Hiring vampires and other missteps that hurt young companies

Hiring vampires and other missteps that hurt young companies

As vice president for talent at a technology startup, Steve Cadigan knew his company had enormous growth potential. But to realize it, he would have to win the war for talent against some industry giants.

“I was physically surrounded by Google buildings. I had Apple down the freeway, Facebook up the freeway and, in San Francisco, there were sexy, little technology darlings like Twitter and Zynga,” Cadigan said.

By comparison, his company at the time, LinkedIn, looked humdrum to many job seekers. Furthermore, it lacked the financial reserves to match the salaries and perks the coolest companies of Silicon Valley delivered.

Yet during his 3.5 years as VP of Talent, LinkedIn grew from 400 employees to 4,000, executed a successful IPO and grew annual revenues to nearly $1 billion. During a one-on-one talk, Cadigan shared some of the biggest talent lessons he learning while driving growth at LinkedIn and other companies.

Build an employer brand

Young companies need uniquely talented, highly motivated individuals to drive growth, but lack the resources and profile to attract top candidates.

At LinkedIn and elsewhere, Cadigan overcame that hurdle by developing a distinctive employer brand and offering a compelling value proposition to employees. LinkedIn’s brand, for example, included the opportunity to work alongside brilliant professionals and shape an emerging company while creating a product that would help other people find their dream jobs.

Don’t hire vampires

In the rush to place warm bodies in needed positions, managers sometimes hire imperfect fits. Taking the time to identify the traits you need in new hires and recruiting until you find them ultimately produces better results.

“Cutting corners and sacrificing quality standards for talent is a huge mistake,” Cadigan said. “You get some people who are wrong for the organization, and dealing with that becomes a huge distraction. It’s like having a vampire loose inside the organization. It sucks the life out of you.”

Beware of battlefield promotions

In a similar rush to fill managerial positions, executives sometimes give subject-matter experts “battlefield promotions” without assessing the individuals’ management skills and end up with under-performing managers.

The more effective practice is to take the time to provide leadership development within the company, create career advancement opportunities for skilled employees who wouldn’t make good managers, and search for highly skilled managers outside the company.

Culture Clash: Don’t let corporate culture issues derail your merger

Corporate culture may be a soft concept, but some days it packs a very big punch.

Consider the impact of corporate culture on mergers. In the rush to complete due diligence and seal the deal, few companies conduct a cultural survey of both legacy firms and develop plans to effectively blend the two cultures. Fewer still delay, alter or abort mergers based on findings that cultural differences could jeopardize the deal’s success.

Yet studies show roughly 75 percent of mergers fail to meet financial performance expectations. And, executives often point to incompatible cultures as a prime cause of those financial shortcomings.

Mike Monahan – who executed nine mergers and acquisitions as CFO of the private equity firm, PetroChoice Holdings and now serves as the CFO of NutriSystem, Inc. – offers some advice on how to prevent corporate culture from derailing your strategic growth plans.

Setting clear business goals for the merged company and quickly showing progress in achieving them is essential to creating an effective culture and a successful merger, Monahan says. That focus helps employees understand their role in the merged company and the reasoning behind its culture, and fosters confidence that the company is capable of achieving its goals.

Leaders of the merged company need to be dedicated communicators. During its acquisitions, PetroChoice implemented several communications practices – including weekly e-mails about company accomplishments, annual meetings and travel schedules that gave company leaders face time with employees in distant offices – in order to discuss merger benefits, address operational issues, and keep morale high.

Finally, leaders of merging companies need to be willing to adjust their expectations for the new corporate culture even after the merger is complete.

“You have to be willing to be flexible after the deal closes, and open to new ideas because it’s impossible for both companies to fully know each other and their strengths and weaknesses until you merge,” he said. “There are always surprises. We were most successful when we had the right leaders who were flexible, open-minded and respectful of the different partners. In those situations, you end up getting to the right place, even though it may not be exactly what you outlined at the outset of the merger talks.”

Employer Branding

Developing an Employer Brand

An accomplished HR professional with such industry giants at DuPont, ARAMARK Healthcare and Teva Pharmaceuticals, Karen Piraino faced a formidable challenge when she became Global Director of Talent Acquisition for a newly formed company with aggressive growth plans.

Executives at DuPont had decided to spin off their performance coatings division – a thriving business with 120,000 customers worldwide and 2012 revenues of $4.3 billion. The Carlyle Group acquired the division, transformed it into Axalta Coating Systems, and launching the Philadelphia-based company onto an aggressive growth track.

Suddenly, Piraino was responsible for efforts to fill Axalta’s corporate offices, 35 manufacturing plants, seven R&D centers and 12,000-member workforce with smart, passionate, fast-moving, risk-taking professionals who could successfully drive growth across 130 countries.

To help achieve that objective, Piraino engaged in employment branding – a tool that is becoming increasingly important and potent in talent searches. Successful employment forges closer ties between a company’s marketing/communications and human resources departments in order to apply the best practices of corporate/product branding to attracting great employees. Together, those departments expand the company’s branding efforts to deliver a “employee value proposition” – a clear and compelling depiction of what employees could expect to get from the company and what they would be expected to deliver as staff members.

At Axalta, Piraino and other executives strengthened their employment brand by embedding it in the company’s overall branding and all corporate communications. To deliver the right message to employees and potential employees, they focused on the company’s core values and the key behaviors desired in its employees.

“Our culture is fast-paced, aggressive, results-oriented, highly accountable, risk-taking but with smart decisions about risk,” Piraino said.

Consequently, any communications related to employment at Axalta – including its corporate web site and product descriptions – began to convey that work culture both through words and visuals.

Developing an employment brand and making it a cohesive component of all corporate communications requires talent professionals to stretch beyond traditional recruiting activities. However, the effort also lets talent professionals tap powerful tools. After all, if branding can fuel enormous demand for Apple devices or other consumer products, it could also spur the best talent on the market to seek positions in your company.