While in Shanghai a few weeks back, I was talking to one group of founders about the importance of recruiting. They mentioned two things: First, they take personal accountability for all senior recruiting. Second, they ask each senior recruit for a “rapport d’étonnement” after 100 days. By the time this phrase made its way from French to Chinese to English, it was described to me as a “shock report,” which I found a bit perplexing. But with further clarification, I understood the concept and loved it.

The founders’ first point was that recruiting senior talent was their No.1 job. They had made some disastrous mistakes in recruiting a few years earlier and concluded that they had delegated too much of the task to their human resources director and headhunters. In seizing back control, they argued that they were the only ones who could really determine “fit”―that vague but critical set of characteristics that suggest a new recruit will work well with the team, while understanding, nurturing and building upon the firm’s culture.

Their second point, regarding “rapport d’étonnement,” took a little more explaining. The actual translation of the phrase, I’ve learned, is “astonishment report.” My French colleagues say it is a tool used by businesses, government and academia to tap the insights of new recruits or students by asking what most astonished them after joining the company or institution. The goal is to capture the collective wisdom of first impressions before the organization’s culture begins to shape the way new recruits see things.

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About the Founder's Mentality

The three elements of the Founder's Mentality help companies sustain performance while avoiding the inevitable crises of growth.

The founders said they were using rapports d’étonnement religiously with new senior recruits. When I asked what their biggest insight was so far, I was told, “Recruits talk about generations in our company. They notice two trends going on. The first is that the further you get from the founding team, the less the employees feel like it is their company, their mission. The second is that the younger our employees, the higher their expectations are from their job. This has led us to rethink equity distribution and try to get more equity to all levels.”

This conversation in Shanghai reminded me of a quote by Richard Fairbank, the CEO of Capital One Financial: “At most companies, people spend 2% of their time recruiting and 75% managing their recruiting mistakes.” (Fairbank was cited separately in two very good articles in Forbes and Harvard Business Review on the need for CEOs to take accountability for recruiting.) In the context of how companies can “professionalize” their organizations without sacrificing their Founder’s Mentality℠, recruiting is an essential capability to get right. As part of our FM100 Forum, we are beginning to put together a list of recruiting best practices among members. While still a work in progress, here are five:

1. The senior team must own it. Since revenue tends to grow faster than talent, recruiting has to be job one for the senior team. To sustain growth, senior leaders need to fill critical talent gaps, and one of these gaps is probably a chief human resources officer (CHRO). Start there. As growing companies mature they need more than an HR director. They require a world-class professional who can join the senior team, assess what jobs need to be done and either identify or recruit talent to match. By no means does this take the founder out of the recruiting equation. Rather, the founder and the CHRO work together to gauge the company’s organizational readiness for change and tackle the big issues that get in the way of business transformation.
2. Be clear on the “unit of experience” you require. As we noted in the blog post "The Talent Table," it is crucial to match needs with specific competencies and experience. The most common mistake is to recruit an executive used to administering large-company systems and processes, when you need someone who can build new systems tailored to support the growing company’s “kings.” Or you recruit a head of sales experienced at managing through regional “span breakers”―layers of people between the senior team and the front line―instead of one capable of recruiting and building a lean, responsive sales team. Ben Horowitz, cofounder of venture capital firm Andreessen Horowitz, had an interesting take on this: “[t]he bigger the company and more complicated the job is, the more you need knowledge and skill. When hiring for skill, you need to know what you need this person to be world-class at, because it’s not everything. Nobody’s world-class at everything.”
3. Recruit for fit, but don’t recruit clones of the original team. As our Shanghai founders said, fit is critical. New recruits need to mesh with your culture, and they also need to understand the company’s Founder’s Mentality (insurgency outlook, owner mind-set, obsession with the front line). But it is also essential that they bring their own strengths to the game. Our FM100 members have pointed to a whole set of characteristics to look for. They recruit doers (not just thinkers); they seek out those who love the product and buy into the mission; they look for an instinct to get out of the office and into the field; they search for those with an appreciation of the right conflict and a hatred of energy vampires.
4. Recruit the person not the job description. While recruiting the right unit of experience is important, that doesn’t mean you should ignore a top prospect if one becomes available. Top talent will adjust; lesser talent won’t. Don’t bias these searches to prospects that fit the job description perfectly over players that might need time to learn the new role. When the founders of Yonghui Superstores went looking for a new president to run operations, for instance, they chose Jianbo Li, a veteran of IBM and Procter & Gamble, even though he had no “fresh food” experience. His big-company pedigree wasn’t the deciding factor―in fact, as we described in a previous post, big-company recruits aren’t always a fit for founder cultures, despite their professional skills.But Li’s capabilities mapped to the company’s mission and its need for more mature systems and processes, and he demonstrated a clear appreciation for its Founder’s Mentality. “We must understand and respect the founding period, but we also have to build new capabilities to take the company to the next level,” Li says.
5. Own the integration and take personal accountability for the recruit’s success. As we’ve discussed in these blog posts, it is the founder’s job to take accountability for integration and training of important new professionals. He or she must also create a narrative that convinces the organization that new recruits are now central to taking the company to the next level. Founders must look for the “golden threads” that weave together the stories of the original founders and those of the new professionals. Together these stories present the most compelling vision of the company’s future.

This list is still coming together. But it lays out the crucial elements of recruiting professionals who can add essential capabilities without diluting the Founder’s Mentality. We’ll now add in “shock reports” and the value of capturing the collective wisdom of first impressions.