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How to hire CEO :

7 Important Point How to Hire CEO:

We (Phi Edge Talent Enhancers LLP) have closed many CEO positions and apart from technically sound and right culture fit profiles, our clients had a host of other important requirements which I thought of as “unique and thought-provoking” and hence am sharing with you.

1. Compatibility with the BOD/ Promoters:

Many times, especially in the recent past, we have seen many cases where the CEO fails to deliver or worse is shunted out very fast because he/ she is not compatible with the values/ thought process of the BOD/ promoter. As a search firm, if there is a mismatch, then such candidates are not selected in the final round. Hence most of our clients have taken a lot of time to prepare a detailed docket on the mindset/ values/ thought process of the promoter and critical members of the board. Through psychometric tests and detailed behavioral anchored interviews (3-4 nos), we painstakingly find out whether the prospective candidate is compatible with the promoters and board members or not. Post our recommendation, the board members and promoters have a few rounds of informal discussions over lunch and dinner including a formal interview process and detailed reference checks before we bring the selected candidate on board.

2. Compensation benchmarking:

Though this may sound like a very routine step, there is a difference. The objective is to look at a median and a very high variable linked to company performance. The higher the comfort with high variable, the more confidence the BOD/ promoter and we have in the ability of the CEO. It also shows his/ her level of confidence in his/ her ability to put the business on a high trajectory. We also look for candidates who have grown in terms of compensation (fixed and variable) in their current organizations which proves that they have demonstrated performance on a consistent basis.

3. Look out for someone who is not looking out:

Candidates who are looking out are mostly those who are not happy about something which can mostly be due to non-performance, non-alignment, compensation-related, etc. Any or all of these reasons are recipes for disaster. On the other hand, candidates who are not seeking a change (despite having spent a long time in an organization)  are typically performers and are fully aligned with the board/ promoters and hence will be a good fit.

4. Culture integrator (if there is a foreign collaboration currently or for the future):

Accept it, we Indians have a different DNA compared to foreigners. However, our client wants a candidate who has the right Indian DNA to succeed in the Indian market and at the same time, is able to understand the expectations of the foreign partner so that he/ she can satisfy both stakeholders (Indian and foreign) and also align both stakeholders to a common cause and thus ensuring that the collaboration succeeds. If the CEO is for global operations i.e. Indian company having plants/ offices outside India, then the candidate should be well versed about the cultures/ DNA of the foreign employees and their legal/ societal rules, etc so that he can be successful in creating synergies between different locations/ cultures and ensure transfer of talent and technology, etc.

5. Strategic foresight:

           Most of the interviews for this position have a lot of impetus on the strategic foresight of the candidate. The candidate should be able to clearly chalk out a strategy for the next 5 and 10-year company growth, should be able to predict the way the industry will change/ emerge including new technological changes with trends and reasons why he/ she feels so. The candidate should be able to speak on blue ocean strategy and green shoots and should keep in mind the VUCA/ disruptive environment and his/ her coping mechanisms.

6. IT savvy with a clear bent on Finance and people mindset:

                 In this world of constant change where speed and accuracy are of the essence, the reliance on cutting-edge technology and IT savviness are of key prominence. The candidate should have a keen interest in IT and technology. Our belief is that you have to “love” IT and technology to be successful. At the same time, since great talent (attraction and retention) is the key to any successful business, it is necessary to be a people’s person to be able to retain such talent and genuinely feel for them. The candidate should also have a keen sense for finance i.e. understand balance sheets/ P&L at company/ business/ country-wise etc.

7. High energy levels:

           High energy levels are not always correlated to age. A prospect can have a very active life (eg sports) because it is more and more felt that such candidates can put long working hours, can take stress positively, can work and lead teams, can travel extensively, and can be lively and spread positivity among others.

All the best to corporates and aspiring CEOs!!
Anoop Ramachandran- MD

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