By Colleen Watford, Director, Executive Search, Gibson Consultants
September 2022 – There’s nothing like an industry in upheaval to create opportunities for entrepreneurs and investors. Upheaval doesn’t adequately describe healthcare today. As we read every day in the trade press, many healthcare companies, including startups, are doing quite well. Some even have the enviable challenge of managing hyper-growth.
Yet, as any venture capitalist will tell you, success is generally elusive, and most companies either fail outright or fail to achieve their potential.
For any healthcare startup to succeed, everything must go right at the same time, and in an ongoing, sustainable way: technology, product, target segment, market timing, funding, and so on.
Yet, even with the right combination of these things, the single most critical ingredient is people, specifically the leadership team. This knowledge leads many investors and senior executives to favor the “low hanging fruit” approach to filling key executive roles.
The temptation to rely heavily on personal networks, recycling executives from past experience, is natural and understandably appealing. It addresses some important selection criteria for a potential hire:
- Trust – if you can trust the executive, you’ve satisfied one of the first and most important non-negotiable requirements.
- Less perceived risk – when you know from prior experience the executive’s talents, integrity, and work ethic, you can more easily imagine her performing in the role.
- Comfort – who wouldn’t rather choose someone he knows over a stranger, especially for an important position?
- Expedience – assuming the executive is ready when you need him, there’s no delay, as there would be if you conducted a search.
These executives are often good choices for the job at hand. You‘ve seen them perform, be tested, interact with you, and succeed. They’ve done it before; you expect them to do it again. Slot one of them into this next assignment and everyone should win.
But sometimes it doesn’t work out as well as last time, to everyone’s surprise and disappointment. As that realization sets in, so does the desire to figure out what went wrong. One might hear explanations such as, “We were ahead of the market,” or “We underestimated our sector’s ability to make buying decisions,” or “The big boys beat us down on price to the point where the business became untenable,” etc. We’ve all heard these postmortems. We’ve rarely heard, “We had the wrong guy in the job.”
My proposition is this (here comes the self-serving part): before filling such a critical role, why not satisfy yourself that this is indeed the best available person for the job? Anyone who’s been in the industry for some time usually has a robust network. But these networks have limitations.
If the position is vital to the success of the organization, invest some time and money to conduct a thorough nationwide search for the best talent. A search will give you the chance to view your favored candidate alongside others that you may not have known. As importantly, hiring a search firm will bring an unbiased, objective perspective to the evaluation. And let’s face it, if an executive delivered a big win in the past, you may be less than completely objective.
Just because an executive performed well in the past doesn’t mean she will replicate that now, when many of the variables are different. This kind of dispassionate evaluation takes an open mind, and it may challenge some of your assumptions. You may find yourself thinking, “Wow, I thought Joe was great but, after seeing these others, I’d now rank him third for this particular role.”
Or the process may validate your assumption that you had the right person all along. Either way, what have you gained? You’ve satisfied yourself and your team that you’re selecting the absolute best, most appropriate person for the job, whether it’s your favorite pick or someone that’s emerged from the search.
Our experience has shown that, when hiring teams commission a search, they sometimes end up with their initial pick, but not always. They do, however, always gain the confidence and peace of mind that comes with a thorough, objective evaluation…especially when they can’t afford to get it wrong.
About the Author
Colleen Watford is a Director of Executive Search for Gibson Consultants, specializing in Digital Health C-suite level recruiting. Target positions include Chief Revenue Officer, Chief Product Officer, Chief Marketing Officer, Chief Technology Officer, Chief Clinical Officer, Chief Operations Officer, Chief Financial Officer, and other C-Level roles.
Colleen works with entrepreneurs and investors in digital health to secure top leadership talent and help their companies scale. Her goal is to make the hiring process easy and the hiring decision difficult for her clients.
Spot on Colleen. In addition to Trust, I’d add Integrity to go hand in hand.