The decade since the end of the last financial crisis has seen a massive shift in talent from large multinational corporations to smaller, entrepreneurial growth companies. By 2020, “the venture industry deployed $136.5 billion in US-based companies, surpassing the $130 billion mark for the second consecutive year,” according to PitchBook.
The brain drain out of corporate America has led to frustration and wound-licking for the likes of public company CTOs, CIOs, CEOs, CHROs and heads of talent. Many of these leaders are even more anxious today, assuming this trend will continue due to the pandemic.
But does it have to be this way?
Big Fish, Little Fish
Relatively speaking, large corporations, while still hurting from this shift, are in a much better spot than the growth companies that had been picking off their talent. I tend to see businesses falling into two categories:
1. Companies that have scale (large corporations) and are looking for innovative talent.
2. Companies that are innovative (often startups) and looking to achieve scale.
Over my 16 years as an executive search consultant in technology, I have found that the most successful executives I’ve placed at clients have a combination of these two experience bases in their backgrounds, and I make it my mission to find the ideal overlap on the scale-innovation Venn diagram for all of hiring recommendations that I make.
For the past 10 years, given the technology investment market, well-funded growth companies — the innovators — have had a fun time picking off scale executives with what could be described as Monopoly money in the form of stock and, more recently, even cash. When I see wildly over-market compensation packages and suspect hiring practices, I am reminded of what the great business prophet Warren Buffett is credited with saying: “Be fearful when others are greedy and greedy when others are fearful.” The compensation packages I have seen used to lure senior executives to smaller companies have been unprecedented.
However, I do believe that the tide is now turning, and large companies that have strong underlying business models and a decent balance sheet have an opportunity to scoop up some very strong, innovative talent in the coming months and years. In other words, it’s time for the big fish to eat the little fish that have been nipping at their fins. It’s time to get a little greedy.
And it makes sense for both sides. It’s a time when larger companies can turn a bad situation into a good one by attracting leadership talent that was unattainable in the past. This is also an opportunity for innovative leaders to take their skills and creativity to an organization with a larger reach and, potentially, overall impact on the world.
What To Do Now
For big fish business leaders, begin to approach your new talent acquisition with the following exercise:
• Sit down and articulate what your company can look like one, two and even three years from now. What is the art of the possible? What is the market opportunity, and where do you play? What does your organization need to look like to get there?
• Design the organizational structure necessary to realize this vision. Do not put this together based on the existing talent in your organization. I know this can be hard, but have fun with it. Suspend disbelief, and pretend you able to start with a blank sheet of paper.
• Then start populating this structure with the names of existing leaders in your organization. If an existing leader does not fit, do not squeeze them in — put them to the side for now.
• Is everyone sitting in the right seats of the bus? Do you actually have missing seats that will hold you back from achieving your vision? If so, describe the experience base or organizational muscle that needs to be built into your company. Put aside your previous assumptions around the availability and cost of innovative talent.
• Figure out how to get the right existing leaders on the right seats of the bus.
• If a seat is missing or not fully formed, put pen to paper, and start to articulate what this new leader needs to look like in order to have all pieces to the puzzle. Again, have fun with it.
• Reach out to your strategic talent consultant to help you get over any hurdles in this exercise.
Now that the tide is turning, corporations have an undeniable opportunity to pick off the talent they have not had access to for the last decade. Follow this exercise to identify the gaps that are primed to be filled by fresh, innovative leadership.
