HBO’s acclaimed series Silicon Valley recently returned for its fifth season, and the struggles to build a startup -- Pied Piper -- into a billion dollar corporation are all too real at times. The events that transpire in the show are, of course, hyperbolized for entertainment, but the underlying decisions and assumptions made by character Richard Hendricks and his team can hold surprisingly valuable lessons for those willing to look for them.
Richard’s latest gaffe comes when Pied Piper tries to hire 15 new engineers. Instead of remaining active throughout the hiring process, Richard delegates the task to his lead engineers who can’t agree on anything. The pair’s absurd and unnecessary hiring standards prolong the process to such a degree that the CEO of competitor company Hooli swoops in to hire every one of Pied Piper’s candidates, only to hamstring the company’s ability to scale and go to market. The lack of viable candidates leads Richard down a path of questionable business decisions that go about as poorly as you would expect.
This is oddly reminiscent of a book I recently read, The CEO Tightrope, written by Joel Trammell, which examines the many aspects of operating a company as chief executive.
My own experience with growing a company has taught me the value of the CEO’s role in recruitment and review processes. I’ve made stellar hires that have perpetuated the culture and work standard I expect at my agency. I’ve also made questionable ones that I had to correct, and in doing so, I have recognized a few key considerations I and other executives need to keep in mind.
Executives at rapidly scaling companies face a myriad of urgent demands -- investor management, high-level sales calls, product meetings and strategy sessions -- that often take precedence over the nitty-gritty details of hiring new staff members.
Hiring and recruiting can seem like a great task to delegate to your chief operating officer or a headhunter, but the first few people you welcome into the company can make or break the foundation on which your future will be built. Hiring at all levels will define your culture and operations for the foreseeable future.
This also determines the type of CEO you will be. If you view hiring as a seat-filling exercise, you risk cultivating a group of employees that simply don’t align with your values or goals. Conversely, if you set unrealistic expectations for skills or experience, you risk fostering slow, ineffective hiring practices.
Finding the right balance will ultimately determine success. Set high expectations designed to achieve a clear business goal and play an active part in ensuring the person you hire is capable of achieving it at the standard you expect. Similarly, decide the level of training you’re comfortable implementing for a new employee if he or she does not have all the skills needed to accomplish specific tasks.
Don’t assume recruitment is complete when hiring is finished.
The best CEOs make time for recruiting. It can get harder and harder as a company grows, so a CEO might not be able to meet with every potential candidate for every open position, but it’s important that they meet with new talent as regularly as they can. For small or medium-size companies, this can be in the form of weekly coffee meetings or lunch with a potential candidate or even just taking the time to speak on the phone with someone who called to see if there was still an open position -- even if there isn’t.
Doing this feels self-indulgent to me at times, a luxury in which I probably shouldn’t be taking part when there are so many other pressing issues to address. But as my own company has grown in recent years, I’ve realized the importance of developing a farm team of talent from which you can draw when a position becomes available. It’s a worthy investment that will most likely prevent a company from making hasty hiring decisions and can also ensure that it is hiring the right person for the job.
Staff reviews are an extension of recruiting.
Most companies keep recruitment and the annual reviews of employees distinctly separate, and it’s no secret that many review processes for existing employees are outdated. Many businesses still have the typical 6- and 12-month reviews and meetings to discuss personal goals, progress, obstacles and concerns. Those reviews are great when employees are accomplishing those goals and bringing value to the business. When they aren’t, however, twice-yearly reviews don’t identify problems quickly enough and can lead to complacency, a lack of productivity and hostility among and between employees and managers.
In his book, Trammell offers a fresher, more modern approach to employee reviews -- the “A-B-C” approach. “B” serves as the benchmark for productivity: an employee who fulfills their responsibilities, is compatible with the company’s values and operates well within a team. “A” players are exactly what you think -- they exceed expectations, are invested in the company’s vision and are always thinking of new ways to grow the business. “C” players are those who underperform, drag their colleagues down with them with negativity or don’t fulfill expectations.
I’ve implemented a slightly more informal variation of this concept in my own business. As a small-but-growing agency, I'm able to sit down with each of my employees on a regular basis and have plenty of touch points with them through meetings, reviews of deliverables, one-on-ones and more. As we continue to scale, this type of employee review, which measures against agreed-upon goals and expectations, will become even more essential to our success as a company.
Executives -- especially at high-growth companies -- who play an active role in the recruitment and review process will inevitably save their enterprises from the headaches of improper hires or inadequate performance. Doing so will aid in customer and employee retention, revenue growth and, just as importantly, maintaining high-functioning employees that continuously add value.
Now, if only I could magically get Trammell’s book into Richard Hendricks’s hands.