Thursday 27 December 2012

The Business of Inspiration

Welcome to the last chapter of the ebook by Rob Symes. We are chuffed to hear that those of you who accessed the full version of the ebook have found it insightful. Enjoy the read!

The Business of Inspiration

“I want an extreme experience…with your hands hurting, your feet hurting, your back hurting, your voice sore and your sexual organs stimulated.”
Bruce Springsteen

 “Hiring is what you do when you let the world know that you're accepting applications from people looking for a job.  Recruiting is the act of finding the very best person for a job and persuading them to stop doing what they're doing and come join you.”
Persuasion begins and ends with inspiration.

Unfortunately, most businesses career pages have as much joie de vivre as road-kill and their recruitment process is as inspiring as a vasectomy.

Technology changes the status quo. Whether it’s magical like the iPod, mythical like Instagram or terrifying like the atomic bomb, technology is and never will be boring.  People want a mission, a purpose, a cause celebre. The five-to-one candidates certainly do.

Wednesday 19 December 2012

You are not selling pens!

Here's the next chapter of the ebook by Rob Symes. Enjoy the read and come back for the last chapter next week.

“Most salespeople don’t give you orders, they give you bar bills.”
Paul Johnson, Serial entrepreneur

My first experience of sales was trying to sell a pen. Not just any pen but a crap biro. It was hard. Eighteen years of education, a posh private school and a lifetime of competitive sport hadn’t prepared me for the sheer difficulty of persuading someone to part with their money. My interviewer wasn’t particularly impressed and I didn’t get the job. But the experience left a lasting impression that a sale was very very hard. Selling technology is even harder. Customers haven’t heard of your product and if they’ve heard of it they often don’t understand it.

Hiring star salespeople is a universal problem for technology companies. Good salespeople are difficult to find, harder to hire and a track record at one firm does not translate to success at the next. Most participants of this E-book mentioned varying degrees of difficulty in hiring salespeople that actually did what they were hired for: Sell. One CEO, when describing his salespeople, squeezed his paper cup so hard in frustration that water exploded on his trousers.

Sales are where the rubber should meet the road for tech companies. But as Richard Leaver, CEO of Blue Star Capital, quips “techies think ‘If we build it they will come. If they don’t they’re idiots’.” Unfortunately, however good your product, at some point you have to sell it. Which means, if you’re not going to sell it yourself, you’re going to hire a salesperson. And even established technology companies have difficulty doing this effectively.

Therefore, I was interested to hear if a former Autonomy executive had any answers to permanent conundrum of hiring “five-to-one” salespeople.

Chandratillake’s story is a technology reporter’s dream. Born in Sri Lanka before moving to the UK and studying at Cambridge, he set up the American office for Autonomy’s CEO, Mike Lynch, before spinning out a team of twenty to form Blinkx in 2001. Blinkx’s revenues grew by 73% in 2012 to 114 million dollars.

What makes Chandratillake engaging is not just his story but also his capacity to analyse it. I’m a question machine, it’s my job, but he needs very little prompting explaining the obstacles Blinkx has overcome.

As Blinkx left the Autonomy mothership Chandratillake knew they had to create their own identity. Lynch wasn’t going anywhere, in fact Chandraktillake called him every day for the first six months, but in the words of Autonomy’s CEO they had to create their “own terrorist cell.” Being obsessive, even evangelical, came easily to the start up team. Failure did not. Their first product was a bust. Consumers didn’t care. Just changing from suits to jeans wasn’t going to help them understand the consumer market overnight.

However, Blinkx persisted and soon had created the beginnings of the video search product that has been the bedrock of the company’s success. However, even as Blinkx’s product gained traction Chandratillake began to notice some his salesforce were not as successful as he had hoped. It was not that underperformers lacked diligence or motivation. It was a fundamental flaw in their approach.

Not unusually for a tech start up, Blinkx was selling a new product into an untested market. Sometimes it was difficult to see who the potential market could be and even when they identified content providers like NBC as potential customers there were still difficulties. Over time, Chandratillake saw that traditional salespeople were ill equipped to sell disruptive products. The reason for this is simple to grasp but difficult to implement.

Let’s look at two types of salespeople in 2010: A pen salesman and a salesman selling Wi-Fi into pubs.

The pen salesman knows who he sells to: Retailers. He knows what quantity of pens his customers bought last month. Two characteristics determine his success: personal charisma and the price of his pens. When he engaged with a new customer it was usually once the customer had decided they needed to buy pens. Therefore, he asked questions, negotiated a price and then either succeeded or failed. Simple.

 The Wi-Fi salesman’s job was far harder. In boom and bust, for hundreds of years, pubs had been a simple, profitable business. But the pub trade was changing in part because of the smoking ban and the recession. And while the pub landlord had Wi-Fi at home he’d never thought of putting it into his pubs. The salesman’s job in this case was not to try to flog a Wi-Fi connection based on his charisma and the product’s price. The salesman’s job was to educate the landlord about the disruptive trends happening in the pub market: Less Blue-collar workers, more families and a younger, on-the-go generation who wanted nonstop access to their smartphone and weren’t content with pints alone. Pubs were losing their old day-in-day-out blue- collar workers but not gaining the new generation. Once the salesman had explained the disruptive insights happening in the pub industry he could position his product as a solution. The Wi-Fi product would increase footfall of the younger generation, they would stay longer and buy more because of that and revenues would increase accordingly. 

Unfortunately, the technology industry has been hiring too many pen salesmen. To combat this, Chandratillake’s solution was to “assess salespeople like engineers.” He gave them case studies or logic tests to see how their mind worked. The salespeople were rarely as good as engineers but it gave him an idea if they could spot and explain disruptive trends. Chandratillake knew that his customers, like the pub landlords, often didn’t know what their problem was and therefore would have little idea how to solve it. He therefore needed salespeople who could educate and develop insights based on his video search product and the market surrounding it.

When hiring salespeople technology companies must assess the right characteristics. The pen salesman is dead. Long live the engineer.

Thursday 13 December 2012

Upside Down Recruiting and Talent that Whispers

Here's the 7th chapter of the ebook. Feel free to comment and share with us your views on the subject. Don't forget that you can now access the full version of the ebook

Upside Down Recruiting and Talent that Whispers

If experience is not the sole predicator of success, what is and how do we assess it? Here are two techniques that recruiters have established to discover undervalued or undiscovered stars(1).

Upside down recruiting

Pioneered by Todd Carlisle, a recruiter for Google, upside down recruiting was a response to Google’s realisation that they were looking at engineers CVs far too narrowly, mainly on their academic prowess, educational background and history of achievement. However, many of these geniuses weren't as successful as Google had hoped. Carlisle realised that Google had to take a wider view. Test scores alone were not the measure of the candidate.
There was space at Google for people who had worked to pay for their college tuition, those who had chased athletic success or people who had been running businesses or taking part in multiple extra curricular activities. These people might have faltering academic success but for very good reason. Traditionally, Google who was receiving thousands of resumes a week would hit the reject button.
The best hope of spotting these concealed stars was reviewing the bottom of the resume. There, Carlisle could find out that “someone had competed in four Alaska Marathons…or had made it into the Guinness book of world records…or had published three software manuals by age twenty-five. For the right job these weren't peripheral details. They might be powerful insights into someone’s character or on-the-job potential(2)” So Carlisle tapped page down on resumes and started at the bottom of resumes looking for nascent potential.

Talent that Whispers

In another corner of Silicon Valley, in 2006, Facebook were struggling to increase their team of computer programmers with similarly talented engineers. They couldn't just steal engineers from Google and Microsoft. They didn't have time to recruit at university campuses. They needed engineers immediately. So they built puzzles. Yishan Wong, who put the puzzles together, said, “We developed this theory that occasionally there were these brilliant people out there who hadn't found their way to Silicon Valley. They might be languishing in ordinary tech jobs. We needed a way to surface them.”
            Over 2500 miles away Evan Priestly was completely bored working as a back office computer coder. By any standard success indicators Priestly didn't look gifted at anything. His work history and college grades were average. But when Priestly, saw the Facebook’s puzzle he solved it in forty-five minutes. And when Facebook invited him for a face-to-face interview he dazzled the assessing engineer by telling him that although he could solve the test they gave him it was badly constructed. His college and peripatetic career to date no longer mattered. He was a brilliant programmer. Facebook had found talent that whispered.
Finding auditions that work, specific to your company, are key in finding and selecting undervalued talent. Facebook didn't care that Priestly didn't attend the Ivy League. They could jettison all criteria apart from the one that mattered: Could he drive their company forward.

[1] Quote from George Anders, the Rare find
[2] All these concepts and examples are from George Anders Book, The Rare Find.

Thursday 6 December 2012

The Cult of Experience

We are now more then half way through this compelling work by author Rob Symes. We hope that you are finding it interesting thus far and that you have benefited from the access to the full version of the ebook. We would also like to invite you to come back for more of the insightful chapters in weeks to come. Enjoy the lecture!

“See the whole board.”
President Bartlet, The West Wing

50% of participants believed that “Having done it before” was either unimportant or very unimportant in predicting successful job performance

 200-metre butterfly is pain: lung busting, mind numbing and just plain unnatural. If you ask an average man to perform a 200-metre butterfly it’s important to call an ambulance before you start laughing. Michael Phelps has dominated this pain for a decade. In fact, Phelps has dominated professional swimming.  He won six gold medals at Athens in 2004 and eight gold medals at Beijing in 2008 including seven world records. He would finish London 2012 as the most decorated Olympian of all time with nineteen medals. And right now, as he stands on the starting blocks, staring straight ahead, every pundit, every spectator and most of all Phelps expects only one winner.
 With three metres to go, the indomitable Phelps who had led the race throughout, faltered. His stroke grew ragged and a hitherto unheralded South African, Chad Le Clos snuck by to beat him by less than a tenth of a second. The most experienced, most decorated, most successful swimmer of all time had lost.

 Upsets are everywhere. Yet business failures are rarely so public or dramatic as Phelps’s. However, nearly 66% of companies on the Fortune 100 list in 1990 are not on the list some twenty-odd years later.

Success is rare, sustained success is rarer and success in perpetuity is nonexistent.

Yet, most executives will blindly choose past experience of achievement without assessing whether this success is repeatable. This is lazy thinking. Past experience, while important, is not a predicator for future success.

Traditionally, recruiters analyse three characteristics:  
Ø  Intelligence or IQ
Ø  Relevant experience
Ø  Personality or Emotional Intelligence (EI)

From my conversations with clients and colleagues one thing is clear: Most executives view relevant work experience as the defining characteristic when searching and assessing prospective candidates. Yet, when I asked participants of this study to determine how important directly relevant experience (Having done it before) was in successful candidates fifty per cent believed it to be unimportant.

Behavioural economists have long identified a cognitive bias in human behaviour called Loss aversion. In short, this is a tendency for people to have a strong preference for avoiding losses over acquiring gains. Companies often exhibit this in their hiring behaviour. It is easier to justify a hire and avoid a “loss” by hiring purely based on experience than to make a seemingly riskier decision of assessing a person’s potential. Often, a candidate will be assumed safer if they are less likely to fail rather than more likely to succeed.

  Yet, timidity has no place in hiring five-to-one candidates. Companies must place equal importance on ‘soft’ factors as on ‘hard’ facts. They must enter the murky world of personality as rigorously as they do when assessing past experience. Time and again participants told me of candidates with minimal experience that had become stars. Peter Dawe, the co-founder of Pipex, had a receptionist that became a director, Suranga Chandratillake, the CEO of Blinkx, hired a young woman with no relevant experience in technology who worked in the same building. She has become a top salesperson. Hamish Purdey’s CFO had not run a public company before joining Ffastfill and is now stewarding them through rapid growth.

  Undiscovered, undervalued, underused talent is everywhere. If companies continue to myopically assess only experience they will overlook game changing candidates.

Sunday 25 November 2012

Toilet Paper effort.

Here is the fifth part of the insight into the world of talent search and recruitment processes. Don't forget to comment and check out the full version of the ebook here.

“One time, Ben went to a big bash at the Waldorf. Milten’s there. They immediately started talking business. He said to Milton, ‘how much are you paying for toilet paper?’ And Milton said so much. Ben was buying his quite a bit cheaper, and he knew that you want to be not just cheaper but right. Milton said ‘yeah, but that’s the best I can get.’ And Ben said ‘Excuse me,’ and he got up, left the black-tie benefit, drove out to his warehouse in Long Island, and started tearing open cartons of toilet paper and counting the sheets, because he was suspicious. He knew that Milton could not be paying too much by that wide a margin, and therefore that he must be getting screwed himself somehow on toilet paper.
                “And sure enough, the vendors were saying there were five hundred sheets per roll in one of these things. And there weren’t. He was getting screwed on toilet paper.”
                Buffett knew that he wanted to be in business with the kind of guy who would leave a black-tie party to count sheets of toilet paper.
Warren Buffett, The Snowball
 and the Business of life

  If Hamish Purdey were running a retail store he’d be leaving black-tie parties to analyse toilet paper. I meet Purdey in Ffastfill’s ground floor offices, a stone’s throw from their financial services clients and the square mile’s most incongruous landmark: A croquet lawn. The chrome domed, Australian CEO doesn’t spend much time playing croquet but has grown Ffastfill to a company with a seventeen million pound turnover and upwards of two hundred staff across four time zones.

  Purdey is quick to establish the culture of Ffastfill. “Commission carrying salespeople are a no-no,” he says and executives are expected to keep their phones on at all times. He’s quick to point out that scaling a tech business is not nine-to-five and building a world class team of technical staff, across four development centres has taken a great deal of work. This rhetoric, although interesting, doesn’t distinguish him a great deal from other ambitious technology CEOs. His attention to detail does.

  Purdey realised that retaining the team he had built was a priority in continuing rapid expansion. Salary was a key cause for concern, not least because of the well- documented ballooning salaries in offices next door to Ffastfill. The traditional approach would have been to download two or three generic salary surveys. Instead, Purdey and his senior team analysed the accounts of the ten companies competing or operating in derivatives to work out how much each firm paid in salaries annually. They analysed each company’s headcount, the type of employees and estimated what each employee was being paid. Having analysed the averages, it transpired that it wasn’t possible for their competitors to consistently overpay for Ffastfill’s talent. This kind of in-depth, laborious data analysis makes Purdey’s decision making far more effective.

As Purdey demonstrates with Ffastfill, rapid growth is often the result of “toilet paper effort:” Detail orientated, laborious effort that goes above and beyond a job description.  It may not be fun combing through ten balance sheets but it’s this type of effort that will help Ffastfill beat their competitors and even the competitors that don’t exist yet.

Wednesday 14 November 2012

First Who, then Woo

Hello and Welcome to the fourth chapter of the ebook. We would like to take this opportunity to thank those who responded and shared their thoughts with us about the latest publications in our blog. Don't forget you can now find the full version of the ebook here.

“Hiring is easy and fast and is basically a retail operation. Recruiting is artful and slow and is essentially a direct marketing effort…. Recruiting raises the bar because it demands you have a job worth quitting for.”
Seth Godin, Seth’s Blog
“80% of participants believed that advertising vacancies were either not important or completely unimportant in sourcing A players.”

Phil Mochan is everything a serial entrepreneur should be: feisty, fun and, to the casual observer, slightly mad. The Scottish contrarian started his first business at age eleven, breeding mice. Thankfully, a career spent crisscrossing media and telecoms has been far more lucrative. After three successful exits he co-founded Digital Governance and is quite clear that adverts have not been the driver in sourcing quality engineers or commercial staff. “Nepotism is usually better,” he said with a half smile when we met at a bar overlooking London Bridge. As with much of Mochan’s off the cuff commentary its difficult to tell where the humour stops and the truth begins.

Mochan’s view of job advertising as unimportant is shared by 80% of our participants. With such a prevailing mood of dissatisfaction it’s odd that so many seemingly hard-nosed technology companies persist with adverts. The reason is based more on human nature than business objectives.

As we have discussed, technology companies often have unplanned immediate vacancies. Online job boards offer thousands of candidates-now! However, just because the method is easy and immediate does not make it effective. Yet, many recruiters and HR departments persist not because they are impressed with the candidates but because presenting some candidates to senior management is better than presenting none. In an economy that's stagnating, HR and recruiters are fighting for their existence, which engenders timidity rather than risk taking. The belief is that if you interview safe, available candidates you can’t be fired. Yet, innovation has no place for timidity. Technology companies that shy away from mavericks, jagged resumes, overachievers and inexperienced underdogs will lose.

To attract extraordinary talent you must make extraordinary efforts. When Wayne Rooney changes clubs does he post his CV on Monster? Star computer scientists or salespeople don’t either.

Job advertising makes some companies believe they can advertise, assess and still make happy hour. Unfortunately, giving your recruitment team access to multiple job boards is like giving car keys, cocaine and hookers to teenage boys: initially fun, eventually disastrous.

Instead of advertising the mantra must be: First who, then woo. Find your five-to-one candidates and persuade, court or seduce over time that your company should be their soul mate.  Advertising your vacancies is as seductive as a 3am visit to a kebab van and soul mates don’t like kebabs.

Tuesday 6 November 2012

365 recruiting

We hope you have enjoyed reading the chapters of the ebook by Rob Symes thus far. Today we present you with the third chapter of his inspiring work. Feel free to leave your comments below and let us know your views on processes of recruiting for technology and high growth companies. You can now also access the full version of the ebook here.

365 recruiting

 “After the game… early edition newspapers with SUPER BOWL CHAMPS in bold letters were being displayed on the field… It was a celebration, but the team builders in the group were still thinking what was next.
‘For whatever reason what stood out more than the parties and parades was the reality of how far behind we were’, Pioli says.”
Michael Holley. War room: The Legacy of Bill Belichick and the art of building the perfect team

American Football is a laboratory for studying recruitment. Soccer is not.
Both are worth billions of dollars, highly competitive and highly scrutinised but crucially American football has a salary cap. When a rich soccer team, like Chelsea, wants success they open their chequebook and just buy players. If those players don’t work, they buy more players. When money is no object, mistakes don’t matter which is why Chelsea can pay thirty million and a hundred and twenty thousand pounds a week for Andrei Shevchenko to fail.

American football teams can’t overpay for players because if they overpay in one position they will have to underpay in another. In the stark world of the salary cap, NFL(1) teams live and die on their player selections. As Bill Polian, Vice Chairman of the Indianapolis Colts, says when discussing his choice of Peyton Manning over Ryan Leaf for the Colts quarterback position “If I had got that wrong…I’d be across the street, parking cars(2).” Five years after that selection, Manning was the named the NFL’s Most Valuable Player. Leaf no longer plays professional American Football.

Foreign billionaires do not fund most technology companies. Therefore, like the NFL, tech companies live and die on selection. 

There are two crucial differences when assessing how NFL teams and technology companies recruit:
Ø   NFL teams source and assess candidates continuously throughout the year. Technology companies source and assess candidates intermittently usually when they have a direct recruitment need.
Ø  Although NFL teams have extensive scouting teams (the equivalent of internal recruiters) the General Manager (the equivalent of the CEO) is constantly involved and often drives the process. In technology companies the CEO and executive team are often removed from the process after deciding on a job description until they take part in a final assessment.

In Michael Lewis’s book, The Blind Side, College Head Coach Nick Saban flew hundreds of miles to visit star high school American Football player Michael Oher at his home. While trying to persuade Oher to play for Louisina State University, he charmed Oher’s mother by commenting on the material of her curtains.

If technology companies change their mind-set from stop-start to constant and their executive team from hands off to hands on, the competitive rewards are bigger than an NFL team’s payroll.

Let’s take a hypothetical situation: A tech  firm with 100 employees, double-digit growth and the expectation that they’ll need to recruit at least twenty members of staff during the next year.  Now I would prefer every one of these employees to be involved in recruitment but some might call this unrealistic. Let’s just use the senior team of five: the CEO, CTO, COO, VP of Sales and VP of HR. Let’s conservatively say they work 250 days during that year and instead of spending whole days on recruitment they just spend twenty minutes purely on sourcing prospective candidates. Ten minutes on building a relationship with a source, ten minutes on speaking to a referral. They do this every day, without fail.
Over the course of the year they will collectively have spoken to 5,000 prospective candidates and because it was purely through referral their quality is to some extent prequalified. Instead of advertising and scrambling for recruits they have a pool of 5,000.

Most companies will complain that senior executives don’t have time for this. NFL executives are busy too. But there is a quantum leap in effort, professionalism, thoroughness, attention to detail and assessment between technology companies and the NFL.
Most technology companies will continue to recruit B players because recruiting A Players is so damn hard. However, the smart tech companies will see this as opportunity

[1] The NFL is the National Football League, the professional form of American football.
[2] From George Anders book, The Rare Find