Every so often we do some analytics within the firm just to level-set on where we are.  OK, in all honesty, we’re very metrics-driven so it’s probably more than “even so often,” and it’s also not a casual, anecdotal assemblage of loose stories and vignettes.

One of the topics we wanted to  give greater scrutiny was how much of our practice in the last 18 months or so was for portfolio companies of private equity firms.  And not only how much, but while we were at it, what geographies, and why not look at size of those private equity portfolio companies’ revenues, and the industries in which they clustered?

That set us off to “cypherin’” as they say.  Below are some of the results.  Given that our roots 15+ years ago were in earlier-stage, venture-backed companies, it’s an interesting diversification.  For some, this may be intuitive. For others, they may wonder about whether leadership talent for venture capital is completely different than those executives we recruit for our private equity clients.  The answer to that?  It is still apples to apples, and not apples to oranges.  Just a broader spectrum of apple varietals.   When thinking about venture capital portfolio leaders versus private equity portfolio leaders, at their core (couldn’t help the pun) they are still builder-leaders, which is the mantra for the type of talent we’ve specialized in a decade-and-a-half after founding the firm back in 1997.

While much has changed, this has remained a constant.

Stats below are based on some 40+ searches.

Enjoy.

***

Our sweet spot over the last few years has been in the growth equity segment of the private equity investing thesis.  That means more than half of all searches we’ve performed for private-equity backed clients have been for companies with revenues in the $25 million  to $250 million range.  The balance–about a third of private equity-backed company search work–was for companies with revenues about $250 million.   These were sprinkled evenly across the $250 million – $500 milllion, $500 million to $1 billion, and great-than-$1 billion slices.

When we looked at the executive levels we had executed on behalf of our private equity-backed clients, a third of searches were for CFOs, 40% were for CEOs and COOs, and the balance of our search work was at the VP level, across the functional spectrum (see next graph for more detail on the VP-level exploded pie analysis).

Search work for private equity-backed clients at the Vice President level distributed nicely over the organizational functional spectrum, including VP Sales, VP Manufacturing, VP Engineering, VP Marketing, VP Operations, VP Content (most in the education industry sector), and VP Human Resources.

Finally, we looked at what party of the country (or globe) these searches clustered within, and the above graph portrays the distribution.  Even we were surprised at this chart, as it shows an almost geographic-blind distribution–searches executed in all 7 regions in the U.S. (Northeast, MidAtlantic, Southeast, Midwest, Rocky Mountain, West & Northwest), along with an equal slice representing private equity-backed companies for whom we had done searches that were based in Europe (United Kingdom, France, and rest of West Europe).

A Leading Pioneer in reCommerce

Our client is a pioneer in what has been dubbed the re-commerce sector.  The Company fundamentally improves how people buy, use and dispose of their consumer electronics by providing a complete trade-in solution focused on value and convenience.

The Company addresses a global e-waste problem and simultaneously accelerates the extraction and monetization of a $185 billion secondary market in consumer electronics, video games and DVDs.   Over 2,200 retail locations in the United States are currently utilizing the the Company’s trade-in platform.  Gartner dubbed this industry the ITAD sector, or “Information technology Asset Disposition.”

THE POSITION

Detail of Responsibilities

The role gives an energetic and experienced business development professional in the mobile phone business an opportunity to join an industry leader in a relatively new, high growth and disruptive space and reports directly to the President & COO.

The ideal candidate will source national tier-one mobile industry players, including tier 1 wireless carriers, MVNO’s, VAR’s, OEMs and other potential partners for trade-in partnerships with the Company.  This is a strong hunter role and any account management responsibilities will be kept at a minimum using leveraged resources wherever possible.

The selected candidate will possess a combination of the following attributes:

• A minimum of 12 years’ experience in a business development role with tier one mobility companies, with retail-side experience a plus.
• A proven history of high level engagement at executive levels.
• A successful partnerships track record with both global 2000, industry-relevant companies, as well as fast-emerging smaller entities strategic to our client’s success.
• A comprehensive understanding of how the mobile phone industry works, including the points of differentiation among the top providers, as well as insights into each company’s strategies.
• Excellent presentation and communication skills.  The ability to create one’s own customized business development presentations on demand.
• Strong financial acuity and experience conceptualizing, presenting, and negotiating a win-win economics structure for both partner and Company.
• Solid “team playing” skills.  This role requires the contribution of many people in the organization to support the “selling effort” by the business development team.

For diagram of success attributes, team description, and compensation, clikc the “more” hyperlink below. 

More…

Position Overview

Reporting to the COO, the new CFO will be responsible for managing all finance, accounting and reporting functions for this multi-campus school. He or she will (1) provide leadership and coordination of all company financial practices, including accounting, budgeting, financial reports, taxes and audit functions; (2) oversee all company accounting practices, including accounting, budgeting, financial reports, taxes and audit functions for the school’s five campuses; (3) assure compliance with all regulatory agencies, including working with outside auditors in preparation of annual financial and compliance audits; and (4) oversee financial aid programs and all associated transfers of funds between the company and the federal government’s Title IV and VA programs as well as the California CalGrant program.

About the Company

Founded in 1985, Platt College is an accredited, post-secondary school with locations in Alhambra, Riverside, and Ontario, CA. The school focuses on allied health, media and graphic arts, and paralegal studies. The school offers eight different course programs, including degree, diploma, certificate and bachelors programs.

In addition, the two campuses of Anderson Medical Career College provide quality training in the fields of nursing and allied health.

Platt College is accredited by Accrediting Commission of Career Schools and Colleges (ACCSC), recognized by the US Department of Education to accredit institutions of higher education across the United States. The primary purpose of ACCSC and other accrediting agencies is to establish and maintain high educational standards and ethical business practices among its accredited institutions.

In August 2008, Caltius Equity Partners sponsored the acquisition of Platt College, Los Angeles, Inc. Caltius partnered with Anova Capital Management, LLC to finance the acquisition and support the company’s immediate and long-term growth initiatives. Anova was founded by two senior operating executives, Akeem Ayeni and Abraham Wu, both of whom joined Platt’s executive management team at closing and remain with the college.

About the Investors

Based in Los Angeles, Caltius Equity Partners has been making control and substantial minority equity investments in amounts ranging from $5 million to $20 million since 1999.

Anova Capital Management, LLC combines private equity investing with active engagement in the strategy and operations of its portfolio companies. Also LA based, Anova specializes in working with small and medium sized companies who desire an “on-the-ground” partner to jointly explore and realize value creation opportunities.

The Position

Reporting to the COO and working with the CEO and company’s investors, the new CFO will drive all financial management decisions for Platt College as it achieves healthy growth.

Specific responsibilities and expectations include the following:

•  Oversee all company accounting practices, including accounting, budgeting, financial reports, taxes and audit functions for all campus locations.
•  Assure compliance with all regulatory agencies, including working with outside auditors in preparation of annual financial and compliance audits.
•  Oversee financial aid programs and all associated transfers of funds between the company and the federal government’s Title IV and VA programs as well as the California CalGrant program.
•  Assist with financial strategy, planning and forecasting.
•  Synthesize and generate financial reporting for outside accounting firm(s), ownership, CEO, COO and department heads.
•  Prepare financial analysis for contract negotiations and corporate investment decisions. Manage procurement process for meaningful equipment acquisition or major contracts.
•  Assist in refining and/or establishing policies, procedures, internal controls, and analytical processes to ensure timely and efficient execution of finance, accounting and financial aid related objectives.
•  Refine and execute expense monitoring and control procedures.
•  Supervise a Controller and other junior accounting staff members.

The Career Opportunity

To an experienced CFO with relevant Title IV experience, this opportunity offers several attractive features:

•  The opportunity to join a small executive team and have “a seat at the table” as the college and investors chart its future
•  The opportunity to work with the current investors in evaluating growth options, including acquisitions
•  The opportunity to be the principal financial decision maker in a company capable of growing to $60MM or more within 3-5 years
•  The opportunity to attain significant equity in the company
•  The opportunity to work in an attractive LA location

The Ideal Candidate

The ideal candidate is working as Chief Financial Officer or Vice President of Finance for an accredited for-profit college that enrolls students eligible for federal financial aid funds under Title IV legislation. He or she has worked with Campus Presidents to oversee all company accounting practices, including accounting, budgeting, financial reports, taxes and audit functions for these campus locations. S/he has also helped to maintain accreditation and Title IV compliance, and together with a COO/CEO and investors to secure additional funding and/or in an M&A capacity as opportunity presents.

This individual is a “player/coach”—strategic enough to handle critical financial management issues but also hands-on enough to manage day-to-day cash flow at the campus level.

Specifically, this individual has –

•  Specific experience with Title IV and other financial aid programs, regulatory compliance, revenue recognition, reviewing account reconciliations, and pro-forma analyses, all within a for-profit college that grew from less than $20MM to more than $50MM within three years
•  An extensive background in financial management with particular strengths in the areas of financial statement preparation, budgeting/forecasting, financial analysis, internal controls, process improvement, and cash management
•  Experience working with external parties, e.g. private equity investors, bankers, consultants, and independent accountants; experience reporting on, and monitoring compliance with, bank covenants; M&A and/or IPO experience would be valuable
•  A bachelor’s degree in Accounting, Finance or a related field; a Master of Business Administration degree and/or designation as a Certified Public Accountant would be a plus
•  A management style that is decisive and entrepreneurial; strong conceptual, creative, and problem-solving skills; a self-starter who is capable of managing his/her time and priorities effectively while successfully accomplishing planned objectives
•  A track record of exerting strong fiscal control (appropriately managing/conserving cash) and driving EBIT bottom-line growth
•  Experience developing and implementing financial processes and procedures that are scalable as an organization grows
•  Experience managing finances for a multi-location organization
•  Experience bringing a strategic level of leadership to the finance function, serving as financial strategist while managing a the day-to-day requirements of a finance department
•  Superior business and financial analytical skills–success with timely monthly financial reporting, detailed financial analysis, and the preparation of ad-hoc reports and analyses, cash flow planning, and management

Culturally and temperamentally, the ideal candidate is a team player who believes that individual success flows from the overall success of the organization.

This involves a range of personal attributes– flexibility and adaptability; a great work ethic; leadership with minimal supervision; an ability to analyze and evaluate one’s own (and other’s) performance and to develop plans to improve performance; excellent presentation skills; willingness to take responsibility for both success and failure—a thick skin; self-confidence and a positive attitude about self, company, and marketplace; consistent, effective prospecting skills—knowing how to reach decision maker; effective listening and questioning; sincerity, trust, believability and warmth; and a strong desire for success.

Compensation

Compensation will include salary, bonus, and equity in line with the individual’s experience.

Travel

Travel is unlikely to be more than 10%. .

BOSTON, MA, August 00, 2012– BSGTeam Ventures (BSG) today announced the appointment of Todd Hand (www.talentbench.net/company/principals/) as Managing Director of TalentBench (www.talentbench.net), a division of BSG. Todd has more than 15 years of search experience in the same innovation-driven industry sectors asBSG. “I’m excited to have Todd join us to run the TalentBench brand,” said Clark Waterfall,BSG Managing Director. “Todd has been an industry colleague and friend for more than 15 years. The synergies run deep.”

Before joining TalentBench, Todd was Vice President of Sales and Marketing at Altela, the leading company in water treatment for the oil and gas industry, where he was responsible for identifying new business sectors and driving revenue in the U.S. and international markets. Prior to Altela, Todd was COO at CleanSwitch Solar, a photovoltaic engineering and integration company. He also raised venture capital financing for Talent Capital Group, an executive search firm that recruited leaders to drive the success of innovative companies in the technology and renewable sectors. Previously Todd built management teams for both Idealab, a creator and operator of technology companies, and the Yankee Group, the global technology market research firm.

Todd serves on the board of directors of Coronado Ventures Forum, an organization focused on educating and connecting entrepreneurs with private equity financing. He is a graduate of Pennsylvania State University and attended the Babson MBA program. “TalentBench expands our recruiting services,” said Todd, “and helps emerging technology companies who want the quality of an executive-level retained search for their key individual contributor through to their Vice President-level roles.”

[This is part 1 of a 3 part series on the evolution of leadership theory—the history, most recent thinking on the topic, and what to look for when trying to identify it, including a look at charisma, executive presence and their contributing roles to successful leadership]

___________________________________________________________

As retained executive search consultants, we are constantly interviewing and assessing executive talent for our clients.  After interviewing these candidates, our clients often reference key characteristics they found (or didn’t) in an executive that are not found in their resumes—charisma, executive presence, or other purported leadership behaviors that are generally thought to be important to success.

But clients continue to ask questions about these traits that sit in the invisible spectrum.  Is charisma an essential ingredient to leadership? If so, for all sizes and types of companies?  Are there other types of leadership where charisma isn’t present and are they successful and in what types of circumstances? What about management versus leadership?  How do we define the differences, and when is a manager better suited than a leader?  And what’s up with “executive presence”? Is that just another term for leadership, or is it different? How? Are these differences important?

All great questions.   And—although we won’t be able to answer them all here in appropriate depth and breadth—we’re going to try to lift the curtain a bit.

With the book and now movie, “Moneyball,” the question of what to look for and what to measure in picking leaders for organizations should be rethought.  In “Moneyball,” the fulcrum of the book is based on a different way of measuring the potential and future performance of pro baseball players.  In the book, the Oakland A’s general manager turned upside down what had been considered the gold standard for sports talent assessment by baseball scouts in favor of a much less obvious and intuitive set of statistics.   Pro baseball would never be the same.

So, adapting this concept, it’s worth reviewing some popular (mis)perceptions of what makes a leader.

First principles—What does an organization need: Leaders or Managers?

Leaders/leadership by its own definition indicates the following situational characteristics—

Where one is now is not where one should be.  Rather

1) One should “follow” someone or something to another place, in theory a “better place”

2) This “better place” is both NOT self-evident (convincing is required), AND

3) It requires effort to get there, and is not frictionless, calorie-free, or zero-cost.

Managers, on the other hand, are most often those who create efficient operating systems once the “better place” has been reached.

Charisma as an essential ingredient to successful leadership—True or False?

The world “charisma” comes from the Greek word for “gift.”  Charisma is better thought of as a skill that enhances leadership effectiveness by dint of a superior ability to influence others to change their initial positions, perspectives, or opinions.

I was first offered a deeper insight into the concept of charisma in leadership by the teachings of Rakesh Khurana, a professor at Harvard Business School.  Dr. Khurana has done extensive research and writing on the topic, from articles in Harvard Business Review (“Curse of the Superstar CEO”, HBR 2002, http://hbr.org/2002/09/the-curse-of-the-superstar-ceo/ar/1) to complete books on the topic (Searching for a Corporate Savior: The Irrational Quest for Charismatic CEOs http://www.amazon.com/Searching-Corporate-Savior-Irrational-Charismatic/dp/0691074372).  More popular business authors like Jim Collins, author of Good to Great, wrote about “Level 5 Leadership” and addressed charisma in relation to this “top leadership level.”  Collins has been quoted as saying, “Being charismatic and wrong is a bad combination,” and “I’d go so far as to say that [The Level 5 leaders Collins chronicled in the good-to-great success case studies in his book] were uncharismatic for the most part.”  (http://www.amazon.com/Good-Great-Companies-Leap-Others/dp/0066620996/ref=pd_sxp_grid_pt_0_0)

Regardless of good or bad use of charisma, there is still a great deal of additional research and writing on the topic.  Clearly we associate the effects of charisma with enhanced motivation, inspiration and intellectual stimulation it engenders in the listener.  But can it be taught?  One branch of research surrounds this argument.   If you read the works of Professor Robert House at University of Pennsylvania’s Wharton School, he deconstructs “how” charisma works.  From House’s work, one could infer that charismatic behavior may be both “born in,” but also taught with enough study and practice (http://knowledge.wharton.upenn.edu/papers/674.pdf).

The Dangers of Charisma

What are the pitfalls of charisma in the corporate context?

• Charismatic executives tend to suppress individual thinking and leadership development in subordinate teams.  Leaders with charisma can create a culture of “followers,” rather than young, budding leaders and the next generation of a company’s executive team.  Narcissistic tendencies don’t allow others to flourish instead creating dominant monolithic thinking, “I don’t even argue with him anymore because I always lose.”

• This in turn leads to challenges for succession planning.  Often charismatic leaders leave a vacuum of next generation leaders, having created instead a strong set of followers.

• Life of the party isn’t always “engine of achievement.”  Charisma can be used to achieve personal goals as the primary objective, at the expense of organizational goals.  There is no question it is always best to have alignment of personal and organizational goals so that by achieving one, the other is also achieved.  However, this mandates that the charismatic leader be programmed to strive for a “win-win,” vs. a “win-lose.”   In fancy organizational behaviorist language, this ends up being the difference between those leaders who have “higher activity inhibition” and those who have lower levels.  If a leader has lower activity inhibition, they tend to seek win-lose outcomes with the “win” side being the individual over the organization.

What can the charismatic leader do to counteract negative repercussions?

The charismatic leader needs to ensure that they either surrounds themselves with others who have strong self-confidence and ideation, or that the charismatic leader makes a great deal of effort to cultivate an environment open to sharing other opinions, perspectives, and ideas rather than defaulting to “the charismatic boss.”

As referenced earlier, charisma is really more situationally valuable.  Typically, charisma is most valuable when change is the goal.  Innovation, revolution, new paradigm adoptions are the best projects for the charismatic toolbox.

Some popular examples of positively and negatively directed charisma include the following:

Good = Sir Ernest Shackleton, and the failed Antarctica expedition he saved | John F. Kennedy | Martin Luther King

Bad = Hitler |Jim Jones and the 909 deaths in the Jonestown massacre in 1978 where Jones as dogmatic cult leader got all his followers to commit mass suicide

A few additional interesting links to resources on charisma and leadership

http://money.cnn.com/magazines/fortune/fortune_archive/1996/01/15/207161/index.htm [lighter reading]

http://www.aom.pace.edu/amj/february2001/waldman.pdf [heavier reading]

How & What Growth-stage CEOs Are Ending 2011 & Planning for 2012

Below is the hyperlink to take the Q4 CEO peers speed-survey, exclusively for growth-stage CEOs. This survey focuses on “How & What Growth-stage CEOs are Ending 2011 & Planning for 2012″

This shouldn’t take more than 5 minutes of a busy CEO’s time–

We here at BSG Team Ventures periodically take the temperature of the markets we serve. The survey is no more than 15 questions, most simple multiple-choice.

These surveys are created and compiled by BSG Team Ventures as a courtesy to our executive ecosystem with the belief that knowledge is power. Aggregated peer-provided knowledge is “actionable power.”

To compare how you’re feeling a year later with the survey results from Q4 2010, titled “CEOs Plan for 2011”, go to http://www.bostonsearchgroup.com/blog/q4-2010-ceo-survey-of-growth-stage-companies/

We make an effort to survey only those who fit the category (in this case, sitting CEOs or board member/founders of technology/science-driven growth-stage companies). [Note, if you don't fit the aforementioned description, please refrain from responding.]

Feel free to forward to the qualified CEOs in your sphere of influence. The more data generated, the more accurate the trend lines.

All responses are anonymous due to the web-based survey technology employed.

We will forward the survey results within the next two weeks to the email address on file. Please let us know if there is another email address you wish us to send the results to as well.

The Position

Reporting directly to the CEO, the Vice President of Marketing will play a senior leadership role within the management team, overseeing all branding, customer acquisition, public relations, and channel marketing efforts.

Core Responsibilities: This position will be responsible for the overall success of the Company’s consumer offering, including user acquisition/adoption/retention and general management of the brand.   The VP Marketing will build a business-to-consumer marketing function focused on the customer experience. He/she will also identify opportunities for increasing value and optimizing revenue growth and will ensure consistency in messaging across integrated marketing channels.

The VP Marketing will lead the Company’s  strategic and tactical consumer marketing initiatives and will assist with the development of the overall corporate strategy, vision, messaging, and product direction. He/she will be responsible for the creation of an innovative marketing strategy and outreach program for the Company.  He/she will also act as a key external evangelist for the company when called upon.

Specific responsibilities include:

Qualifications & Experience

Skills & Personal Characteristics

Ideal Candidate Profile

The following diagram illustrates the intersection of competencies critical in the VP Marketing position:

Planning for executive staff additions or replacements seems to be higher on CEOs’ New Year’s resolutions again in 2011. Just a year ago, in December 2009 and January 2010, CEOs broke out of their executive hiring deep-freeze and search activity showed unprecedented momentum.  CEOs had been holding their breath for all of 2009, witnessing Wall Street carnage, plummeting consumer spending, and massive macro-economic uncertainty.  Just as consumers in the 2010 Christmas season finally decided to spend more,  boards of directors and CEOs are counting on better economic conditions in 2011 and executive hiring is again back on the corporate shopping list (see recent growth-stage CEO survey, Q4 2010, http://www.bostonsearchgroup.com/blog/q4-2010-ceo-survey-of-growth-stage-companies/)

So, what to be aware of when looking at executive talent acquisition this year?

Here are 5 tips:

1)     Candidate shelf-life is shorter than you think

Just as the warning on automobiles counsels that “objects in mirror are closer than they appear,” a similar mantra exists for talented executives.  Recession is a great retention tool, and has allowed many CEOs to keep their executives with little fear of their departure.  However, today’s market for executive talent is heating up.  We’ve read the articles about companies poaching Google talent, but this is not exclusively in Silicon Valley, or with the big tech behemoths.  Talented executives may be willing to consider a move, but they are savvier than ever, will look to try to identify several opportunities to evaluate in parallel, and pick the best perceived fit in a narrow time window.  Companies who in 2008 and 2009 had the luxury of interviewing twice as many candidates as normal due to temporary supply/demand imbalances no longer have that extra time on their side to interview more, or take longer to make decisions.  Candidate shelf-life is finite.  And the market window is shorter than we might think for any given talented executive.

2) Q1 2011 bonus payouts make candidate resignations difficult

Candidates may have a hard time giving notice in Q1 due to pending 2010 bonus payouts.   There are often 2 options—

a)     The finalist candidate will accept the new company’s offer, but won’t give their notice until after bonus checks have been cut (sometimes coming as late as February or early March)

b)     Finalist candidates will ask that their new companies include in the offer a signing bonus that helps to “keep them whole” on any bonuses they are walking away from.  This can quickly get expensive for the new employer, with numbers ranging from $50,000 or $100,000, to $.5M or more, depending upon the position, the compensation package, etc.

3) Relo has always been hard, but today’s real estate values make it much harder

Many executives are upside down in their residential real estate.  Again, this creates a two option decision for the new employer—

a)     Increase the boilerplate relocation package to include relief on any equity deficit the executive faces in selling in a down market.

b)     Be more flexible on where the executive can live.  Yes, there is no question that a best practice is to have the executive live within an easy drive of corporate HQ.  However, with ubiquitous email access in trains, planes, and automobiles, there is an every growing body of evidence that “local” isn’t the only choice for executive domicile.

4)  Equity is often no longer the great equalizer

When the public markets allowed IPOs more readily, and there was generally more liquidity for fast growth and mature companies alike, the tradition of 10-20% base salary increases  in moving from one company to another became subordinated to “how much stock/equity can I get?”  That popular refrain has been replaced by a much more pragmatic and balanced approach to executive compensation, where cash is again king.  Except in rare circumstances, executives want to have some of their incentive on a cash basis, balanced off with an equity upside. (for example of CEO Equity Compensation Calculator, see http://www.bostonsearchgroup.com/blog/ceo-equity-compensation-calculator/)

5) Executives know now more than ever what their peers earn

Whether it be due to frequently published executive compensation surveys, unprecedented numbers of databases providing comparables earnings info, or newly imposed Sarbanes-Oxley disclosure rules on public company executive compensation, executives are much more sophisticated about what their worth on the open market may be.  They also share much more readily with their peer group.  Employers in 2011 should be cognizant of this when crafting a package, and care should be taken to engage the executive in what they feel their worth is, and the data/information they are using to establish that value. (for example, see http://www.bostonsearchgroup.com/blog/venturebacked-executive-compensation-study-vp-levels-west-east/)

6)     [bonus tip] International is more important than ever in ’11

Yes, China and India may both represent great offshoring opportunity and new revenue markets, however talent from these markets are an equally or more important asset.  Just sending US citizens abroad as ex-pats doesn’t cut it anymore.  Hiring foreign nationals with experiences in certain international target markets is key to breakout performance.  An Indian national with several years experience selling/managing in Asia is a wonderful combination of skills and experience critical in driving companies through the next level of global growth (for more, see http://www.bostonsearchgroup.com/blog/collision-course-between-executive-leadership-succession-and-global-demographic-trends-in-coming-decade/)

Each quarter we survey growth stage CEOs who are running innovation driven companies.  This quarter,  we had more than 60 CEOs responding.  CEOs were running companies in broadly defined technology (software, hardware, semiconductor, telecom), Internet (e-commerce, media, social, entertainment), medical devices, biotech, and cleantech / renewable energy sectors.

A note on methodology.  We send these surveys only to those who fit the category (in this case, sitting CEOs or board member/founders of technology/science-driven growth-stage companies).    All responses were anonymous due to the web-based survey technology employed. The majority of respondents were in the United States, with the highest concentration on the East and West coasts (New York, Boston, and San Francisco/Silicon Valley areas).

For prior survey results from Q2 2010, titled “Impact of Economy and Renewed Growth”, go to http://www.bostonsearchgroup.com/blog/ceo-survey-results-q2-2010-%e2%80%93-impact-of-economy-renewed-growth/ .

ECONOMIC CLIMATE

The first set of questions was around the economic conditions in which each CEO felt s/he was operating.    One question we continue to ask and re-ask over the last six quarters or so targets the turbulence in the macro- economic climate.  It is interesting to compare CEO responses to the same question, “Do you anticipate a double dip in the near term future?”

* In Q3 2009, more than half  (54%) of CEOs polled were expecting a double dip, and planning accordingly

* In our Q2 2010 survey,  again 50% felt a second economic correction was likely, the biggest percentage of those CEOs believing it would be in either Q3 2010 or sometime in 2011.  The other half  of CEOs felt the specter of recession was behind them

* Currently in Q4 CEOs were consistent with prior quarters with a bit more than 50% indicating they didn’t feel a double dip was likely, and the other half of the CEOs saying either a 50/50 probability or greater (16% feeling more likely than not)

So less than 1 in 5 CEOs feel another economic dip is likely.  No CEOs selected the ” greater than 75%” probability.

It’s interesting to do a meta graph of the changing CEO sentiment on this question.  Surprisingly, the graph would be sloping downward, but not as much as many would hope.  The high point was certainly back in Q3 2009, but even throughout 2010, as many CEOs were fearful of a negative correction as those who felt it was behind us.  No doubt this “lack of confidence” index doesn’t inspire the CEO with a swashbuckling, damn-the-torpedoes-full-speed-ahead attitude toward growing their companies.  Rather, it makes CEOs think in short-term windows, perhaps 3 months at a time, with little appetite to make medium or long-term bets.

Those CEOs who felt another downturn was likey referenced several factors that might tip the scales negative–  gridlock in Congress due to midterm elections and likelihood that Democrats lose congressional majority, a belief that a bad Q4 holiday retail shopping was likely, and the persistent overhang of ongoing commercial and residential loan defaults.

As for when another economic dip might occur if it were to occur, the vast majority of CEOs pointed to Q1, 2011, with Q4 of this year and Q2 2011 tying for second at 18% each.

STRATEGY

Almost 50% of CEOs polled said that they had either made a shift in strategy in 2010, or were planning to in the near future.  Granted, growth-stage companies are prone to shifting strategy until they land upon the best formula for significant and sustainable growth.  However ~50% is a big number, and clearly a chunk of those companies have been driven to rethink their strategies because of the challenging economic climate, the concern over the future, and the possibility that 2010 might represent “the new normal” where with no economic “rising tide” no help generated to float all company boats as in periods of economic expansion in the past (1997-2000, 2005-2008, etc).

CASH FLOW

The majority of CEO survey respondents (49%) indicated that they were still planning on burning cash over the next 2 quarters.  24% indicated they would be profitable.  CEO comments regarding this question indicated an overwhelming drive toward cash flow break even.  That was the big push and focus for their companies in 2010, and if they hadn’t achieved it yet, they were gunning to by end of the first quarter of 2011.  CEOs also commented that they were trying to run their companies at break even, with any extra EBIT being reinvested back into the company for additional growth.

COST REDUCTION PLANS

When asked what were the top 3 areas CEOs were targeting for cost reduction, the following table summarizes their responses, representing a combination of spend reduction and staff reduction in non-core areas.  There was a preference by CEOs to favor non-staff cuts over cutting headcount if at all possible, but many acknowledged that in order to make meaningful cuts, staff had  to be considered in the equation.

CEO responses when asked about increasesin spend were logical.  The top three in order were sales, marketing, and R&D.  Many of the comments about this question noted the fact that outside of directly growing revenues, additional spend was hard to build in when many CEOs are driving toward a minimum cash-neutral mandate and economic uncertainties are driving CEOs to think conservatively rather than expansively.

[Click on "more" below for remaining 8 slides and narrative from Q4 2010 CEO survey]

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Survey of 50 of the Fortune 500 companies reveals how long executive searches take, the average number of candidates interviewed,  how many of them actually get completed, and what percentage of those candidates are female or minority.

As executive search consultants, we often get asked a series of questions by our client companies surrounding the executive search process.  Many of these questions are driven at gathering market intelligence around our executive recruiting.   The aim?  To create some third-party benchmarks to help companies understand whether a search has gone about average, better than average, or (gulp) “below the mean.”  Keep in mind, these could be internally run searches done in the “DIY” fashion.  Or searches executed by in-house recruiting departments or human resources staff.

Historically, there has been precious little data generated by third-party sources with enough statistical heft to garner much credibility.

One of the sources that at least aims to collect good data is created by David Lord, who heads the Executive Search Information Services organization.  David is a veteran observer and analyst of the executive recruiting industry, and has run a roundtable of senior talent executives from Fortune 500 companies for the last 20 years or so.  For further information, see www.davidlord.com.  Some of the data that ESIS collects is via an annual survey of those senior human resources executives who participate in these roundtables.

For our clients, we often reference ESIS data when made available.  At our request, below is a data table we created from some of the information ESIS kindly provided that shows some longitudinal data over the last 4  years, 2006, 2008, and 2009.

Trends worthy of note?

Search completion times have come down by almost a month from near 5 months down to 3.5 months.  Good news for all, the company, the candidates, and the search firm.   It will be interesting to see if this flattens out, or jumps back up for 2010 due to tightening talent pool on the supply side as the economy began to pick back up this year.

Number of candidates interviewed per hire dropped from 6.5 to ~5.  This could be an indication of a company’s increasing confidence in what they’re looking for, or an indication of sense of urgency around key hiring to help companies as they struggled through a very tough 2009.

Female and minority hiring at the executive level has improved, but not as much as many would have thought. Women executives were hired 29% of the time in 2009 versus 23% in 2006.  Compared to the workforce percentages of women to men, this is still inversely proportioned.  Minorities have seen a nominal increase of 1% more hired over  the last 5 years, which–when considering rounding errors– is effectively no increase at all.

Search completion rates have remained flat, with 4 out 5 searches engaged getting completed. Over the last 5 years,  search completion rates have hovered around 80%.  This is reported by corporations only, so subject to different numbers search firms might proffer.

Retained executive search statistics, 2006-2009

For deeper data, please contact ESIS.

Additional footnotes worthy of note:

1) For some reason, executive search firms specializing in the financial services sectors and related areas often calculate their “days to complete” numbers counting only business days, excluding weekends and bank holidays.  This can often make comparing normative data a bit more troublesome

2) Days to completion numbers are calculated using the date of accepted offer of employment, not candidate start date/first day of work.  This is done because resignation periods vary widely and would undermine data integrity.