The past year has been very exciting in my world of retained executive search, especially when working with privately held companies. My conversations with business owners and CEOs have been relatively consistent. They have weathered the storm, built solid cash reserves, and now want to determine how best to deploy that cash.
In these discussions, owners generally identify the following options for their available cash:
- Acquire a company
- Launch a new product
- Give additional compensation to key talent, which I like to define as those executives whom you cannot live without (or, more plainly speaking, those who will leave your business harmed if you arrive at work tomorrow and learn they are leaving)
- Upgrade executive talent
- Do nothing and keep the cash
Option three is interesting, and one I will address in a future blog post. For now, let’s discuss what happens if you choose option four: upgrading your existing talent.
Before you contact a retained search firm, here are a few important items to consider:
- Give serious thought to what exactly is frustrating you with the executive you plan to replace. For instance, you may be frustrated that your CFO does not effectively partner with sales and operations or cannot articulate financial terms to non-financial people.
- Identify the executives, board advisors, or outside service providers you can trust with your decision to replace an executive. Their input can be very valuable, since they know and understand your business.
- Ask these advisors which defects they have observed in the executive you plan to replace, and what skills you should look for in the search process. Ensure you are on the same page regarding the qualities that will be essential in the right candidate.
- Make sure you understand compensation parameters. Discuss the current state of the market with outside professionals to confirm that what you are trying to locate exists.
Going through these steps will put you in a good position to conduct a successful search. At this point, you will be ready to contact your trusted retained recruiter and begin the recruitment process!