The Gift of Feedback, Part IV

I wrote a few weeks ago about my live 360 – the first time I’ve ever been in the room for my own review discussion.  I now have a development plan drafted coming out of the session, and having cycled it through the contributors to the review, I’m ready to go with it.  As I did in 2008, 2009, and 2011, I’m posting it here publicly.  This time around, there are three development items:

1. Continue to spend enough time in-market.  In particular, look for opportunities to spend more time with direct clients.  There was a lot of discussion about this at my review.  One director suggested I should spend at least 20% of my time in-market, thinking I was spending less than that.  We track my time to the minute each quarter, and I spend roughly 1/3 of my time in-market.  The problem is the definition of in-market.  We have a lot of large partners (ESPs, ISPs, etc.) with whom I spend a lot of time at senior levels.  Where I spend very little time is with direct clients, either as prospects or as existing clients.  Even though, given our ASP, there isn’t as much leverage in any individual client relationship, I will work harder to engage with both our sales team and a couple of larger accounts to more deeply understand our individual client experience.
2. Strengthen the Executive Committee as a team as well as using the EC as the primary platform for driving accountability throughout the organization.  On the surface, this sounds like “duh,” isn’t that the CEO’s job in the first place?  But there are some important tactical items underneath this, especially given that we’ve changed over half of our executive team in the last 12 months.  I need to keep my foot on the accelerator in a few specific ways:  using our new goals and metrics process and our system of record (7Geese) rigorously with each team member every week or two; being more authoritative about the goals that end up in the system in the first place to make sure my top priorities for the organization are being met; finishing our new team development plan, which will have an emphasis on organizational accountability; and finding the next opportiunity for our EC to go through a management training program as a team.
3. Help stakeholders connect with the inherent complexity of the business.  This is an interesting one.  It started out as “make the business less complex,” until I realized that much of the competitive advantage and inherent value from our business comes fom the fact that we’ve built a series of overlapping, complex, data machines that drive unique insights for clients.  So reducing complexity may not make sense.  But helping everyone in and around the business connect with, and understand the complexity, is key.  To execute this item, there are specifics for each major stakeholder.  For the Board, I am going to experiment with a radically simpler format of our Board Book.  For Investors, Customers, and Partners, we are hard at work revising our corporate positioning and messaging.  Internally, there are few things to work on — speaking at more team/department meetings, looking for other opportunities to streamline the organization, and contemplating a single theme or priority for 2015 instead of our usual 3-5 major priorities.

Again, I want to thank everyone who participated in my 360 this year – my board, my team, a few “lucky” skip-levels, and my coach Marc Maltz.  The feedback was rich, the experience of observing the conversation was very powerful, and I hope you like where the development plan came out!

(Post 3 of 4 in the series of Scaling CRO’s- the other posts are When to Hire your First Chief Revenue Officer and What does Great Look like in a Chief Revenue Officer).

If you’ve hired a “great” CRO (see previous post) you might think that you’re set for a long time and that the great CROs are also able to scale. Not always, and you’ll have to check to make sure that your CRO is scaling and growing as much as your company. I’ve found that there are several telltale signs that your CRO isn’t scaling and fortunately, they are easy to spot and easy to correct.

First, if your CRO gravitates to being an individual contributor sales rep and focuses on closing big deals instead of mentoring sales managers and sales reps to do that work on their own, that could be a sign that your CRO lacks the confidence to be a true executive.  The risk in being an executive is not that you can’t do the work, it’s that you don’t trust your team to do the work. To be clear, sometimes the role of a sales leader (or a CEO) is to swoop in and help close a big deal–sometimes.  But CROs who can’t shake their addiction to closing deals almost never build enough of that muscle into their organization and end up creating unhealthy dependency on themselves. Worse, they do not create a career path for others in the sales organization to learn and take risks. 

Second, I’ve found that a CRO who gets the sales commission plans out in March or April instead of January or early February is maybe someone who can’t scale.  While it’s true that, in a lot of businesses, it’s very difficult to get sales commission plans out until after the year starts, getting them out after late February is a sign that your CRO doesn’t have enough of a grip on numbers, isn’t partnering effectively with finance, doesn’t care enough about their people, or isn’t good at prioritizing the important over the urgent when needed. Obviously, if this happens once it’s not a big deal, but if you find that the CRO is the last person on your team to get their plans together year after year, that’s a telltale sign that maybe they’re in over their heads. You might hear them say, “They’ll all be fine, they know I’ll take care of them, the plan is a lot like last year’s.” That might be okay for the majority of the sales team but it won’t be good enough for the best reps who are constantly doing Sales Math in their heads.  It’s a lot easier to mentor or CRO, or find a new one, than to build a new team of dedicated sales reps.

Finally, a sign that your CRO isn’t scaling is if they regularly deliver surprises at the end of the quarter – both good and bad surprises.  A “surprise” every once in awhile is not a big deal, but regular surprises are a big deal and that tells you something important about the CRO: They might be incapable of scaling and the surprises are coiming because your CRO doesn’t have a good grip on the pipeline and in particular on larger deals. Either they don’t have a grip on the pipeline or they are bad at managing expectations; or both!

( You can find this post on the Bolster Blog here)

My name is Matt Blumberg. I am a technology entrepreneur and business builder based in New York City. I am CEO of Markup AI, the leading provider of Content Guardian Agents to companies of all sizes looking to scale their use of AI to generate content smartly and safely. We are defining a new category in the Generative AI space and crushing it.

Before that, I started a company called Bolster, which was an on-demand executive talent marketplace.  We created a new way to scale executive teams and boards aimed at early and mid-stage tech companies. The business sort of worked and sort of didn’t work. We wound it down in 2025 and decided to focus on helping the portfolio companies we invested in via Bolster Ventures and help our friends with talent referrals on a more informal basis.

My longest career stint was Return Path, a company I started in 1999, which we sold in 2019.   We created a business that was the global market leader in email intelligence, analyzing more data about email than anyone else in the world and producing applications that solve real business problems for end users, commercial senders, and mailbox providers.  In the end, we served over 4,000 clients with about 450 employees and 12 offices in 7 countries.  We also built a wonderful company with a signature People First Culture that won a number of awards over the years, including Fortune Magazine’s #2 best mid-sized place to work in 2012.

Early in my career, I ran marketing and online services for MovieFone/777-FILM (www.moviefone.com), now a division of AOL. Before that — I was in venture capital at General Atlantic Partners (www.gapartners.com), and before that, a consultant at Mercer Management Consulting (www.mercermc.com). And I went to Princeton before that.

Based on this blog, I wrote a book called Startup CEO:  A Field Guide to Scaling Up Your Business, which was published by Wiley in 2013 and updated in 2020. I followed that by co-authoring a book with a number of my fellow executives from Retutrn Path and Bolster called Startup CXO: A Field Guide to Scaling Up Your Company’s Critical Functions and Teams; as well as the second edition of Startup Boards: A Field Guide to Building and Leading an Effective Board of Directors along with Brad Feld and Mahendra Ramsinghani. I hosted a podcast called The Daily Bolster, with over 200 micro-episodes (mostly 5-6 minutes long) where I interview other CEOs to share their stories and hacks.

I have been married for over 25 years to Mariquita, who is, as I tell her all the time, one of the all-time great wives. We have three great kids now in their late teens, Casey, Wilson, and Elyse.

I have lots of other hobbies and interests, like coaching my kids’ baseball and softball teams; traveling and seeing different corners of the world; reading all sorts of books, particularly about business, American Presidential history, art & architecture, natural sciences (for laymen!), and anything funny; cooking and wishing I lived in a place where I could grill and eat outdoors year-round; playing golf; lumbering my way through the very occasional marathon, eating cheap Mexican food; introducing my kids to classic movies; and playing around with new technology. I hosted a limited edition podcast series called Country Over Self which explored the topic of virtue in the Oval Office along with a dozen prominent presidential historians.

IF YOU WANT TO UNDERSTAND WHAT THIS BLOG IS ALL ABOUT, read my first two postings: You’re Only a First Time CEO Once, and Oh, and About That Picture, as well as my updated post when I relaunched the blog with its new name, StartupCEO.com.

Last week, I wrote about surrounding yourself with the best and brightest.  Next in this series of posts  is all about Creating an environment of trust.  This is closely related to the blog post I wrote a while back in my series on Return Path’s Core Values on Transparency.  At the end of the day, transparency, authenticity, and caring create an environment of trust.

Some examples of that?

• Go over the real board slides after every board meeting – let everyone in the company know what was discussed (no matter how large you are, but of course within reason)
• Give bad news early and often internally.  People will be less freaked out, and the rumor mill won’t take over
• Manage like a hawk – get rid of poor performers or cultural misfits early, even if it’s painful – you can never fire someone too soon
• Follow the rules yourself – for example, fly coach if that’s the policy, park in the back lot and not in a “reserved for the big cheese” space if you’re not in Manhattan, have a relatively modest office, constantly demonstrate that no task or chore is beneath you like filling the coke machine, changing the water bottle, cleaning up after a group lunch, packing a box, carrying something heavy
• When a team has to work a weekend , be there too (in person or virtually) – even if it’s just to show your appreciation
• When something really goes wrong, you need to take all the blame
• When something really goes right, you need to give all the credit away

Perhaps a bit more than the other posts in this series, this one needs to apply to all your senior managers, not just you.  Your job?  Manage everyone to these standards.

I heard two great lines recently applied to CEOs that are thought provoking when you look at them together:

You have to care about everything more than anything

and

You can do anything you want but not everything you want

Being a CEO means you are accountable for everything that happens in your organization. That’s why you have to care about everything. People. Product. Customers. Cash flow. Hiring. Firing. Board. Fundraising. Marketing. Sales. Etc. You can never afford not to care about something in your business, and even if there’s a particular item you’re more focused on at a given point in time, you can never get to a place where you care about any one particular thing more than the overall health of the business.

But caring is different than doing. As a CEO, even if you’re hyper productive, you can’t do everything you want to do – and you shouldn’t. Others in your organization have to take ownership of things. And you can’t burn yourself out or spread yourself too thin. But you do have the prerogative of doing anything you want in and around your company as long as you do it the right way.

This second line is particularly interesting when applied to a CEO’s activities outside of work. As with anyone, it’s critical for CEOs and founders to have outside hobbies and interests, time for friends and family, down time, and even non-work work time like sitting on outside boards. Staying fresh and “sharpening the saw” is good for everyone. A CEO should be able to do anything she wants outside of work — from sitting on outside boards to being in a band. But a CEO can’t do everything she wants outside of work while still devoting enough time and attention to work.

Taken together, the two lines are interesting. As a CEO, you have to care about everything, but you can’t do everything. That pretty much sums up the job!

People Should Come with an Instruction Manual

Almost any time we humans buy or rent a big-ticket item, the item comes with an instruction manual.  Why are people any different?

No one is perfect.  We all have faults and issues.  We all have personal and professional development plans.  And most of those things are LONG-TERM and surface in one form or another in every single performance review or 360 we receive over the years.  So shouldn’t we, when we enter into a long-term personal or professional employment relationship, just present our development plans as instruction manuals on how to best work with, live with, manage, us?

The traditional interview process, and even reference check questions around weaknesses tend to be focused on the wrong things, and asked in the wrong ways.  They usually lead to lame answers like “my greatest weakness is that I work too hard and care too much,” or “No comment.”

The traditional onboarding process also doesn’t get into this.  It’s much more about orientation — here’s a pile of stuff you need to know to be successful here — as opposed to true onboarding — here’s how we’re going to get you ramped up, productive, integrated, and successful working here.

It’s quite disarming to insist that a candidate, or even a new employee, write out their instruction manual, but I can’t recommend it highly enough as part of one or both of the above two processes.  Since everyone at Return Path has a 360/Development Plan, I ask candidates in final interviews what theirs looks like in that context (so it’s clear that I’m not trying to pull a gotcha on them).  Failure to give an intellectually honest answer is a HUGE RED FLAG that this person either lacks self-confidence or self-awareness.  And in the onboarding process, I literally make new employees write out a development plan in the format we use and present it to the rest of my staff, while the rest of my staff shares their plans with the new employee.

As I’ve written in the past, hiring  new senior people into an organization is a little like doing an organ transplant.  Sometimes you just have to wait a while to see if the body rejects the organ or not.  As we get better at asking this “where’s your instruction manual?” question in the interview process, we are mitigating this risk considerably.  I’m sure there’s a whole parallel track on this same topic about personal relationships as opposed to professional ones, but I’ll leave that to someone else to write up!

(This post also appeared on Bolster.com and builds on last week’s post where I introduced my new startup, Bolster)

Welcome to Bolster, the on-demand executive talent marketplace. We are creating a platform that is the new way to scale an executive team and board.

We believe that startups and scaleups are not average companies. Their rapid growth means their appetite for talent constantly outstrips their budget — and that they can’t spend months searching for it. Their dynamic industries dictate that they keep pace with bigger and better funded competitors. Their leadership teams — the people and the roles — are always changing. Their CEOs spend a ton of time hiring and coaching their leaders and shaping the complexion and direction of the team. They stress out about big expensive new executive hires when sometimes they just need to level-up an existing manager or “try before they buy.” Their Boards frequently jump in to help, but those efforts can be a little ad hoc and inefficient.

We believe that experienced executives working as consultants is the wave of the future. The number of career executives who work flexibly and on-demand for a living is skyrocketing in recent years. People are more often “between things” and are interested in plugging into shorter-term engagements while continuing to look for their next full-time role. People are retiring younger, yet wanting to keep contributing. And even fully-employed execs like to advise companies and serve on Boards. Whether these people are career consultants or are looking for a “side hustle” or just to pay something forward to a future generation of leaders, they all have two common problems: finding work is time consuming and they’re often not good at or don’t like doing it; and managing their back office, everything from insurance to legal to tax to marketing, is a drain on time that could otherwise be spent with clients or family.

We believe that a new kind of talent marketplace is needed to meet the unique and complex requirements of both audiences — the freelance, or flexible, seasoned executive, and the startup or scaleup CEO who thinks holistically about his or her leadership team and carefully tends them like a garden. We are building a platform to make instant, tailored, vetted matches between talent and companies without the randomness of a job board and without the theater, long lead times, and cost, of a full service agency 

Service marketplaces like ours work best when they help their stakeholders solve other meaningful, related problems.In this case, we believe that the need for back office services will help executive consultants focus on more important things. And we believe that CEOs need lightweight and dynamic support in thinking through the composition and skills required of their executive teams both today and 6-18 months in the future.

That is the essence of the business we are building. A business to quickly match awesome companies with awesome freelance executives and to help both sides be better at what they do. We are here to make it easier for you to:

• Bolster your executive team. For our Clients, our pledge to you is that we will quickly and cost-effectively fill the gaps in your leadership ranks (whether interim, fractional, advisory, board, or project-based) with trusted, curated talent, and that we will give you a platform to evaluate your overall leadership team and help you think through your future needs as your company evolves. Think of us as a shortcut to scaling your leadership team.
  
• Bolster your board. The best boards are the ones with multiple independent directors who come from diverse backgrounds with diverse points of view. We also pledge to our Clients that we will find great matches to help fill out their boardrooms as their strategic advisory needs change over time.
  
• Bolster your work. For our Members, our pledge to you is that we will find you the right kind of interesting clients and help you manage your back office so you can focus on your work (and all the other important things in your life!).
  
• Bolster your portfolio. For our Portfolio Partners, VC and PE board members, our pledge to you is that we will make it easier for you and your firm to both drive successful on-demand executive placements for your portfolio company CEOs, and to manage and expand your firm’s network of flexible executive talent. 

We are an experienced team of entrepreneurs and operators who have scaled multiple businesses throughout our careers. All of us worked together as part of the leadership team at Return Path, a leading email technology company that we scaled from 0 to $100mm in revenue and 500 employees in 12 locations around the world while winning numerous Employer of Choice awards. All of us have independent experience scaling other businesses, small and large, public and private. All of us have experience being on-demand executives as well — whether interim, fractional, advisory, project-based, or board roles, we know the landscape of both our members and our clients. 

We’ve all dealt with the stress of having product-market fit and market opportunities but not being able to capitalize on those opportunities because we were missing key talent. And we’ve tried everything from executive search firms (expensive, time-consuming, and slow), to leveling up people (will they be able to grow into the role?), to leaning in to our board (hit or miss, inefficient). Heck, we’ve been desperate enough to follow up on the “my cousin’s boyfriend has an uncle, and he might know someone” lead.

We believe there is a better way for startups and scaleups to find executive talent. Along the way, I published a book about scaling startups called Startup CEO: A Field Guide to Scaling Up Your Business that has sold over 40,000 copies to CEOs around the world. And our whole team is working on a new book called Startup CXO: A Field Guide to Scaling Up Your Teams, which is coming out in early 2021. Our team has a maniacal focus on helping startup teams scale and flourish and on helping leaders develop into the best version of themselves. That’s what we’re all about. 
Plus, we have an amazing group of investors behind us who know how to grow businesses like ours and have incredible reach into the startup and scaleup world. More about that later. For now, we are excited to soft launch Bolster and begin unleashing the power of on-demand executive talent to our Clients. Thank you for being on this journey with us. If you’re interested in the somewhat unusual story of how the company was founded, it’s here.

Sometimes the work we do as CEOs, leaders, management teams is glamorous, and sometimes it’s not. But it all matters. One thing we tried to do at Bolster this past year is to really amp up employee benefits. The war for talent is real. The Great Resignation is real. Sometimes startups like ours have natural advantages in terms of attracting and retaining talent such as being made up of letting people in on the ground floor of something, having small teams so individual impact is easy to see, being mission-driven and full of creativity and purpose, and having equity to give that could be very valuable over time. But sometimes startups like ours have natural disadvantages around recruiting like having less certain futures, being relatively unknown to potential employees, being unable to pay huge salaries in the face of the Googles and Facebooks of the world, and having limited career path options since the teams are so small.

My co-founders and I have always been big believers in innovating People Practices. We did an enormous amount of work around this at our prior company, Return Path, which has been pretty well documented and we feel was very successful. Things like our People First philosophy of investing in our team, an extraordinary amount of transparency in the way we ran the company, a sabbatical policy, an open vacation policy, a peer recognition system, 360 reviews (I’ve written about this a lot, but I don’t have a great single post on it – this one is good enough and has some links to others), and an open expense policy.

Most of those things, when we started doing them 20 years ago, were revolutionary. We had our own version of the then-infamous Netflix deck even before we saw the Netflix deck. But today, many of those people practices are more common, not quite table stakes, but not exactly unique either. So this year when we set out to do our annual retrospective and planning process, we decided to try to innovate on a fairly standard topic for people, employee benefits. Although there’s not a lot of room for innovation on this topic, we are doing a few things that new and existing employees alike have told us are noteworthy, so I thought I would share them here.

We started by getting the basics right. We have a good solid health plan, dental plan, vision, transit benefits, etc. And we are paying 100% of the basic plan and allowing employees to pay more for a premium plan. That’s not the innovative part.

Next, we decided to max out the HSA contribution. HSAs and FSAs are some of those things that people don’t really think about, or they think “oh that’s great, employees can set aside health care expenses pre-tax.” But employer contribution to them matters, especially because the plans are portable. So we are giving people whatever the legal limit is towards their HSA, something in the neighborhood of $7k/year for a family plan or $3k for an individual plan. This is real money in people’s pockets, and it takes away from fears and concerns about health and wellness.

Next, we decided to begin addressing two things we felt were always weird quirks or inequities in benefit plans. One is the fact that employees who DO take advantage of your benefits program essentially get a huge additional amount of compensation than employees who DON’T because they are on their spouse’s plan. So we decided to give all employees who DON’T use our benefits program a monthly stipend. The amount doesn’t quite equal what we would be paying for their health insurance (which varies widely for employees based on single vs. family plans), but it’s a material number. So those people who aren’t on our plan still receive a healthcare proxy benefit from us.

Another (and the final thing I’ll talk about today) was instituting a 401k match, but doing so with a dollar cap instead of a percentage cap. Percentage caps FEEL fair, but they’re not fair since the company ends up paying more money towards the retirement plan of the people who earn the most money and who presumably need that benefit the least. The IRS tries to help do this leveling with their nondiscrimination testing, but that doesn’t come close to achieving the same outcome because it’s about employee contributions, not employer matches. By instituting a dollar cap, we are making the statement that we value all employees’ retirements equally. Incidentally, this simple change is proving to be very difficult to implement since our systems and benefits providers aren’t set up to do it, but we will persevere and find workarounds and get it right.

Investing in our people is critical to who we are as a business, and if you take your business seriously, it should be in your playbook as well. Benefits sound like a dumb area in which to innovate since they’re very common across all companies other than the percentage of the premium covered…but there’s still room for creativity even in that field.

It’s a Little Weird When Your Best Customer Experience of the Week is with the Government

Mariquita has been doing a lot of personal admin lately for us.  This week had a little surprise in it.

Verizon continues to be one of the most awful, painful vendors in the history of the universe.
At least their phone network is solid, since any interaction with the people at the company is so bad.  We came to the conclusion this week that they actually do some things which aren’t just the usual bad customer service or outrageous pricing — they have some policies in place that are literally designed to systematically rip off their customers.  The one we ran into was (after 45 minutes on and off hold, of course) that the data plans for Treos are prepaid for a month, but when you go to cancel your data plan, they tell you they HAVE TO cancel it the day you call, even if you have days or weeks left on your plan, and they CAN’T issue a refund for unused days.  But if you complain loudly enough, a supervisor can keep your service active through the end of your pre-pay, or can issue you a refund.  So in fact, they are telling their customer service reps to lie to their customers in the hope that their customers don’t push back so they can keep your money while not delivering your service.

She had a similarly bad experience dealing with our insurance company about car insurance.  State Farm just has a ridiculous set of procedures in place around changing car insurance that cause their customers to jump through hoops several times over for no apparent reason at all.  There have been several stupid things, but this week was needing to take a brand new car to get inspected before insuring it within three days of buying it.  But we had to take it to a specific mechanic on the “approved list” to get it inspected.  That place required an appointment (which meant two trips).  It couldn’t be done at the dealer.  Then the actual inspection lasted about 30 seconds.  Maybe they were just making sure there was an actual car, not a pretend car.  Harry Potter, beware.

And then came the surprise — Mariquita’s trip to the DMV to trade in our old license plates.  She was in and out in under 5 minutes with a prompt, efficient, friendly person handling the transaction with a smile.  Wonders never cease.

It doesn’t take a lot to be great at customer service, just the right mindset and culture.  It’s amazing that Albany (or at least a small pocket therein) seems to have figured that out before some of the biggest companies around.

There’s been a growing cry for tech companies to add diversity to their leadership teams and boards, and for good reason. Those two groups are the most influential decision making bodies inside companies, and it’s been well documented that diverse teams, however you define diversity — diversity of demographics, thoughts, professional experience, lived experience — make better decisions. 

Gender, racial, and ethnic representation in executive teams and in board rooms are not new topics.  There’s been a steady drumbeat of them over the last decade, punctuated by some big newsworthy moments like the revelations about Harvey Weinstein and the tragic murder of George Floyd.  

It’s also true that in people-focused organizations, and most tech companies claim to be just that, it’s beneficial to have different types of leaders in terms of role modeling and visibility across the company. As one younger woman on my team years ago said, “if you can see it…you can be it!”

My company Bolster is a platform for CEOs to efficiently build out their executive teams and boards. But while nearly every search starts with a diversity requirement, many don’t end that way. 

Here’s why, and here’s what can be done about it. 

For boards, the “why” is straightforward. Board searches are almost never a priority for CEOs. They’re viewed as optional. Bolster’s Board Benchmark study in 2021 indicated that only a third of private companies have independent directors at all;even later stage private companies only have independent directors two-thirds of the time. That same study indicated that 80% of companies had open Board seats. The comparable longitudinal study in 2022 indicated that the overwhelming majority of those open board seats were still open. 

Independent directors are usually the key to diversity, as the overwhelming majority of founders and VCs are still white and male. It takes a lot of time and effort to recruit and hire and onboard new directors, and in the world of important versus urgent, it will always be merely important. Without prioritizing hiring independents, board diversity may be a lofty goal, but it’s also an empty promise. I wrote about my Rule of 1s here and in Startup Boards – I wish more CEOs and VCs took the practice of independent boards and board diversity seriously. The silver lining here is that when CEOs do end up prioritizing a search for an independent director, they are increasingly open to diverse directors, even if those people have less experience than they might want. That openness to directors who may never have been on a corporate board (but who are board-ready), who may be a CXO instead of a CEO, is key. Of the several dozen independent directors Bolster has helped match to companies in the past year, almost 70% of them are from demographic populations that are historically underrepresented in the boardroom.

Diversity is stalling for Senior Executive hiring for the opposite reason. Exec hires are usually urgent enough that CEOs prioritize them. And they frequently start their searches by talking about the importance of diversity. But Senior Executives are much more often hired for their resume than for competency or potential. Almost all executive searches start with some variation of this line, which I’m lifting directly from a prior post: “I want to hire the person who took XYZ Famous Company from where I am today to 10x where I am today.” The problem with that is simple. That person is no longer available to be hired. They have made a ton of money, and they have moved beyond that job in their career progression. So inevitably, the search moves on to look for the person who worked for that person, or even one more layer down…or the person who that person WAS before they took the job at XYZ Famous Company. Those people may or may not be easy to find or available, but they feel less risky. In the somewhat insular world of tech, those candidates are also far less likely to be diverse in background, experience, thought, or, yes, demographics.

Running a comprehensive executive search based on competencies, cultural fit, scale experience, and general industry or analogous industry experience is much harder. It takes time, patience, digging deeper to surface overlooked candidates or to check references, and probably a little more risk taking on the part of CEOs. And while CEOs may be willing to take some risk on a first-time independent director, fewer are willing to take a comparable level of risk on an unproven or less known executive hire. 

For some CEOs, the answer is just to take more risk — or more to the point, recognize that any senior hire carries risk along a number of dimensions, so there’s no reason to prioritize your narrow view of resume pedigree over any critical vector. For others, the answer may be to bring the focus of diversity in senior hires to “second level” leaders like Managers, Directors, or VPs, where the perceived risk is lower, and the willingness to invest in training and mentorship is higher. Those people in turn can be promoted over time into more senior positions. 

Not every executive or board hire has to be demographically diverse. Not every executive team or board has to have individual quotas for different identity groups, and diversity has many flavors to it. But without doing the work, tech CEOs will continue to bemoan the lack of diversity in their leadership ranks, and miss out on the benefits of diverse leadership, while not taking ownership for those efforts stalling.

Political versus Corporate Leadership, Part II: Admitting Mistakes

The press conference this past spring where President Bush embarrassingly refused to admit that he had ever made any big mistakes, other than to reiterate his gaffe at trading Sammy Sosa when he owned the Texas Rangers, brings up another issue in this series: is it good for leaders, both political and corporate, to admit mistakes?

On the corporate side, I think the ability to admit a mistake is a must. Again, I’ll refer back to Jim Collins’ books Good to Great and Built to Last, both of which talk about humility and the ability to admit mistakes as a critical component of emotional intelligence, the cornerstone of solid leadership. And in another great work on corporate leadership, The Fifth Discipline, writer Peter Senge talks about “learning systems” and the “learning organization” as far superior companies. My experience echoes this. Publicly admitting a mistake, along with a careful distillation of lessons learned, can go a long way inside a company to strengthening the bond between leader and team, regardless of the size of the company.

But in politics, the stakes are higher and weirder — and the organization is a nation, not a company. Publicly admitting a single mistake can be a leader’s downfall. It’s too easy these days for political opponents to seize on a mistake as a “flip flop” and turn a candidate’s own admission into a highly-charge negative ad.

There was a fantastic op-ed in The Wall Street Journal back on April 15 on this topic, which unfortunately doesn’t have an available link at the moment, entitled “Bush Enters a Political Quandary As He Faces Calls for an Apology.” I’ll try to both quote from and summarize the article here since it’s central to this topic:

“For a politician, is an apology a sign of weakness or strength? That is the debate now swirling around President Bush after a prime-time news conference in which he refused reporters’ invitations to acknowledge any specific mistakes in handling the issue of terrorism or offer an apology to Sept. 11 victims’ families. Mr. Bush deflected the invitation, saying, ‘Here’s what I feel about that: The person responsible for the attacks was Osama bin Laden.’ Mr. Bush’s quandary is a time-honored struggle for politicians. While some have found a public apology helps them out of a tough spot, others discovered it can fuel more criticism. So far, there isn’t a definitive answer.”

The article goes on to say that while Harry Truman’s “the buck stops here” mentality was de rigeur in the Beltway for a while (through Kennedy’s Bay of Pigs fiasco and Reagan’s poor handling of Beirut), nowadays, apologies are a dreaded last resort. The reason? The rise of partisanship and the use of ethics and congressional or special counsel investigations used to humiliate or defeat political opponents by raising the spectre of corruption. The examples? Gingrich’s struggles in 1996 over his book; Clinton’s ridiculous linguistics machinations (“it depends what the definition of ‘is’ is”) around the Lewinsky scandal; and Lott’s downfall over segregationist comments.

The piece wraps up by saying that “Mr. Bush was backed into the apology quandary by one of his administration’s toughest critics, former White House terrorism expert Richard Clarke…Since then, White House officials have been pressured to do likewise [apologize to victims’ families about the government’s failings on 9/11] — or explain why they won’t…[but] aides are convinced that admitting error would only embolden Mr. Bush’s critics in the Democratic Party and the news media.”

So the question is: would Bush be better off by saying “Sorry, folks, we thought there were WMD in Iraq, but it turns out we were wrong. And we miscalculated how difficult it would be to win the war, how many troops it would take, and how many lives would be lost. I still feel like it was right for us to go to war there for the following four reasons…”?

I’m not sure about that. He’d certainly be more intellectually honest, and a number of people in intellectual circles would feel better about him as a leader, but my guess is that he thinks it would cost him the election in today’s environment. My conclusion is that today’s system is discouraging politicians from admitting mistakes, and that it will take an exceptionally courageous leader (neither Bush nor Kerry as far as I can tell) to do so.

In the end, while humility appeals to many people in a leader, it’s not for everyone. Fortunately for us, CEOs don’t have to run for office and most CEOs don’t have to face some the same level of public, personally competitive, and media scrutiny that politicians do. Now that’s an interesting conclusion that I didn’t intend at the beginning of the post — being a good political leader and being a good politician are sometimes deeply at odds with each other.

Next up in the series: Not sure! Any ideas? Please comment on the blog site or by emailing me.