Leadership Job #1: Finding, Shaping and Promoting Talent

I was recently asked to write an article focused on the Private Equity industry. The following is that article. I hope you will find elements that can help you in your business as well.

Do you remember when you first entered the Private Equity business? Maybe it was quite a while ago, maybe just a few years. One constant is that Private Equity is a daunting field. And while the pressures are great for senior executives and managers, they are equally so for those just entering the business. Sure, the situations are different but, well, you probably remember the intensity you experienced when you first got into the game.

Remembering that time as you began your career is an important element as you coach new associates, who present a lot of challenges for you. But when I coach managers, I ask them to first consider the challenges new team members face. From there, you can manage their activities, expectations and interactions from a place of understanding and compassion. Let me explain why that is important, not just for them but for your career as a leader.

What’s On Their Mind?

New employees have a lot on their minds. But a few key questions they ask themselves are:

·       How will I handle the pressure?

·       Will my boss help me or orphan me?

·       Am I just an analyst?

·       Will I have a development plan?

You’ll notice none of those questions have to do with salary/money. Ok, maybe they have that on their minds too, which is not a bad thing. But the questions above point to a mindset that says “I want to do well but, I need help getting there. I hope I’m not just left alone to figure out how.” That’s where you come in as a good manager.

Six Skills to Observe and Coach

Here’s the good news: people at all levels desire and appreciate coaching. Consistent coaching says; “I care about you, I believe in you.” Employees fail for a number of reasons but, I have found in my years as a leadership coach that the lack of coaching and direction is a big one. Avoid it at your, and the company’s, peril. Outlined below are six essential skills/behavior milestones to understand and coach so that you can transform your associates into a highly productive, cohesive, profitable team:

I. Provide Fast, Accurate Analysis

An associate’s world must initially focus on this. What’s important to observe at this time is your associate’s ability to capture what you’ve requested in the right spirit. Ask yourself this question as you analyze their potential:

·       Are they focused?

·       Do they accept the marching order with the right attitude?

·       Is their work product correct and clear?

II. Communicate Clearly and Concisely

Mission critical is an associate’s ability to clearly communicate their analysis. Many associates are challenged here. A great skill of any PE executive is his/her ability to teach their analysis to others. This teaching fosters dialogue amongst the team which is essential to lifting the team’s awareness of an issue. Notice an associate’s ease of communication.

·       Is their physical delivery strong?

·       Do they look at you and others when speaking?

·       Are they halting in their delivery?

·       Are they verbose when delivering a piece of analysis?

·       Do they self-edit too often?

·       Are they engaged or disengaged from their communication?

The answers to these questions are important to measure an associate’s propensity to develop as a PE executive. Essentially they need to represent you and your organization professionally and consistently. In your interactions with them, are they at ease? If they’re not comfortable speaking to you, how comfortable will they be with a portfolio company they are assigned to collaborate with?

III. Time Management

Notice how effectively your associates manage their time. Are they locked into doing A+ work at the expense of other analysis they need to produce? Being a perfectionist is detrimental to you and your company’s overall mission. It is possible that an associate driven to perfectionism only relies on the numbers not the overall strategy you’ve forged.

IV. Observe Without Prejudice

An important measure of an associate’s ability to develop into a senior associate/vice president is their degree of maturity and forbearance. By forbearance, I mean the ability to patiently restrain themselves when their opinion of an issue differs from others they must persuade.

An associate needs to develop relationships of trust, not silo themselves. They need to socialize ideas amongst their team to create a shared understanding of the direction the team will head. Much of an associate’s success here lies in how well they organize their thoughts, either informatively or persuasively. The more successful they are at this, the more people they will involve.

V. Being Self-Aware

Having self-awareness is critical to an associate’s growth. Doing a 360° Feedback Review is important along with establishing a clear development plan from this review for every associate you employ. This communicates to your associates you want certain behaviors to transform. It is here that you need to acknowledge inappropriate behavior and its impact on others. If an associate cannot observe/act without prejudice, they become a thorn in people’s side versus an approachable balanced resource.

Associates need to challenge people of different opinions to forward the strategy you’ve established. They must do this in a relational manner, not a condescending one. PE has always had this reputation. Realize that from the first “getting to know you” dinner the management team is skeptical of you. Once you’ve mutually set the strategic course of their company that management team may still alter what you’ve agreed to.

It is your associates who will need to see this “iceberg” first and relationally communicate it to the management  team. Notice the pattern of an associate not “getting along” with others. It’s a sign that he/she may not ever succeed collaborating with people.

VI. Framing and Delivering a Recommendation

A sure sign of an associate’s growth and readiness for promotion is their ability to frame and deliver a recommendation to varied listeners. This is an important skill. Finding the correct aperture of a person takes maturity and humility. An associate’s ability to correctly synthesize an analysis is mission critical to their development. From this skill they then must hold a management team accountable for their direction and strategic plan. This is the skill of persuasion. Can they forge a relational climate where they deliver their recommendation in such a way that it’s understood and accepted? Succeeding at this illustrates insight and maturity.

In summary, people buy people first, product/analysis second. Your firm rises and lowers from this realization. Every person on your team represents you and needs to comport themselves accordingly. Your challenge is to define and operationalize this.