Chapter 8
Step Eight: Assessing, Recruiting, and Empowering the Broader Team
You have long since assembled and unified your leadership team. As discussed back in Chapter 2, you must accomplish this early in the breakthrough change process since your vision and plan for change will be far better if you have people with different perspectives, more skills, and a broad range of experiences at the table to challenge your ideas and offer additional ones. Typically, the early team needs to grow over time, both with new members for the leadership team itself and with new colleagues who may be one or more layers removed in the organization.
This chapter builds on the work you did in Step Two. At this point, you might want to revisit and repeat some of those initial team-building actions, for at least two reasons. First, it may be time to further strengthen the leadership team for the long haul. And second, as the focus shifts to bringing together the entire team, you need to attend to the broader team that will ultimately do all the heavy lifting to bring the change initiative to fruition. This means assessing skills, namely, skills that already exist within the organization, additional skills you will need to develop, and skills you will need to bring in. It also means recruiting for talent, fit, and balance, and empowering the larger team to succeed.
Assess Today for Future Needs
This step also relies in part on the work you did in Step Five, as you began developing a long-range workable plan for your breakthrough change. Now it's time to update those assessments with an eye toward gathering and developing the broader team. Assembling a team with the skills that are known to be necessary and the flexibility and interest to grow into the unknown is a complex and demanding task. Like many other parts of the Stacking the Deck process, it's iterative; that is, you will need to return to it from time to time. And it is often more difficult in practice than we can accurately anticipate. Almost by definition, something as new as a breakthrough requires new skills—and often skills that haven't yet been broadly developed or even precisely defined.
Imagine the Dream Team—and Dream Big
Even when you can't yet know all the specifics, you can start by dreaming big as you imagine your dream team. What would it take to make this breakthrough change happen within the time frame you've set and at the level you want? Given the scope of your breakthrough change and the talent you will need in your dream team, you will likely need to cast a broad net and look in ways and places that will bring your group diversity and strength in skills, experience, and track records. And if your change needs to happen quickly, your search needs to bring in top-notch people with the necessary skills right away.
Start with Diversity
When we think of the benefits of diversity, we often fall into the trap of defining diversity narrowly and focusing on its racial, gender, or ethnic dimensions. Recognizing that diversity strengthens a team's performance, we need to go even further and strive for diversity from every angle, especially including the less visible elements of attitude, experience, focus, perspective, and work style, as a few examples.
Keep diversity in mind for your dream team and for every iteration of the team. A team without diversity or a team that stays constant can get too comfortable. People can become so bonded with each other that they are unwilling to challenge one another meaningfully. Or even more destructively, groupthink sets in and suddenly the team doesn't have anyone with a divergent opinion—or anyone willing to voice one. Adding new people from new sources, inside or outside the organization, is a great way of keeping a team on its toes. Injecting new blood every few promotion cycles adds a new layer of challenge and opportunity. Since a constant influx of new members may mean the team will not gel in the way that more stable teams do, it's particularly important to monitor the team as it changes.
Schwab was changing so rapidly during my years there that I was constantly looking for new executives who could expand our team's experience, perspective, and skill. I consciously tried to maintain a promotion/recruitment ratio of 2 inside to 1 outside. If I was promoting someone from inside the company, I wanted it to be because they were able to contribute something special—the accumulated benefits of their experience and familiarity with the company. If I was recruiting someone from outside, it was because we were making a leap into something beyond our cumulative experience and we needed someone with the relevant background to help us through the change. The goal was to maintain a dynamic, multitalented group of people at the highest levels of the company. A team might include people who had been with Schwab for 15 years and others who had been there for 15 weeks, all working together successfully.
Integrating new people into a working team does present challenges, which you should not underestimate. You must constantly balance many variables. Do you have a team full of extroverts? Introverts? Leaders? Followers? Quick deciders, or more-reflective types? Just as you want to pull together a group of people who can work together productively, you also want to pull together a set of disparate experiences and skill sets that will mesh usefully.
Check Track Records
Common sense might suggest that you look exclusively for people with glowing track records, but that isn't always the best impulse. Ski instructors often tell beginners, If you're not falling, you're not learning. For the more advanced skier, If you're not experimenting with the edges, if you're not skiing on different types of slopes, you're not learning and practicing new skills. This doesn't mean that the most snow-covered student will ultimately become the best skier. But the comparison to skiing is useful as an analogy to remind us that unless we're willing to experiment and push toward the new, we won't continue to improve and reach the next level of challenge.
If a successful track record may thus have its downside, then in turn the person who has been involved with a failed project may well have gained priceless insight. In fact, one of the great upsides to a well-intentioned failure is the invaluable experience that people gain by having tried and failed. (The concept of Noble Failure is discussed more thoroughly in Chapter 10.) If your goal is to never make the same mistake twice, it makes sense to broaden your database of mistakes and the learning that comes with those experiences as much as possible. By hiring someone from another organization who was integral to a project that failed there, you can acquire the lessons learned but without all the costs. Indeed, second only to a person's wealth of specific expertise, which you need, the next best reason to recruit from external sources is to learn from the mistakes people have made elsewhere.
Once you have imagined your dream team, you know what skills you need. And you know what kind of person you are looking for: an experienced innovator with a fresh perspective, who may have failed somewhere but who learned from that experience, and who is capable and excited about embracing change. The questions are then how you find the people you need and how you get them to join your team.
Search for Talent, Skills, and Fit
You know that you're looking for people with precise skills, talent, and experience for your dream team. Now, where will you find those people? Given the nature of business, you may at first be limited to the people you already have available to you, those inside the organization. But what if there aren't enough people inside with the right skills? Or worse, there aren't any available? In a breakthrough change initiative, the chances are you will need to at least supplement the talent you have at hand and do so quickly.
Inside Your Organization
You will first want to look inside the organization to use the skills of the people you already know and trust, people who deeply understand the organization's mission and the importance of the breakthrough change. Being able to rely on people who are already part of the culture can be a tremendous boost.
This worked to our advantage at Schwab, time and again. In the early 1990s, when Schwab had decided to get into the mutual funds business in an entirely new way, we gave the assignment to Tom Seip, a devoted change junkie. Tom led an incredibly challenging effort to bring outside fund companies into the Schwab tent, and he succeeded. We moved Beth Sawi, former head of Schwab marketing, into the leadership role on our electronic brokerage business—and she transformed it into an industry-leading business. In moving the very capable John Coghlan from a job that poorly fit his skills and interests, we gave him the opportunity to blossom as he launched and then ran our Financial Advisor servicing business.
In each instance, we knew we had smart, capable executives who loved challenges. We knew they could recruit and lead exceptional teams and we gave them huge opportunities, which ultimately led to long-term competitive advantage for Schwab. They took the steep challenges, surrounded themselves with exceptional teams that blended inside talent with a smattering of outside talent, and they excelled. They have all moved on to new challenges and careers, but their contributions and legacies at Schwab continue to this day.
Insider Challenges
Unfortunately, as leaders quickly realize, the reality they face within the organization is often quite different from these ideal examples. John Donahoe at eBay and I spoke about just this issue. As discussed in Chapter 1, he too faced the challenge of needing a new skill set from a group of people who were wedded to the old ways of doing things. To be sure, difficulties do arise, but not just because of people's tendency to hold on to the past way of doing things. It's more than that. As John said, “It's also about a longing for the past. If people were part of something successful before, they naturally want to cling to that. They were winners once and they want to be winners again. But there's no guarantee that they have the commitment and tenacity that's going to be required to get to the new place. Or even that the new place will be as good as what they remember.”
But there is no going back to the way it used to be. For those who have a tendency to look backward instead of forward, that idea is particularly difficult and all change is a challenge. John continued, emphasizing that some people are always measuring against history “rather than against the competitive environment, the customer needs, and all the other indicators we need to watch to succeed in the future. This comparison with the past is deadly because it's internally focused. It's too easy to fool yourself this way. Whether it's your golf swing, your marriage, or your business, if you're measuring exclusively against yourself, you get a distorted, less objective sense of how good you really are.”
John nails it there. As they say in the financial industry, past success is not an indication of future performance. And in today's climate, the sentiment is true across all businesses and around the globe. In fact, a major success in someone's past can actually hobble that person when it comes to looking at change on the horizon. “Think of it,” John said. “As some people grow their careers, they tend to become less and less comfortable with bold change. To them, bold change is how you build your reputation, not how you protect it.” John talked more about how people become increasingly protective of their professional identities. “It's not even about how good or bad these people are at their jobs. A lot of the issue is context. The people who just couldn't get on board with some changes I had proposed moved on.” He related that some of those people went to places where they hadn't been part of a past success and found they could embrace and even lead bold change. Perhaps that was because “they didn't have history there, and change or the avoidance of change wasn't all tangled up with their personal identity. Sometimes a move into a new scenario where people have to prove themselves again can shake them out of complacency and fear.” We both understood that no one chooses to be ineffective. Many times a change of scenery can be the impetus that ultimately enables someone to be successful again.
Skill Gaps
All too often, when you embark on a breakthrough change initiative, you will discover that you don't have all the expertise you require right there at your fingertips. After all, it's only natural that employees focus their time and effort on becoming better at the processes and tasks the company has historically and habitually used. The very nature of breakthrough change upsets the comfortable order of the company and demands something new and daring.
If you've come to realize that even your best people are not right for the job, how do you go about finding the right people? This can be a long process, but one that you can shorten considerably by making a habit of looking out for talent and actively developing yourself as a talent magnet. If you have been consciously cultivating talented people both inside and outside of the organization, you already have a head start.
Becoming a Magnet for Talent
Ideally you want to be able to draw on an ever-expanding pool of talented people, both inside and outside your organization. If you want to engage the best of the best, you have to be extraordinarily compelling—not just in the compensation package you offer but in the personal experience you are inviting people to share. Part of this is simply being a good leader, someone people want to follow from project to project, someone who challenges people and draws out their best. If you are committed to being a leader of breakthrough change, the odds are good that you are going to have to assemble many teams over the course of your career. This makes it all the more important to create and cement connections with creative, talented, driven people, wherever they are. It requires being proactive and personal about building and maintaining your contact list, one step in the process of identifying people with skills or attitudes you may want on your team in the future.
Whether building a network comes easily to you or is a skill you need to work on, the sooner you start, the better. Consider the people you meet at a conference, people who have worked with you before, even people who have recently been part of high-profile change projects elsewhere. Keep tabs on these individuals and cultivate professional relationships with them. Stay in touch and take a personal interest, perhaps even offer to act as a mentor. The odds are good that you will both benefit. And someday you may need their unique talents on your team.
Drawing a Team to You
Intel has long been the leader in the personal computer and data center server markets. However, their products had not been engineered for the fast-growing mobile markets of smartphones and tablets. These markets need lower-priced, lower-power technology, shorter development cycles, and experience as a scrappy, nimble competitor. Those of us on the Intel board and the leadership team understood that these distinctions changed everything about the skills and experience we would need as the company was developing new products; and they changed where we would need to look to find the right people.
When Mike Bell first joined Intel, he faced not only organizational tradition but pressure to recruit a team exclusively from within the Intel structure. Mike wisely ignored these suggestions, pointing out that Intel people may have had extraordinary skills and experience with PCs but did not know the mobile business. When Mike and I spoke about assembling a team and getting the right array of skills, he wholly agreed with the idea that context is critical for getting the best performance out of a team and he understood that “if you take great people and put them in the wrong roles, it's destructive. It hurts the effort and it really demoralizes and demotivates these people, who may have been superstars at what they did before. If you shove them into a place that they aren't suited for, it only does damage.”
Instead Mike was careful and especially mindful about the people he brought together. In developing the mobile space at Intel, he searched for internal people who were not bound to the traditions and who were ready for new attitudes and skills. Well known as a magnet for talent, he ultimately found, in looking both inside and outside the company, “a mix of highly motivated, very smart people who had some relevant background, who had the right attitude, and who were willing to learn.” As he said, “This mix of inside knowledge and outside knowledge is very powerful—and it needs to be properly balanced to be effective.”
The insider-outsider dichotomy and potential synergy to which Mike alluded is only part of the story. When you are choosing your team members, you have to consider their personal history. People frequently get very comfortable after what might be years of success, and the successful track record that makes individuals desirable as team members can also make them too conservative and too concerned with protecting their legacies. As if that weren't enough, new people who are coming in from the outside will potentially be seen as “Mike's friends” and may be culturally rejected by the long-term base of the team. Creating a team of both insiders and outsiders has its own challenges for which a leader needs to be prepared. The benefits are certainly worth the challenge, but you shouldn't underestimate the time and effort this kind of team building requires.
Leaders who have a following are talent magnets—as Mike Bell clearly is—and the pieces seem to fall into place more easily as the team develops. As Mike said, “One of the key things I've learned over the years is that engineering is a team sport. In fact, some of the best things I've done in my career have been with a group of people I've worked with over the years, people whom I know and I can trust.” When we spoke, Mike was in the process of assembling a team for a new project. He explained that “some people I know who are working for others have been calling me up and are asking to come on board. It's gratifying to see these people who have worked for me for years and they still want to come along and do something else.”
A strong, solid team allows the whole project to move faster and perform better. It can make all the difference. But no matter what the team's makeup, we both understood that after teams have formed, they need tending and nurturing. Leaders “can't put a structure in place and then let it go,” Mike said. Instead you need to constantly check in to be sure you have the right people, the right expertise, and that everyone's performing. This is particularly important when you're trying to move quickly. Being a personal magnet for talent is enormously helpful, then, both for the speed with which you can put together a team and for the ongoing quality and performance of that team.
You want to be someone who enables people to be their very best. That skill and ability to draw people to you reflects well on you and by the same token is something to look for in those you hire. Mike underscored this thought. “When I hire someone and then ask that person to build a team, if the response is something like, ‘Oh, I wouldn't know who to hire,’ I begin to get a little nervous. If a person doesn't have at least a small group of people to call and potentially bring over, that's a warning sign. Having a following is especially important these days.” But what if you've already tapped all the likely candidates you know?
Recruiting Outside Your Network
Anyone who is looking forward to a long career as a leader should be establishing long-term connections, preparing for the future, and becoming a personal magnet for talent. But what if you find yourself in need of people who aren't yet in your network?
Mike offers some suggestions for finding and recruiting people: “After I exhaust my network of people, I rely on a couple of trusted recruiters who share my vision of how products should work and how people should work and we share a work-hard, play-hard philosophy. They know the quality of people I expect—and they are able to get these people interested and engaged enough to come talk to me. Then, I meet with these people face to face and see if they are a good fit for the team. Having that next level of network to find people is critical—and these recruiters have delivered time and time again.” Naturally, you may have to try a few recruiters before finding one that works for you. When you do, Mike's advice is to nurture that relationship carefully, for doing so will save you time in the long run.
All of your efforts should work in concert to help build a highly capable team with the skill sets that you need. Over time, as you build your own reputation as a change leader, you become a more and more desirable boss. That, in turn, allows you to reach out even further and build more connections. Perhaps some of these people then come to work with you. If they have a positive experience and your work together is successful, then you've cemented your relationship, added depth to your experience, and bolstered your reputation. Ideally, your network of contacts and your reputation as a talent magnet then both expand still further.
Unify and Empower the Larger Team
No matter how strong you believe you are as a personal magnet or how good your recruiters are, don't underestimate the challenges of forging a cohesive team of insiders and outsiders, a team that is diverse and talented in a broad range of business aspects. Time and effort will be needed, both to create the team and to bring it together. The benefits of a strong team are worth it. And with the right team, creativity in the face of a crisis can work wonders.
Ginger Graham has run several businesses that focus on innovation and new product development and speed. She explained that at one point the medical device company she was then with, Advanced Cardiovascular Systems, was “woefully behind in stenting technology and losing market share in the core business because of it. So we formed what at that time was a quite novel, heavyweight team. We invited something close to 50 employees into a room for several days with a professional facilitator to map out how we had been developing products. Then we asked them to brainstorm and work together to answer the question, ‘If you could change it all, if you could fix all the things that you believe the company has been doing wrong, what would that future development process look like?’” The group immediately set to work and redefined product development in the company. They defined a new way of developing products that would be “faster, leaner, more efficient, more focused—and that would allow us to catch up and win in the marketplace. We gave the team the resources they requested and wrote a contract with them about their deliverables with respect to product performance, product quality, time, and cost, and customer satisfaction and market performance on the results, based on them being able to drive product development as they believed it should be.”
Bold moves brought breakthrough results, and as Ginger explained, “The employees did know more about how the work should be done and can be done, much more than those who managed it from afar.” In fact, the process worked so well that the company “went from 1 percent to more than 75 percent market share on one product launch in a major category in stenting, when stents were still relatively new in this country.”
Later, when that very success created its own problems, they went back to the employees for answers. Having launched a new variety of stent for use in heart surgeries in October, Ginger recounted that “before Thanksgiving, we faced product shortages. It's almost inconceivable that you could launch the market-leading product and be out of stock in such a short time frame. We did a global launch and we, as management, did all the calculations and all the number crunching.”
Ginger described the questions they had to ask themselves: “Could we make enough to keep up since it's growing so fast? All of our numbers said no.” So they had an all-employee meeting in each of the company's locations, during which “we showed them the response. We talked to them about what had happened with the launch, how the market had grown, and how many people needed our product.” Ginger and her team brought patients and doctors in to talk about the product. They then asked the employees: “Is there a way that they could help us solve this? Is there any way we could produce more, faster?
“These employees told us, ‘You need to help us with our Christmas shopping, you need to wrap our presents, we need babysitters, we need transportation. And we'll make it happen.’ And they did.
“We held up our side of the bargain. We set up a giant wrapping station in the business and we wrapped everything imaginable. We even wrapped a surfboard.” Her stories of management volunteering to make life easier for these employees cover a wide range, from providing three meals a day to transportation for employees and for their children's babysitters. “As management, we had been sure that everyone would have to work both Thanksgiving and Christmas and worried that even so, we wouldn't make the numbers.” Instead the company never ran out of product and no one had to work Thanksgiving or Christmas. “We put the future of this product in the employees' hands and they didn't let us down. It was an incredible personal experience for me and solidified my very strong views about how much employees drive the success of your business, not management.”
Ginger's success stories of her empowered teams illustrate how much can be accomplished with the right teams and the right attitudes in place. It's a theme the leaders I interviewed returned to time and again. As Citi's Debby Hopkins said, “When you are leading a change, you must have a very acute sense of the team that you want around you. You are fighting insurmountable odds on so many fronts; understanding the types of people that you want to bring on board is a critical element. The team needs a sense of where we're going and a passionate belief to shore up that vision.”
Passion is so important that, as Debby said, sometimes “it's tempting to think that passion is always the answer. But we also need people who are going to question that vision. If they're good questions—and if you as the leader have good answers—this will solidify your project.” She refers to this aspect as “helping people ‘step into why.’ Why do we think this is a good opportunity? How do we get there? What are the components? These questions build a bridge that people can follow, a bridge that enables them to see across to the other side. So passion is great, but sometimes you also need some skepticism, that different perspective.”
It may seem odd to think that skepticism can be helpful. But constructive skepticism can keep you from very enthusiastically driving over a cliff. And that same skepticism is invaluable as you keep the team fresh and thriving.
Rebalance and Revamp the Team
As with virtually every other Stacking the Deck step, assessing the available skills is not a one-time thing. You must constantly reexamine this careful balance between insiders and outsiders, between the old guard and new blood, between known and unknown quantities. To keep your team functioning, you must remain alert to what skills you and your team may lack and how well people are working together with the structure that's in place.
Sometimes even when you think your team is all set you will be surprised. In our early years at HighTower—a relatively new wealth management firm where I serve as chairman of the board—we thought we had assembled exactly the team we needed to go forward. The strength and experience of this team were critical to our ability to raise capital. However, as we got off the ground, we learned that several of our key hires didn't fit the culture and pace of an early-stage firm, although they had been quite successful previously in a more mature company. This mix was not something we could afford, as we really didn't have depth and backups for these roles. We had to face the reality, quickly make a change, and figure out how to fill the gap until the right new hires could be found. Waiting to see if things were going to get better, which was our first inclination, would just delay the action that we desperately needed to take. We handled the situation with the urgency it deserved and eventually found the replacements to take the company forward. While it was pure hell for a while, the right new employees accelerated our progress and have become a huge part of our growing success.
Discussing a recent Intel project, Mike Bell mentioned that he found out six months into it that “some of the people I had thought could step up and do the job were only comfortable doing business the way they always had done it. They just weren't the appropriate people for the project and I had to go back in and make further changes.” He realized that “you really have to constantly have a feedback loop that says: ‘Yes, this is the right thing to do and these are the right people and everybody's still performing.’ You have to keep evaluating it, to make adjustments along the way.”
The balance between being provided with sufficient feedback to give the leadership team the information they need and offering the people on the ground enough leeway to be creative and fully involved can be a delicate one. In speaking of a team that was putting together a major new project as we spoke, JetBlue's Dave Barger explained that “the team leading our project put together explicit rules of engagement that made very clear where they had authority and where their authority stopped, in terms of capital and otherwise. Whether it concerned design of the product or changes that could be incorporated after a decision had been made, these rules of engagement were very clear about who had what authority.”
Dave has a weekly meeting with his Executive Leadership Team. He remarked that “every six weeks for the past year, we've had an update from this project team. This cadence and the clear rules of engagement made a huge difference. They knew when they were free to use their own judgment and when they needed our decision—and they didn't need it much. We had gone out of our way to get these passionate high-achievers on the team, and we didn't want to micromanage their work and risk suffocating their interest and creativity.”
Because JetBlue was aiming for a differentiated project, one “that's not cookie-cutter like other airlines, but something different, something that's in keeping with the irreverence of the JetBlue brand, it meant ceding some control to the project team. We knew that we would have the opportunity to check in every six weeks; they knew that there was going to be this kind of briefing. We picked the team members to develop this project and we let them do that.”
Dave's experience highlights a challenge that every leader faces: learning how to give up control and deciding how much control to give up. Dave understood that it would be a shame and a misguided use of energy to spend so much time building a strong, bright, skilled team and then hamper them with oppressive oversight. Between the rules of engagement and regular check-in meetings together, the project team and the leadership team kept the project on track and balanced, observing suitable levels of authority where they were most needed.
In speaking of how teams are best built and fine-tuned, Starbucks' Howard Schultz mentioned that he had Tony La Russa (currently a baseball executive with the Arizona Diamondbacks and a former World Champion manager of the Oakland Athletics and the St. Louis Cardinals) talk to his management team. Howard explained that Tony, who had by then been named manager of the year four different times, “said something that day that didn't initially play well to our people. He said, ‘Not everyone deserves to be on the team.’ He gave a couple of examples of players who were selfish and not team players. And he got rid of them.”
Later, Howard talked to his team about Tony's comments at some length: “If you have people in this company who you know are not going to rise to what we need, then you have to ask them to leave because they're not going to be producing for us. Not everyone deserves to be on the Starbucks team.”
Just as companies are hardwired to do what they have always done and maintain the status quo, many people think that leadership is about reducing conflict and maintaining an even keel. But really that's what management is about. Leadership requires challenging your people, because challenge is the antithesis of complacency and is its antidote. Challenge can shake people out of complacency and move them toward a better future.
As you've no doubt gathered by now, one of the underlying themes in the Stacking the Deck process is that the work never stops. Not only do you need to keep reaching for challenges for yourself; you also need to keep demanding that your team rise to each new challenge, whether it's one you've actively planned or one that the changing world has presented to you. This may mean bringing in someone from another company, or another industry. This may mean moving people who have been working in one area for years to a different task or venue. New challenges demand constant adjustment to make sure that everyone is contributing their best to the team as a whole. This means keeping yourself and your team healthy and dynamic, ready for the inevitable surprises, roadblocks, and new challenges that pop up on the road to breakthrough change.
Now you have your plan, your analytics, and your team. It's time to implement pilot tests of your breakthrough change, as Chapter 9 describes.