Wednesday, December 04, 2013

Building A Billion-Dollar Enterprise, 24: HR 101

A few days ago, I posted the following on Facebook...

HYPOTHESIS: In building an enterprise, the most important skillset is that which enables attracting and keeping talent.

The important thing about building a billion-dollar enterprise - or building any enterprise- is not that I possess all the expertise needed to make the thing go. It's that someone in the enterprise has all the expertise needed to make the thing go.

I have persistently made the error of trying to cultivate expertise within myself rather than learning to attract and retain others who possess expertise.

What's really weird about that, is that I have known better for some time now. It has been at least a couple of years since I began sharing with others an acronym that I said I would make the basis of everything I do: RISC. Which stands for:

The idea being that, in putting together any kind of project, process or entity, I will always begin with relationships. Then comes acquiring and packaging information. Then, using those relationships and that information to attract people with the necessary skills. Then, and only then, seeking the capital for the whole package. (I considered it important, and still do, that money comes last. Further, I convinced myself that when the other things are in place, the money will come relatively easily. That notion may deserve a separate post.)

So, I know that I need to get good at attracting and retaining talent. Now I need to think through how to make that happen. I could just ask, "How do I attract people who have the skills needed to attract people?" Hmmm.....

However I go about it, I need to include filters that prevent the acquisition of bad talent - i.e., people with skills who would ultimately be poor employees. Like Larry Summers.

When Larry Summers was still under consideration to become the next chairman of the Federal Reserve Bank, James Kwak wrote a piece at the "The Baseline Scenario" blog titled "Toxic Trait To Avoid #1."

In it, he quoted Felix Salmon:

"Summers is, to put it mildly, not good at charming those he considers to be his inferiors, but he's surprisingly excellent cultivating people with real power."

...then added, "this is absolutely the worst personality trait you can find in anyone you are thinking of hiring."

As Luminaria Productions grows, I want to create a culture which, first of all, would not be attractive to a person who lacks empathy. And I want to establish hiring processes that would weed out such people even if they did come forth as candidates.

A simple test might be to meet someone for lunch and observe how they treat the waitstaff.

Alternatively, I/we could ask for references (or better yet, inquire without asking), not from someone's manager, but from someone they managed.

Meanwhile, "Snakes in Suits" is still on my to-read list...

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