CEO: Hire industry experience or job competency

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Entrepreneurial scale to a certain extent, always encounter this problem, whether to cultivate managers from within, or from outside employment. The advantages of internal culture is cultural consistency, operation and team familiarity, but the disadvantage is that there may be a lack of management experience, everything must be wrong to learn, so mature time and cost is also larger. In contrast, foreign senior managers can bring industry contacts, meet the urgency of the time, and solve the problem of internal talent shortage. But the disadvantage is that people and the company's business model of the formation of the cause and effect is not familiar with, may also have the impact of culture.

In the weekly "Entrepreneurial ceo" series, we discuss how entrepreneurs can teach themselves to be great CEOs because the greatest startups in history are often led by such people. "

I know it's not a creative idea to quote Matt Blumberg three times in a row, but I have to say that Matt has been in full fire lately, last week this debunking the Myth of hiring for Domain expertise vs. functional Expertise made me think for a whole week, so today I decided to bring it up for discussion. By convention, I encourage you to read the article first, and then look at some of my thoughts.

Employment vs. promoted

Startups scale to a certain extent, always encounter this problem, whether to cultivate managers from the inside, or from outside employment. The advantages of internal culture is cultural consistency, operation and team familiarity, but the disadvantage is that there may be a lack of management experience, everything must be wrong to learn, so mature time and cost is also larger. In contrast, foreign senior managers can bring industry contacts, meet the urgency of the time, and solve the problem of internal talent shortage. But the disadvantage is that people and the company's business model of the formation of the cause and effect is not familiar with, may also have the impact of culture.

Industry experience vs. Job Competency

Therefore, when the company has such a demand, and indeed can find a cultural consistency of talent, coupled with the CEO can spend a lot of effort to help him enter the condition, a Startup will choose to add foreign senior managers. At this time there is a saying, is you otherwise get industrial experience (Domain expertise), otherwise is the position ability (functional expertise), but both difficult to balance.

What do you mean?

Industry experience refers to the business experience related to your industry, the ability to work refers to the job you are looking for a wealth of management and operations experience. Theoretically the two can be both, but in practice it is difficult, why?

Take a slightly simpler, but easier to understand example: if you're a Facebook that's just risen in the 2006, you need to find a foreign senior CFO to prepare for a future listing. If you are looking for a financial chief with extensive experience in the Internet industry, you can only dig up the CFO of Google, Amazon and EBay. These companies are at their zenith, the CFO's salary position is very lofty, you are only one of those who seems to have the potential of the Startup, but even the business model is not yet, such a company every year dozens of, it is almost impossible to persuade the big CFO to join you, or to break a leg (a large stake) to change.

So you tend to take the next step and choose to find the financial staff in these companies, those who are under pressure in the short term, such as the so-called industry experience, but do not have the ability to position. Or you can find the CFO of a listed company in other industries, maybe the industry or the company is in bad condition, they will be willing to join the potential of emerging industries, that is, have the ability to work, but no relevant industry experience.

Scale Experience

But Matt put forward another argument, in fact, in addition to industry experience and job capacity, another key experience is often overlooked, that is, the "large-scale process" familiarity. The company's scale will not be once in place, in practice it is more like climbing stairs, each stage has a stage of work and goals, there are very many eyebrows angle needs attention. If a senior foreign manager has a similar experience, every step of the way you climb this staircase can give you a lot of important reminders, and it will save the company many meaningless mistakes.

I can prove it personally. Joseph, one of Appworks's partners, joined the CID early in the 11-year service where he was first-hand involved in the CID's expansion from the 20-person team to nearly five locations across the globe, Also witnessed the huge growth of their funds and scale, so on the appworks scale of the road, he is often our most important beacon.

So, as Matt said in his article, since you're dealing with the problem of "scaling up," it would certainly be helpful to attract people with this valuable experience.