Lou's Views

Execution Über Alles

Jack Welch wrote, Winning, a tome proclaimed by Warren Buffett as, “No other management book will ever be needed.”

Chapter 6 is titled “Hiring”. Welch states that, “Hiring good people is hard. Hiring great people is brutally hard.” Is there a successful manager, in any company that has scaled, who would disagree with Jack’s statement? Economic factors such as misunderstanding opportunity costs (functional tasks vs. recruiting tasks of the hiring manager) and psychological behaviors such as the scarcity heuristic and groupthink impede and bias the hiring process. I succumbed to these issues in my early operational career building marketing and sales teams. Assisting a client to avoid these roadblocks is essential in the hyper-competitive IT hiring environment.

Returning to Welch, Chapter 6 includes a discussion of his 4-Es, a framework for hiring:

  • Positive Energy
  • Ability to Energize Others
  • Edge, the courage to make tough yes/no decisions
  • Execution

No-brainers on the interview checklist, all of them. Who doesn’t want colleague with such a dream profile. The reality is the controversy associated with the effectiveness and administration of psychometric tests that measure observable variables or statistically model latent variables such as Welch’s first three attributes (Harvard Business Review, paywall). The HBR article noted a study in which both personality and emotional test scores had validity coefficients < 0.25 in predicted job performance. And these results were based on testing in controlled conditions by accredited professionals. So, what credibility should we attach to the earnest, seat-of-pants responses provided by the interview team whose academic credentials and/or competency might range from computer science to operations, but not behavioral psychology. Assessing personality attributes in the interview process is more likely a measure of the interviewer’s confirmation bias.

All is not lost in Welch’s list as Jack struck gold with “execution”. In fact, “execution” was not included in the original version; Welch realized its necessity when his head of HR (the operationally-brilliant Bill Conaty) observed that executives with high marks in abilities such as energy and edge were great people, “but some of their results stink”.

Business execution is results, and business results are numbers. The interviewer can probe deep in the responsibilities that the candidate has emphasized in the resume, e.g., percentage increase in sales attained with a different sales model or the increase in PPC ROI using a long-tail platform or the percentage decrease in costs of software development. The interviewer affords the candidate the opportunity to discuss her contributions, from business strategy to organizational optimization to a financial result in the income statement.

Regardless of which side of the interviewing fence you stand, be prepared to discuss the business results that demonstrate execution.

Execution over everything.