The Corporate Jack of all Trades

The Corporate Jack of all Trades

By Tim Holland

It seems to me that boards of directors should be doing some serious re-thinking about the qualities and experience they look for in senior management candidates. The key phrase here is Ashould be,@ as it will take a monumental effort to really change.

One of the problems is that many boards of directors are made up of the same people they are hiring: the CEO that has a high profile and has moved about a good deal. If you consider yourself successful at what you do you tend to seek a younger version of yourself for a similar position. That=s probably just human nature and extends to a good many diverse fields; its also the easy way out. The real challenge is to depersonalize the process.

For decades now we have been living with the concept of Aa manager, is a manager, is a manager@ and what is being managed is secondary. Business schools focus on management theory, techniques and skills development, which is as it should be but many boards of directors seem to have fallen into the trap of assuming that the industry being managed need not be a major element in the hiring process. Yes, there have been examples of the successful manager - manager process but there have also been a lot of failures.

Of late we have been treated to members of government trying to run universities, industrial company managers trying to run retail companies, lawyers trying to run banks, bankers trying to run industrial companies and the list goes on and on. There is no question that marquee CEO=s can succeed but the truth is they are the exception and not the rule. The real successes can be found among the companies that have produced long term steady growth and earnings; the companies that have seasoned management teams steeped in their industry and company culture. If there is not a clear succession path within the company then the current management has failed and, most certainly, the board of directors.

Hiring from inside should be encouraged and be a carefully planned and managed strategy. That should not imply that one needs to be with a company 15, 20 or 25 years to be a candidate. The whole concept of good management is to be able to identify good people early and test them as they learn and add to the culture and success of the company. When a company reaches out to a high profile executive in a non-related industry the words Afailure@ should be flashing in front of every investors eyes. A failure of current management, a failure of the board managing current management, a failure in the investment community for not seeing what was coming.

The other concept that seems mystifying is the idea of picking off the individual who lost out for the top spot at his or her current company. There are some basic questions that are just begging to be asked, the answers to which should also be sending up red flags: Is he leaving because he has been asked to leave (too big an ego, not a team player, wants a shot at being number one regardless of where)? Is he leaving because he wants to (same list of questions)? Does he not want to leave but will only if he is promised full and complete management control of the new company from day one (both CEO and Chairman) before he has proved he can do the job, not to mention the management contract that financially protects him against failure?

There is no question that ego=s are important but the AI@ factor really needs to be looked into. The board=s responsibility is supposed to focus on the company and when management adopts policies, procedures and strategies that are targeted to their own self interest alarms should be sounding loudly at every board meeting, unless, of course, the members of the board have put such programs into their own companies or are the beneficiaries of them.

The concept of AJack of all Trades Master of None@ has been around as long as managers and there is a good reason: it has proven to be true. There are those who would say that management itself is a trade but I have difficulty buying into that concept. Some of the more visible failures have been attributed to companies that have brought in managers at the very top who created more confusion, conflict and disruption due to having a management style that was a direct challenge to a corporate culture, in addition to a misreading of the company=s product and production capabilities.

The sign of a really successful company is one that grooms its management from within. It=s valuable to bring in new ideas from outside but starting at the top is usually not the best approach. Targeting the middle and upper middle and then training for the top would seem to be the ideal approach. There is also a saying that to be successful you should choose something you like to do and then focus on it. Unfortunately, there seems to be too much emphasis on management itself being the object rather than the thing being managed.

Note:

This opinion/essay is the property of the author. It is offered for use by individuals who are also free to copy and make it available to other individuals as they wish. Anyone wishing to make use of the material for commercial purposes must seek permission of the author, who can be reached at Impressions@Tim-Holland.com. Such permission will not be unreasonably refused.