All Things Hiring with Randy Street: Co-Author of “Who: The A-Method for Hiring” and Vice Chairman of ghSMART

My Guest

Randy Street is Vice Chairman of ghSMART, a leading global consulting firm that helps CEOs, boards, and investors build valuable companies through hiring and developing world class leadership teams. During Randy’s tenure, ghSMART has grown tenfold, and has been ranked by Forbes as one of America’s Best Consulting Firms from 2017-2020.

In collaboration with Geoff Smart, the firm’s chairman and founder, Randy co-authored Who: The A Method for Hiring, which went on to become a New York Times, Wall Street Journal, BusinessWeek, USA Today, and Publishers Weekly best seller. Soundview Executive Book Summaries gave Who the “Best 30 Business Books Award;” Shanghai Daily named it a “Top 5 Best Book in China;” Canada’s Globe and Mail named it the “#1 Best Business and Management Book of 2009;” and The Wall Street Journal named it a top seven “Best Advice” book for leaders in 2011. Randy also co-authored the Wall Street Journal bestseller, Power Score: Your Formula for Leadership Success.

Randy earned his MBA from Harvard Business School and a B.S. in Mechanical Engineering from Rice University.

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Specific Questions and When They’re Asked

Evaluating Teams that You Haven’t Personally Hired

CEO Succession

(3:40) Many new CEOs inherit their management teams from their predecessors. If the A-method for hiring is a big part of the CEO toolkit for evaluating new hires, what are the primary tools in a CEO’s toolkit for evaluating existing team members they’ve inherited from somebody else?
(9:40) For a new CEO succeeding a predecessor: Do the characteristics of the old CEO at all necessitate certain skills or traits or characteristics of the new CEO?

M&A

(11:55) For CEOs looking to grow via M&A, what are the people-related themes and threads that they absolutely must understand before acquiring another company?
(15:50) How should acquirers think about people or team issues that they identify within a target company? Are these opportunities for improvement or red flags telling them to cease their pursuit?

Hiring

(18:25) Where do you stand on CEOs interviewing every single new hire within their organization? Is this a sign of admirable dedication to people and culture, or a sign of ineffective delegation and a lack of trust in other members of the leadership group?
(21:55) Is there a company size threshold that would dictate which of the above approaches is more appropriate?
(23:35) Where do you stand on the use of personality profiles/tests as part of the hiring process? How reliable or predictive have you found them to be?
(26:25) Should a CEO include members of her management team in the interview process when hiring new members of that team? What if she disagrees with the team’s consensus recommendation?
(31:45) Many hiring mistakes seem to manifest when small companies hire executives from much larger companies. Why? Does this challenge or support conventional hiring wisdom?
(35:05) What’s the more common hiring mistake: Right-person-wrong-seat, or wrong-person-right-seat?

CEO Constitution & Performance

(34:45) You performed a study that analyzed hundreds of Private Equity-backed CEOs to see what CEO characteristics were most highly correlated to actual financial performance. For CEOs who are discovering or refining their own style, what are some practical lessons or principles that they can take away from this study?
(42:55) How to the top performing CEOs balance between decisiveness and correctness?

Post-Hire Considerations

(44:45) What are the basic tools, processes and structures that comprise an effective onboarding process, particularly for executive level hires?
(48:55) One of the most frequently cited regrets among CEOs is not terminating people quickly enough after an initial suspicion that a new hire wasn’t right for the job. How should a CEO balance a) giving the person the opportunity to improve; while b) being sufficiently decisive and not falling victim to this common mistake?
(54:10) In your own experience making hiring mistakes: What percentage of the time was your initial gut feeling towards a new hire correct versus incorrect?

Compensation and Interpersonal Dynamics

(57:25) Specific to compensation, are there any surprising or counter-intuitive lessons that you’ve learned in your 30+ years helping CEOs hire and develop talent?
(1:04:50) What are some common reasons for dysfunction within a management team? What should CEOs do to diagnose or address these common problems?

Conclusion

(1:08:35) If you could scream one thing from the proverbial mountaintops, and every SMB CEO in the world would hear any fully digest what you say, what would you say and why?