There is a significant difference between a private company and a public one. It goes far beyond ownership; everything is different, creating unique challenges when private-owned companies consider their future. The talent requirements for a privately owned organization are as critical as those of a public company, but often, when filling senior roles, the importance of these differences is overlooked.
Recognizing these differences will enhance success when a private company considers leadership candidates working in a public company.
Time Horizon
Public companies live by their quarterly reports. They are accountable to their shareholders, many of whom expect prompt outcomes. Balancing long-term goals with short-term expectations is an ongoing challenge that impacts every decision.
Private companies have fewer shareholders, often with similar goals, which typically have a longer-term perspective. Decisions can usually prioritize the future, and while a sense of urgency is required, the short-term aspect is frequently tactical, assuring the longer-term objectives.
People
The transition leaders make when going from a public to a private company is callenging. While many find the idea of working in a longer-term focused organization attractive, the widely accepted belief is that the failure rate of this type of move is as high as 60-70%. Although there is no dedicated research that statistically supports these figures for public-to-private transition, it is an indication of how difficult that move is. Private companies must recognize this difference and consider it an integral part of recruiting. Here are three critical considerations:
- Look beyond the successful results candidates demonstrate to learn how they accomplished it. How significant were the available resources, and how does this compare with your organization.
- Understand the decision-making process in the candidates’ current/prior organization. How many others are involved, and how fast did it move? Will the candidates have challenges being decisive and moving quickly?
- What personal attributes do the candidates have that indicate they can quickly adapt? Communications within a public company often have structure and specific expectations, while many private companies may be less formal and broader. Communication is critical in smaller private companies with fewer stakeholders.
Approach
Recruiting talent into a private company requires focusing on the individuals you are considering. Pay attention to the characteristics that made them successful. There are instances when the “culture” made success possible, with the individual contributing but not driving the success. Obtain this information with an effective, structured interview focusing on required personal traits for a fast-acting culture.
Agility: How does the candidate adapt to changing situations?
Decisiveness: Is the candidate comfortable making decisions with limited data, recognizing that speed is critical?
Emotional Intelligence: Does the candidate communicate effectively and consider the impact on others in their thinking process? Can they build strong interpersonal relationships?
Learning/Curiosity: Does the candidate consistently question and search for better ways to accomplish goals?
Personal characteristics may be identified and assessed through various psychometric evaluations, offering the interviewer a systematic approach to understanding how the candidate will perform within the organization. They are a valuable tool when used appropriately in the recruiting process. A successful recruitment project hinges on the interviewer’s comprehensive understanding of the role and organization, as well as their insight into the attributes that contribute to individual success within the company culture. Assessing a candidate’s fit is important for predicting their potential success.
The effort required to add leaders to your private organization successfully begins with a clear understanding of the role and its requirements. It continues when you evaluate several qualified, interested candidates against these criteria, recognizing why they have previously been successful.
Cornerstone International Group has been “focusing on fit” for 35 years as we help clients recruit candidates who contribute to their long-term success. We identify key leadership traits and assess candidates accordingly. We deliver our services in most business centers around the globe through a network of locally owned partners who are experts in their geography. Clients rely on our local expertise and global reach.
Leave a Reply