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Archive for March 6, 2012

5 mistakes growing companies make when hiring a CTO (the results could be fatal)

The examples of hiring the right person for the job – outside of the software business – are everywhere.

– Passengers on a Boeing 737-800 know that the pilot in command has been properly trained to fly this aircraft
– Passengers on an Airbus A320 know the same
– The country or state where you reside asked you to pass a driver license exam in order to drive

Yet growing technology companies make mistakes – often fatal mistakes – when hiring a CTO, in this case someone who will play a leading, critical role in formulating a technology strategy (with a plan to deliver of course) in growing the business.

Mistake 1:  Failure to ask the right questions and assess how you – as a company – arrived at the present moment in time

“There is a reason why today is meaningless and meaningful at the same time.  Meaningless – because today is simply an outcome of everything we have done yesterday.   Meaningful – because everything we do today will influence tomorrow.”

– Are you a company that has evolved via acquisitions or organic growth?   How would you rate yourself against the industry and closest competitors?
– Who is your competition?  How well do you know your competitors and their technology leadership team?    Will your new CTO be as capable as their CTOs?
– What is your growth strategy?  Is there an organizational strategy to support the growth strategy?
– What is the true state of the product?  Zero technical debt or lots of technical debt?
– Is there tension between members of the executive team?   There is always some healthy tension.  But – is there a fundamental misalignment between the strategic agenda and the ability to execute?  Would the new CTO simply add to the tension and – despite their best efforts – fail early?

Mistake 2:  Failure to create a clinical competency matrix which clearly defines who we want as the new CTO

Yes – the competency matrix has to be clinical (or “binary clear”).

Imagine the following scenario.   The new CTO joins the company and quickly notices that the sales team is actually very average.   What’s the point of building a fantastic product if the sales team cannot sell it?   Removing the constraints of organizational boundaries, what is the right thing to do?   Will the new CTO have the organizational courage and maturity to engage and help the sales team sell?  And if this approach does not work, approach the CEO and explain the problem?

That’s why Mistake 1 above is the one that almost always leads to a fatal outcome.   Growing companies that do not know themselves – or fail to learn about themselves – have very little chance of successfully hiring the right CTO.   Unless the company knows itself, it cannot create the very matrix which will define the right CTO against which the candidates will be compared during the search efforts.

Mistake 3:   Failure to hire the right candidate vs seeking “safe” candidate

“Safe” candidates are very attractive:  do not have to relocate anyone, may be coming from the competitor (but are they capable of quantum innovation or simply able to avoid mistakes that the competitive circles already know).

The right candidate are much more difficult to identify unless the competency matrix is “binary clear”.   Once identified however, open all doors to get this person onboard.

Mistake 4:   Failure to accommodate the friction which is always associated with progress

The right candidate will cause friction.  It’s inevitable.  Progress is impossible with friction.

Does the executive team understand the strategic direction and how the newly hired CTO will help achieve the desired business outcome?  Change will be inevitable and with progress friction will arrive.   Is everyone truly ready for change and some healthy incremental friction?

Mistake 5:   Failure to support the newly hired CTO

Newly hired CTOs fail for many reasons.   One of the major reasons is failure to understand and engage their team.  I always suggest that any new CTO should spend the first 30-45 days in the trenches to understand everyone’s challenges and needs.  Only then the new CTO will have enough organizational capital to  describe the mission and inspire everyone to follow.   The second major reason why a new CTO fails is lack of support from the executive team that invested an incredible amount of time (and sometimes money) to find the right person and not the “safest” candidate for the job.  As an agent of change and progress, the new CTO will be a messenger of disappointing news in the beginning.   One of their early goals is to understand what works and does not work before suggesting a specific course of action.   Do not shoot the messenger.   If the new CTO fails, you will fail with him or her.