubicon Project (Playa Vista, NYSE:RUBI, jobs) completed its IPO on the NYSE. I’ve been a fan of their business since the earliest days of PivotPoint Executive Search and so that bit of great news got me thinking about the path of SoCal business since late September 2008. One way to break down these years is in terms of public offerings… and so springs this post.

My focus has always been “tech and digital media”—an arbitrary delineation, but I figure we have to put something of a picket fence around our main interests. There are some businesses that don’t clearly fall inside or out, so we’ll consider them part of our world based on feel. For example, Green Dot (Monrovia, NYSE:GDOT, jobs) went public in our timeframe back to September 2008, but we’re going to call them “banking” and not “tech” so that’s the only mention in this space. By one quick, sloppy count, there have been about 20 IPO’s in the biotech/biopharma industries! That’s an interesting and surprising result, and so I’ve promised myself to visit those IPOs in some detail in the near future.

I’ll also mention some companies that have flirted publicly with making an offering, but haven’t yet or changed their minds: LegalZoom (Glendale, jobs), NewEgg (Whittier, jobs), Hulu (Santa Monica, jobs), Nexsan (Thousand Oaks, jobs), and Fallbrook Technologies (San Diego, jobs). Dropping the idea after a due diligence period is not unusual…these are all very good companies. Of additional note: NO Southern California cleantech (I use my own wide definition) companies have made the leap to stardom. Fallbrook fell short. Perhaps Tesla Motors may be the first, but they’ve defected to the Bay Area.

Chomping at the Bit

There wasn’t a single tech IPO in the neighborhood from September ’08 until April 2010. It was not a good environment. . So it’s easy to imagine some pent up IPO energy that needed to be released once the floodgates opened – or there was a slight ray of sunshine.

MaxLinear (Carlsbad, NYSE:MXL, jobs): Jumped into the public markets in April 2010, leading the way forward out of the downturn. Just when you thought that semiconductor companies were starting to fade into stability, a fabless house like MaxLinear jumps up. Gross proceeds were $89.6M and current market cap is $314M. Their chip designs allow for high-speed broadband reception on all sorts of devices—speeds that allow for video streaming among other applications.

ReachLocal (Woodland Hills, NASDAQ:RLOC, jobs): This stock started trading May 2010. ReachLocal is the go-to move for all those local businesses that don’t know anything about Internet marketing. Sounds like a really big list to me, and a great opportunity. The NASDAQ agrees, giving ReachLocal a recent market cap of $288M.

RealD (Beverly Hills,
, jobs): Since their July 2010 IPO, RealD has continued to be one of the “Big 4” independent (RealD, IMAX, Dolby, Xpand) theatrical 3D formats. RealD emerges as the winner here. Recent market cap of $541M.

Building the Momentum

With the cap off the bottle, there was a mini rush to the NYSE and NASDAQ over the next year…

Inphi Corporation (Westlake Village, NYSE:IPHI , jobs): Yes, Inphi has officially moved to Santa Clara, but I continue to claim them for SoCal. They listed publicly in November of 2010 and have a recent valuation of $449M. Like MaxLinear, they can be generally described as mixed-signal (digital and analog) semiconductors. Such chips compute, convert, and store analog signals like light and sound measurements into digital signals like jpeg photos and MP3 audio files. Inphi is focused on the super-high bandwidth hardware needed at big regional data centers.

Demand Media (Santa Monica, NYSE:DMD , jobs): It’s not simple to explain what exactly Demand Media does. It requires a few more words than any other company here. They’re a domain registrar, and make money selling top-level domain cyber real estate. They’re also a very wide-ranging Internet publisher. They employ hundreds of people (we see them hiring a lot) writing specific content that gets found by search engines and they run advertising against it. Have you forgotten how to make peanut butter and jelly sandwich? Demand’s eHow brand has your answer. Without looking to actually answer this question, I don’t believe Demand has been profitable (net income, not EBITDA) over any quarter. (I’m sure I’ll be corrected). For one thing, the dramatic demise of Lance Armstrong’s reputation has severely damaged their brand. Recent market capitalization: $379M; IPO: February 2011.

Cornerstone OnDemand (Santa Monica, NASDAQ:CSOD, jobs): A big player in cloud-based software for managing human resources (Human Capital Management). Like all cloud-based/service-oriented architecture/software-as-a-service providers, Cornerstone makes it easy for their customers to pay a monthly bill, open a browser, and solve all kinds of complex business issues. Their IPO was March 2011, and current market cap is $1.9B.

Boingo Wireless (Los Angeles, NASDAQ:WIFI, jobs): Boingo supplies WiFi systems to airports, hotels, and the like. To go along with them, they provide software that runs on your computer or device to connect up. They went public in May 2011, and recent market cap is about $244M. I’ve always loved the name so they were among the first companies I ever mentioned.

Active Network (San Diego, jobs): Weird story here. Active Network went public in June 2011. A little more than two years later, they were bought out and taken private. Soon after…massive layoff, a split of the product group and what looks like a move sometime soon to Austin, TX (a town becoming a real tech player for those not paying close attention). They deliver cloud-based software to run all manner of events. Their roots were in sports leagues, running events, etc…thus the name.

A 14 Month Lull in Tech IPOs

Peregrine Semiconductor (San Diego, NASDAQ:PSMI, jobs): A third semiconductor company for our list. Their products are centered on their patented UltraCMOS®process. In short, they make stuff that runs wicked fast at low power for your smartphone or smart-whatever-device. Public since August 2012 with a current market cap of $185M give or take.

And 20 Months Later…

Rubicon Project (Playa Vista, NYSE:RUBI, jobs): And so we’ve come full circle. Rubicon went public just this month. They’re one of a few supply-side platforms (as opposed to the many demand-side platforms) that bundles internet publishing real estate in a platform that automates and optimizes the sale of associated ad space. For quite a while, I didn’t know of any other company doing this. There are others, but Rubicon is top of the heap.

And so we’re caught up. Rumors suggest that Santa Monica’s TrueCar might be the next to tackle the public markets. When I saw their first TV commercial a few months back, I knew something big was on the come. Whoever next joins this company, I’ll update this post. With luck, they’ll come faster and faster as Silicon Beach (and the other tech districts) prosper.

Business Email

I’ve found combining Google Apps syncing with Microsoft Outlook is a pretty formidable combo. I defy anyone to show me a more powerful email solution for the SMB world! I’m even skeptical there’s an enterprise solution that’s better…

The Los Angeles Digital Agencies – Beyond the Majors

A while back, I published an (of course) incomplete rundown of the Southern California presence of the major advertising agencies. As expected, we got some feedback from the independents looking for a little bit of love. Here, only two years later, we offer it! This is by no means comprehensive—these are the agencies that have popped up on our radar here most often and most positively for whatever reasons. We’ll continue with others in the near future (promise!)

Blitz Interactive (jobs link, blog, Facebook): Ivan Todorov’s world class indie, launched in 2002. These guys are regular award winners, at the biggest scale. This digital-native agency has produced work across every digital platform imagined. Their client list would be just about impossible to be surpassed by a small agency: Microsoft. GE. Lexus. Visit their site to see the many others.

Fanscape (jobs link, blog, Facebook): This is the first major “word of mouth” digital agency I am aware of. Launched in 2000, Fanscape works with major brands to create and facilitate viral campaigns. Most campaigns never reach “viral” level, of course—but Fanscape helps brands get the very best of their social media campaigns and promotions across all digital media.

Briabe (jobs link): Briabe Mobile operates the America-Next™ network—a mobile display ad network, focused on multicultural communities. Their client list includes heavyweights like Microsoft and Ford Motors.

The Search Agency (jobs, blog, Facebook): If you’re in SoCal and you start looking around for a performance-based (i.e. AdWords) agency, The Search Agency will pop up everywhere you turn. This is the kind of company to help do the same with yours!

David&Goliath (jobs, Facebook): If this El Segundo creative agency produces no more good work from this point forward, their unbelievably entertaining Kia commercials have already landed them in my personal Hall of Fame.

Ignited (jobs, blog, Facebook): El Segundo has a nice collection of tech and media companies to go along with a number of agency offices. To go along with their contract across a number of NBC properties, they do a lot of great work with edgier, trendier clients including videogames.

Phenomenon (jobs): Cool agency. Nuff said.

The Designory (jobs, Facebook): The only creative agency I know of in downtown Long Beach…and a good one.

As a major media center, Los Angeles has more than our share of major creative and media agencies. This introduction to the indies is meant to be just that… an intro. We’ve learned that digital advertising agencies sit near the center of the hub of the new economy. All consumer businesses must advertise their products and services somehow. The agencies make that happen efficiently across the entire spectrum of industries. We’ll continue to shine a light on this industry which leads us to their clients and the jobs, media, and technology they create.

Windows 8 Rocks

The new OS rocks. For the first time in about 15 years, Microsoft has invented something really good that wasn’t just a copycat. (I include Xbox as a copycat).

They’ve done first what was inevitable…a way to marry touchscreen computing with PC computing into something intuitive and elegant. They also have switched the focus from “software programs” to “subject matter”. The Messaging tile can bring together all the different providers. Same with People, Music, etc.

I think Microsoft is going to get some really good ink and see its stock perform very well over the next few years, fueled by what they’ve started this year. And just when I was about to write them off…

Idealists @ Tech Companies: The Oddest Couple?

Yes, that’s a picture of Oprah Winfrey—though not super recent. What’s she doing in a blog that talks about tech and digital media in Southern California? Tech and digital media companies like all others are collections of different personalities and that’s one of our favorite topics here at Pivotal Points. Darn near every American recognizes Oprah and has a quick understanding of who she is and what kind of person she is. She’s a prototypical Idealist, more specifically a Teacher. Read more