The last time I saw some confusion around why an executive was making a change in industry was back in 1997 to 2000. This was the dawn of the “internet age.” Executives were leaving traditional industries like financial services, management consulting, retail, and even manufacturing, because there was a new thing called the Internet that was going to “change the world.” In the earliest of those years of 1996 and 1997, there were the early adopters. These executives were truly missionary. Money hadn’t been made yet in the Internet sector, and trails hadn’t been blazed. Those early pioneers had caught a glimmer of a powerful disruptive technology, and were keen on experimenting with it, with the aim of changing the world as we know it, and how things get done.
There are some industries that have always been missionary, and have attracted a consistent flow of executive talent toward them. The education industry attracts innovators who want to find a better way to sculpt and expand the minds of our children and young adults. The medical devices industry wants to help innovate tools and components that will allow us to repair our bodies, or extend their useful life. The biotech industry wants to find new ways to pinpoint the reasons and sources of disease and develop novel ways to cure them, whether seeking the cure for cancer, cure for Alzheimer’s, or other terrible human disorders. Cleantech is likely the newest addition here.
The reasons executives decide to change industries are many. One popular reason is “I’ve done well, now I’d like to do good.” You see this often in the investment banking industry, where wealth can be made, but “doing good” is rarely part of the equation. Therefore, frequently these and other similar executives achieve doing well and doing good in a “serial” fashion, when Maslow’s hierarchy of needs kicks in (http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs ).
Back to our comparison of the Internet craze and today, and how this impacts why executives decide to change industries, during the Internet craze, we were in an economic upswing. Yet, it wasn’t such a stark contrast as we see today in our current state of economic adversity. Then, in the late ’90s, there was a much smaller difference between an ability to earn a good living versus create an insane “wealth creation event” via a dot-com IPO in less than 2 year’s work. It’s wasn’t perceived as binary, “if I’m not in Internet, I’m at risk of being unemployed.” In today’s market, this is often the reality. Is the motivation, drive, or reason to look at the cleantech industry altruism, or self-interest in the executive’s value system? Or, is it possible and desirable to have “enlightened self interest” in a leader who is changing from one industry into one more in vogue like cleantech? One where the sheer proliferation of terms to alternately describe the industry is an indicator of its popularity– greentech, renewables, sustainable energy, and other popular terms used interchangeably today.
Now, the vast majority of both growth-stage and mature-stage industry sectors are suffering. As a result, it pushes our challenge as executive recruiters-or for anyone who’s assessing talent to add to their teams-to determine how much missionary versus mercenary is driving an executive’s decision to make a change.
This teeter-totter of altruism versus self-interest John Doerr popularized in the late 1990s as a Partner at well-known venture capital firm Kleiner Perkins. For a good snippet from Doerr’s thinking, go to blog post http://constructiveventures.wordpress.com/2008/04/27/mercenaries-vs-missionaries-the-next-wave-of-entrepreneurs/ . For a deeper dive, you can see Wharton article, http://knowledge.wharton.upenn.edu/article.cfm?articleid=170 .
Today’s executive assessment challenge is to first determine what the mix of mercenary (M1) and missionary (M2) is in the executive’s motivation to change career focus from their current industry to cleantech. We need to make sure that there is a healthy enough balance, 5X% missionary, 4X% mercenary, and then make sure that this DNA matches that of the existing executive team to maximize the probability the executive will stay through good times and bad.
A derivative question arises at this point-Is it best to mix M1s and M2s together in a team, or select for homogeneity? If you had a subset of executive team members who were missionary, and another faction who was mercenary, the cohesion of the entire team is likely doomed. Offsetting too missionary a culture by counter-balancing with a few mercenaries is not a recipe for success. Rather, there should be a balance within each individual.
The risk of missed assessment? A fair-weather executive. Someone who-when the going gets tough, or when a more lucrative, safer, or easier role pops up on the radar-will fledge the existing nest for what they perceive as a more attractive roost. What the next more attractive sandbox will be is hotly debated. However, in this economy, other than government and eHealth/healthcare IT, cleantech is the new land of opportunity, and it will attract both missionary and mercenary entrepreneurs. If you agree with any of the above, the challenge is to figure out how to tell them apart.
Footnote to assessing “motivation“: In assessing this decision to make a change, there is sometimes confusion around the use of the word “motivation.” At times, executives are assessed for their “motivation,” which is referring to drive, not motive for seeking a new role.
