Management is regularly cited as the single greatest driver of underperformance, so how are we getting better at finding it? Buffett once famously said “Buy into a business that’s doing so well an idiot could run it, because sooner or later, one will”. Talk to most private equity investors about the reasons for investments not going to plan and inadequate management will be high up on the list. But instead of blaming management for underperformance, shareholders and board members need to look in the mirror: the world has changed beyond recognition in the last century, but how many investors and boards have innovated with how they go about finding the right leadership talent?
Baseball offers an illuminating path to how we might bring more scientific rigour to identifying talent. Michael Lewis’ Moneyball charts the success of Oakland manager Billy Beane’s innovative analytical approach to assembling a competitive baseball team on a tight budget. The central premise is that the collective wisdom of baseball insiders (players, managers, scouts etc.) over the past century is often flawed by “voodoo hiring” methods. Rigorous statistical analysis identified better indicators of success, and Beane became convinced that these qualities were undervalued relative to more historically valued traits. He found hidden sources of talent in pools less commonly considered by the larger teams and this approach took his team to unchartered heights. How many investors and boards can credibly claim they have looked for talent outside the obvious talent pools and applied such rigorous analysis to their management and board hiring processes?
Nurole provides headhunting technology for a digital age. I left my role as a partner in a private equity fund to join Nurole because I was convinced by the extraordinary and unique value of what it offers: the traditional search process is no longer fit for purpose. In a global world where technology is accelerating the pace of change, it is impossible for any single person or firm to keep up with everything or everyone out there. Nurole uses technology and data analytics to help organisations improve their search process; it flips the search process on its head, crowd-sourcing insight in real time. Our members are the best in their fields globally - Fortune 500, FTSE, CAC, DAX and Private Equity Chairs, Non-Executive Directors, CEOs, CFOs, Chief Digital Officers, HR Directors and other leading lights in public and private companies as well as government and not for profit organisations around the world. Nobody can see who they are. They are there by invitation or recommendation only - it costs them nothing. Our search partners are the best and most innovative in their fields - whether it’s organisations with an in-house recruiting team, leading executive search firms or independents with backgrounds at the likes of Egon Zehnder, Russell Reynolds or Spencer Stuart. Nurole is a technology platform that brings these parties together efficiently, using technology to bring science to the serendipity of search. If your search firm is not working with us, you should ask if they still drive a horse and cart to work.