EXECUTIVE TALENT Nature, Nurture and the Environment of Innovation - Moving from future shock to future leading
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EXECUTIVE TALENT Volume Fifteen
Nature, Nurture and
the Environment of
Innovation
Moving from future shock
to future leading
Executive Research
Intelligence
Trend-Spotting:
A Futurist's Perspective
Welcome to Volume 15
from Karen Greenbaum, AESC President & CEO
W
ith this issue of Executive Talent, we are kicking off the year-long celebration of our
60th anniversary. In preparation, I have reviewed AESC Board meeting minutes all
the way back to 1959 when AESC was founded. I was so proud to see the names of
so many well-known leaders of our profession. These leaders understood quality, integrity and
trust as cornerstones of our profession and saw the establishment of a professional association as
key to our long-term success. Today, our association has evolved to reflect the expanded role our
members play in strengthening leadership worldwide.
• Recent AESC research identified HR, relative to other functional
departments, as one of the least prepared for digital transformation.
We explore how AI sourcing, assessment technologies and new
sources of data are radically changing the face of talent acquisition.
• How does a person develop the thinking skills and the breadth of
knowledge necessary for leadership? Erica Orange, futurist, shares
with us current trends and how they are shaping the future of work
and society.
• Like all disciplines, executive research is not immune to disruption.
To meet the demands of an evolving role, executive researchers
are developing new skills and adapting to new challenges. Experts
in the profession share with us the shift from research to research
intelligence.
• The authors of Go Long share powerful anecdotes from industry
leaders, looking at the pitfalls of short-term thinking against the
wisdom of a long-term vision.
• The digital information age continues to give rise to new economies
and tech sub-sectors. AESC Partner, Cluen, explores the question—
trusted advisor or trusted algorithm?
• Companies are actively looking to improve equality in their
recruiting practices. AESC Partner, Invenias, shares new findings
from their global survey with MIX Diversity Developers on diversity
and inclusion.
Thank you to the many individuals and firms who participated in the interviews and contributed
to the research for this issue of Executive Talent. As always, I welcome your feedback on all matters
relating to global executive talent.
2 - Executive Talent
EXECUTIVE TALENT
The Global Magazine from AESC
Contents
Volume Fifteen
4 A Proud History: The Executive
Board of Directors
Paul Benson, Chair of the Board Search Profession and AESC
Senior Client Partner, Global Head of Infrastructure, AESC celebrates 60 years in 2019. To mark the occasion, we
Construction & Services, Korn Ferry - London explore the roots of the profession and the Association, and
Morten Nielsen, Vice Chair of the Board map how far we have come.
Senior Partner, Life Sciences Practice, Witt/Kieffer - Cleveland
Ineke Arts, Secretary Treasurer 12 Fertile Ground: Nature, Nurture
Partner, Hoffman & Associates / IIC Partners - Brussels
and the Environment of Innovation
Sonal Agrawal, Board Member Trusted advisors share how early stage businesses make their
Managing Partner, Accord | India / AltoPartners - Mumbai way on the road to scale and success.
Emanuela Aureli, Board Member
Consultant, Technology, Media & Telecommunications Practice
and Data & Analytics Practice, Spencer Stuart - London
20 Talent Technologies
Digital transformation is impacting every industry, geography
Richard Boggis-Rolfe, Board Member and business function. Now it’s HR’s turn to experience the
Chair, Odgers Berndtson - London
impact of some disruptive trends.
Kate Bullis, Board Member
Co-Founder & Managing Partner, SEBA International -
San Francisco 26 Trend-Spotting:
Dorota Czarnota, Board Member
A Futurist’s Perspective
Country Manager, Russell Reynolds Associates - Warsaw Erica Orange is Executive Vice President & Chief Operating
Officer at The Future Hunters, one of the world’s leading
Rodrigo Foz Forte, Board Member
futurist consulting firms. She shares with us current trends
Managing Partner,
EXEC – Executive Performance | Panorama - São Paulo and how they are shaping our future.
Karen Greenbaum, Board Member
President and Chief Executive Officer, AESC - New York 32 Executive Research Intelligence:
Julian Ha, Board Member From Behind the Scenes to the
Partner, Heidrick & Struggles - Washington, DC Front Lines
Alicia Hasell, Board Member Executive researchers are developing new skills and
Managing Partner, Boyden - Houston adapting to new challenges. In the process, they are building
rewarding careers and proving their value.
Nobi Kaneko, Board Member
President, Kaneko & Associates - Tokyo
Cathy Logue, Board Member 38 Go Long: Why Long-Term Thinking
Managing Director, Global Leader CFO and Financial Executives
Practice Group Managing Director, Stanton Chase - Toronto
is Your Best Short-Term Strategy
With powerful anecdotes from industry leaders, we look at
Martin Schubert, Board Member the pitfalls of short-term thinking against the wisdom of a
Partner, Eric Salmon & Partners - Frankfurt long-term vision.
Stefan Spang, Board Member
Senior Partner, McKinsey & Company - Düsseldorf
42 Disruptive Tech’s Impact on
Roxanne Taylor, Board Member Executive Search
Strategic Advisor and Brand Strategist;
Former CMO at Accenture (2007 - 2018) - New York As the digital information age continues to give rise to new
economies and tech sub-sectors, is executive search the next
industry to be enveloped by technology?
Dedicated to Strengthening Leadership Worldwide
Editorial Team
President & CEO Writer & Editor
46 Diversity and Inclusion and the
Karen Greenbaum Martha Clement Role of Executive Search
Rochford
Diversity and inclusion is firmly on the board room agenda
Chief Marketing Officer Senior Designer and companies are actively looking to improve equality in
Joe Chappell Don Hailer their recruiting practices. So what role can executive search
firms play?
A PROUD HISTORY
The Executive
Search
Profession
and AESC
AESC celebrates 60 years in
2019. To mark the occasion,
we will explore the roots
of the profession and our
organization, and map how
far we have come.
Thorndike Deland Sr., founder A SIGN OF THE TIMES management problem is the right person.”
E
of Thorndike Deland Associates, specially in the United States Even before World War II and through
is widely understood to have and Europe, businesses changed the 1940s, a handful of firms were in the
started the first executive search dramatically during the second business of recruiting executives. Executive
firm. According to Mr. Deland’s industrial revolution. In the period from Manpower, run by William Hertan, and
obituary published in The New 1870-1914 innovations like the internal eponymous firms established by McKinsey
York Times, “After World War combustion engine, electric light, and the & Company veterans Jack Handy and
I, A. Lincoln Filene, the Boston production of steel contributed to a period of Ward Howell, and by Booz, Allen &
merchant, then president of accelerating industrialization: the expansion Hamilton alumnus Sid Boyden, all recruited
the Retail Research Association, of rail and telegraph lines improved access executives for client companies. In fact,
called on Mr. Deland to direct to markets and lowered costs for the Thorndike Deland arguably formulated
an executive search activity movement of parts and finished goods; the concept of executive search back in
for member department new, efficient methods of production made 1926, when he founded the first retained
stores.” In 1926 Deland went the process of turning raw material into a executive recruiting firm.
on to establish the Thorndike finished product faster and more efficient. The end of WWII led to a wave of economic
Deland firm, “devoted to This same period saw the introduction expansion and globalization that reached
recruiting executives, many of management consultants who helped across North America, Western Europe,
for the nation's major retailing company leaders adapt to the demands of Japan, Australia and the newly industrialized
companies.” scale and the changing business landscape. economies of Asia: South Korea, Taiwan,
Executive search evolved from the Singapore and Hong Kong, fueled largely
recurring need of management consulting by the growth of international trade.
firms like McKinsey & Company and According to the World Trade Organization
Booz, Allen & Hamilton to recruit the “International trade after WWII entered a
right executives who could implement a long period of record expansion with world
recommended strategy and solve a client’s merchandise exports rising by more than
problem. Indeed, back in 1914 Edwin G. eight per cent per annum in real terms over
Booz said, “Often the best solution to a the 1950-73 period.”
4 - Executive Talent
association in which only competent
and ethical executive recruiting firms
could qualify for membership.”
The Association of Executive
Recruiting Consultants (AERC) was
incorporated on December 18, 1959.
AERC was established for the dual
purposes of creating a professional
association for the most competent and
reputable search firms, and for providing
clients and prospective clients a means
by which to differentiate qualified and
AESC CHAIRS OF THE
BOARD OF DIRECTORS
1959 Francis Canny
1960s William Clark
1960s Hardy Jones
Donald Wright
1960s
Gardner W. Heidrick
1960s
Ward Howell
1960s Rawle Deland
1970s Donald DeVoto
1970s Franklin Beardsley
1970s Gerard R. Roche
1970s George Craighead
1970s Robert Martin
1970s Max M. Ulrich
Businesses jumped on the opportunity An often-cited quote from Sid Boyden
1980s Clarence E. McFeely
to expand their reach, and in a departure explains: “Most resources are available
1980s John Richmond
from the tradition of developing and to all companies. The great variable is the
1980s Leon A. Farley
promoting mangers from within, business quality of leadership—it determines why
1980s William E. Gould
leaders more frequently sought skilled, some companies fail and others succeed." Alden S. Blodget
experienced executives from outside their Economies were heating up, business 1980s
Robert Montgomery
organizations. was booming and as demand for 1980s
Robert L. Smith
talent grew, retained executive search 1990s John H. Callen, Jr.
“Moving from a single-product, became a familiar and valued part of the 1990s Thomas H. Hall, III
owner-run enterprise into a complex business advisory landscape. But with 1990s Paul R. Ray, Jr.
and large-scale national one is a increasing numbers of people entering 1990s John Lloyd
difficult task. First, you have to build the profession, some of the leading 1990s Eric Vautour
production facilities massive enough firms understood they would need to set 2000s Roger Stoy
to achieve the desired economies of themselves apart from the burgeoning
2000s Judith von Seldeneck
scale. Second, you have to invest in a field, and establish a standard for those
2000s Jean Van den Eynde
national marketing and distribution firms and consultants who would aspire
2000s Charles Wardell, III
effort to ensure that sales have a to join the elite ranks of best-in-class
2000s Vincent Swift
chance of matching that scaled- retained executive search firms.
2000s Anders H. Borg
up production. And third, you have
W. Carl Lovas
to hire, train, and trust people to 2010s
Harry O’Neill
administer your business. Those THE FOUNDING OF AESC 2010s
James Hertlein
people are called managers, and In the fall of 1958, several leaders of 2010s Jason Johnson
in the first half of the American the most prestigious executive search 2010s Aidan Kennedy
Century, they were in very short firms gathered to “take steps to raise 2010s Thomas Daniels
supply.” standards of the emerging professional 2010s Krista Walochik
From The Firm by Duff field of executive recruitment by 2019 Paul Benson
McDonald. Copyright © 2013 establishing a non-profit membership
Executive Talent - 5
The founding members include:
I n terms of quality standards, in our business it's all about trust. That's
what really matters.
- Russell S. Reynolds, Jr., Chairman, RSR Partners
• Ashton Dunn Associates
• Elmer H. Davis & Associates
• Antell & Wright
Joined AESC Board in 1968, representing William H. Clark Associates • Hoff, Canny, Bowen & Associates
• Richardson, Bellows, Henry & Co
• Ward Howell Associates (Later Signium)
ethical practitioners. The association would
• William H. Clark Associates
become a hallmark of quality and integrity.
• Wright Porter Inc.
According to the December 1959 AERC By-
Laws, the Objective of the Association Will Be:
The Association’s founding firms were
among the most respected names in the
1. To develop, maintain and enforce high
business and were quickly joined by young
standards of ethical professional practice
firms that have grown to be industry
and rigorous membership requirements,
leaders today. AESC’s President and CEO
which will make membership in the
Karen Greenbaum explains, “The leaders
Association a recognized mark of
on AERC’s early boards were pillars of
experience, stability, competence, and
the profession: Spence Stuart, Gardner
reliability.
Heidrick and Russ Reynolds were all on the
2. To develop and improve the practice of Board. Russ Reynolds was on the board
executive recruiting. representing William H. Clark Associates,
and again after he formed his own firm. By
3. To provide a fuller and wider understanding
1974, members included Boyden, Heidrick
of the function of executive recruiting in
& Struggles, Russell Reynolds, Korn Ferry,
our economy.
Ward Howell and many other leading
4. To gather and maintain factual information firms.
about executive recruiting firms. The standards, ethics and values
5. To establish and enforce a code of conduct embraced by these firms became the
and practice which will further the foundation of the association. William
objectives of the Association. H. Clark’s company subscribed to a code
THE EARLIEST LEADERS IN EXECUTIVE SEARCH WERE ALSO MEMBERS OF AESC
• Thorndike Deland is recognized as a • Gardner Heidrick and John Struggles,
pioneer, founding the first executive both Booz Allen & Hamilton alumni,
search firm in 1926. formed Heidrick and Struggles in 1953.
• Edmund F. Wright set up McKinsey & • William H. Clark left Morgan Guarantee
Company’s executive selection function Trust & Company to form William H.
in 1936, joined Handy Associates in 1952 Clark Associates.
and left to form Wright Porter in 1956.
• Spencer Stuart was a partner at Heidrick
• Several early consultants worked in and Struggles before forming his own
executive recruitment at McKinsey & firm in 1956.
Company before starting their own
• Russell Reynolds worked with William H.
firms, including John Hardy in 1944,
Clark until forming his own firm in 1969.
Ward Howell in 1951, and Canny Bowen
in 1954. • Lester Korn and Richard Ferry worked in
the executive recruitment department
• Sidney Boyden left his role at Booz
of the Peat Marwick Mitchell accounting
Allen & Hamilton to establish Boyden
firm and left to form Korn Ferry in 1969.
Associates in 1946.
6 - Executive Talent
of ethics that precluded competing In a 1974 general statement to the board
assignments, approaching an employee of of directors, AERC executive director
a client firm, and making false statements John F. Schluter expressed frustration at
for “research” purposes. In that same the inward focus of the Association and
vein, Russell Reynolds Associates stressed reiterated the urgency that the expanding
a highly collaborative “one firm” culture profession have an “elite group” that is
based on shared values. Each founding “immediately recognized as representing
director committed to “the highest the best qualified and most professional
standards of competence, objectivity, and firms in the business,” as well as the need
integrity” which informed the rigorous to “establish for once and for all a clear
selection criteria and the principles agreed mark of distinction that membership in
to by members. AERC hold for the industry.” At the same
One of the very first actions of the new time, the Association became active in
board was to ratify a Code of Ethics that thwarting potential legislation to lump
the founders had developed in advance of the growing profession with employment
the Association’s incorporation. The AESC agencies, which misunderstood the
Code of Professional Practice has evolved service provided by search firms, and
over time, and since the inception of the would impose unnecessary restrictions.
Association has served to elevate the In the years ahead, AERC concentrated
professional practice of executive search its efforts on maintaining and publicizing
as well as enhance the public perception the Association’s high standards and
of retained executive search and the developing its legislative influence to
Association. protect the profession from unnecessary
regulatory interference. Indeed, the
importance of clients, candidates,
GROWING INFLUENCE regulators and the general public being
“In 1967, William Clark asked me able to discern retained executive search
to serve on the long-range planning from other employment-related services
committee of the AERC with Spence has remained vitally important.
Stuart, Ward Howell, and Gardner Fueled in part by that urgency, in 1982
Heidrick. I then realized what an AERC changed its name. “Under the
outstanding group of people had auspices of President John Richmond, in
started the search business.” 1982 the organization voted to change its
- Russell S. Reynolds, Jr. name from the Association of Executive
Recruiting Consultants to the Association
In the 1960s and for much of the 1970s, of Executive Search Consultants. The
the AERC met the need for a networking new name would more accurately reflect
forum and peer group and helped the work undertaken by the search
members to define the profession. consultant, as distinct from the recruiting
Roger Kenny, 2001 recipient of the AESC undertaken by employment agencies.”
Lifetime Achievement Award, recalled,
“One night we invited Marvin Bower,
W
e know that leadership matters in every organization,
head of McKinsey, to speak to us, and he
and that our work impacts lives every single day.
got up and said, ‘Stop calling yourselves
consultants because you’re not For an executive search professional to be successful, they
consultants. There’s enough confusion have to have the total trust of everyone they come into contact with
about consulting as it is!’ Well, Ward during a client engagement. Knowing that there are ethical norms, quality
Howell, a big bear of a man, got up and standards, and a true sense of professionalism in the industry helps ensure
said, ‘Marvin, I beg to differ. We are not that trust exists.
only consultants, but we are consultants - Clarke Murphy, CEO, Russell Reynolds Associates
who have to live with the results of our AESC Member since 1972
actions.’”
attitudes amongst search professionals
T
here is now a more widespread recognition of our role in were echoed by an increasingly powerful
worldwide business, and how important leadership truly is. I think client commitment towards diversity
there has been a sea change in attitude about the search industry, hiring and management. Many client
and a validation that it is critical, if you want your business or organization firms stressed that a pro-active stance
to thrive, that you get leadership right—and that a great executive search towards diversity was essential to their
team can be the difference between mediocrity and exceptionalism. remaining competitive in today’s changing
- Judith M. von Seldeneck, Founder & Chair, Diversified Search marketplace.”
Joined AESC Board in 1989 The Task Force concluded that executive
search leadership on the diversity issue
may represent a major competitive
The early 1980s were an important advantage during the next decade and
time in executive search and for AESC. beyond. As Sheila Avrin McLean, then-
Several high-profile CEO engagements Executive Director of the AESC stated, “The
by Heidrick & Struggles’ and 1995 AESC study represents important benchmarking
Lifetime Achievement Award recipient for our member firms. There is a strong
Gerard Roche, including placing John Scully commitment to diversity within the
at Apple, and Stanley Gault at Goodyear, executive search profession.”
raised the visibility of the profession, and
the period saw a dramatic expansion in
executive search. GOING GLOBAL
According to a New York Times article The next decades saw continued expansion
about Gerard Roche, “CEOs Are His Nectar” in executive recruiting, especially cross-border
published in 1987, the demand for executive activity, which led AESC to establish the AESC
search services was “fed by the turmoil in European Council in 1996 and the Asia Pacific
executive ranks occasioned by the spate Council in 2004.
of corporate mergers and acquisitions. In a 2004 AESC statement Peter Felix, then-
According to James H. Kennedy, publisher president of AESC, said: “AESC acts as the official
of Executive Recruiter News, the nation's representative of the industry to legislative
executive search companies now number bodies, including the US Government and the
1,500, up from 1,000 in 1980, and earn fees European Commission. AESC will, in the same
of $2 billion a year, double the 1980 figure.” vein, represent executive search in countries of
In 1994 AESC’s Board of Directors the Asia Pacific region and, in particular, seek
convened a Special Task Force on Diversity to promote best practices in countries where
to identify ways by which member firms the profession is still relatively new.”
could further increase the diversity of their "The launch of the Asia Pacific Council
professional staffs. Finding that women and is the AESC’s next big step in creating a truly
minorities were under-represented at the global professional association, representing
partnership level in AESC firms, the report retained executive search consulting in all
suggested a growing awareness of and major markets around the world. This initiative
commitment to diversity throughout the builds upon the rebounding economic strength
search industry. of the Asia Pacific region and recognizes the
According to the Task Force’s 1994 crucial role that the search for senior executive
Diversity Study press release, “Changing talent will play in the region's future growth. It
T
echnology’s continued evolution and the impact of social media have
transformed our industry in ways that Sidney Boyden and the other founding
members could not have envisioned 60 years ago. I am proud of the role we
play in impacting the success of organizations through effective leadership.
- Trina Gordon, President and CEO, Boyden
AESC Member since 1973
8 - Executive Talent
O
ver the past 50-plus years, our profession has witnessed a dramatic increase in the pace and complexity of business —
and the importance of leadership. I’m immensely proud to be part of a profession that has such a deep and direct impact
on organizations and the lives of individual leaders. Given the stakes of our work, AESC provides a great forum for
reinforcing our shared interest in maintaining the highest professional standards in delivering the impact that our clients need.
- Ben Williams, CEO, Spencer Stuart
AESC Member since 1961
also confirms the growing reach of AESC as the knowledge and experience to lead bet-the-
worldwide voice for executive search and the company digital transformation.
promoter of best practices."
At the same time that AESC was establishing
the Asia Pacific Council, businesses worldwide OUR PROFESSION THEN AND NOW
were experiencing digital transformation. Edmund Wright, an original board
member of AESC, testified before the
• The World Wide Web became publicly Securities and Exchange Commission
accessible in 1991 and by 1999 almost in 1961, during which he described for
every country had a connection. the committee the purpose of retained
executive search:
• According to the World Bank, in 2000,
6.743% of the world’s population used
“The purpose of our business is to assist
the Internet. That figure rose to 45.794%
management in building the executive
in 2016.
pyramid soundly, striving for what I
• According to GSMA, the trade group call “capacity in depth.” We work with
representing mobile operators worldwide, management in developing its executive
there were five billion unique mobile program, often being called upon to
subscribers in 2017, representing two evaluate the capacity for management
thirds of the world’s population. of the firm’s existing executive staff,
then indicating to management where
In recognition of the expanding role of weaknesses have been found, and
member firms AESC embraced leadership cooperating with management in
consulting in its identity, and in 2014 bringing in executives with the capacities
changed the name of the organization to the to fill those weak spots; in short, to bring
Association of Executive Search and Leadership strength to all executive levels.”
Consultants.
By 2017, global executive search and “We act exclusively as consultants
leadership consulting revenues would grow to corporate management and are
to $14 billion. New industries, new functional responsible to the corporation. We
roles, a new generation of digital natives are always paid by our clients and not
entering the workplace and the digital by the executives we place.”
reshaping of traditional positions upended Edmund F. Wright,
business as we know it, and AESC members Chairman of the Board, Wright-Porter Inc.
were charged with helping clients meet a Testimony before the Securities and
growing demand for executives with the Exchange Commission, July 28, 1961
T
he relentless focus on quality and professional development that AESC drives is something that is more relevant now
than it ever has been. In the developed markets in North America, Europe and Australasia, AESC quality standards
are an essential factor in client discussions. In the developing markets of Latin America, Africa and Asia, the mark of
quality that being an AESC member firm brings, helps to elevate the whole profession.
- Alastair Paton, Chair, Signium (originally Ward Howell)
AESC Member since 1959
Executive Talent - 9
The core purpose of the executive terms of cultural assessment, candidate
search and leadership advisory profession assessment, assessment of leadership
is centered on helping corporate leaders capabilities and fit.”
assess, advise, and build their executive “Also, the roles themselves have
leadership capabilities. become much more complex,”
When search was in its infancy, Greenbaum adds. “Digital transformation
corporate leaders faced a period is driving a lot of change in terms of
of great change: developments in leadership roles and business strategies.
transportation were expanding markets, Additionally, the businesses our clients
advances in science and engineering are in has changed over time.”
were dramatically altering products Greenbaum explains, “There are a lot
and processes, and top executives with of new businesses, whole industries that
the skills and experience to build on never existed before. Even the definition
the opportunities of the moment were of the positions—a client might think
scarce and hard to find. they want to hire a CMO, but what kind of
Today, organizational leaders face CMO? That’s a much more complicated
similar challenges: disruption, rapidly issue as well—how is the role defined
evolving technology, shifting economic and how has it been redefined based on
forces, and fierce competition for the changes in strategy and technology?”
best talent in a world of accelerating For example, 20 years ago a client may
change. Much like the early years of the have needed an executive with functional
organization, today AESC member firms experience in the financial services
partner with their clients to address their sector. Today, that client may need an
most urgent business needs with future- executive with those qualifications
ready skills rooted in a commitment to as well as experience successfully
ethics and client service. establishing a mobile payment system.
Greenbaum says, “What has changed Today, clients are looking to search
is that our clients are more complicated, firms for counsel on a broader basis,
and we’ve become much more including assessing leadership teams,
sophisticated in terms of assessment: in advising boards on their effectiveness,
I
’m proud to be in an industry that truly changes people’s lives. Millions of profes-
sionals and countless companies have benefited from the impact and talents of this
profession. It’s also gratifying to see the evolution of our industry. It is no longer
enough to simply find companies their next executive. It’s all about finding out who
they are and how they fit into an organization and how that organization is able to
synchronize their strategy with their talent.
- Gary Burnison, CEO, Korn Ferry
AESC Member since 1972
10 - Executive TalentM
aintaining the highest standard of quality and integrity across our executive search and consulting
businesses is at the core of everything we do. More than ever, our clients are facing high-stakes challenges
in an uncertain world, and they trust us to advise them and develop their talent and leadership, in addition
to planning for future succession. As an industry, we must continue enhancing the standard of quality of our
profession and cultivate long-term relationships with business leaders.
- Krishnan Rajagopalan, President and CEO, Heidrick & Struggles
AESC Member since 1961
succession planning and culture shaping. began,” Greenbaum says. “We came from
The profession, just as the industries it management consulting and our clients
serves, now requires much more agility. recognize the value we can provide in
In a fast-paced, ever-shifting business not just finding the best talent, which
climate accelerated by technology, is critically important, but in a broader
we have to be at the forefront to best range of business issues related to top
serve our clients with expert advice and talent and the critical role it plays in
insights. driving business growth and success.”
“When we add this kind of leadership “We’ve expanded our business to
advising, it takes us back to where we reflect that client need,” she says. n
TRIBUTE TO GERARD ROCHE, 1931 - 2018
AESC CHAIR (1974-75); AESC LIFETIME ACHIEVEMENT AWARD RECIPIENT (1995)
F
or more than 50 years, Gerard Roche
brought his integrity and passion,
candor and wit to the service of
executive search. An icon among search
consultants, he led Heidrick & Struggles
both as a member of firm leadership and as
a mentor and role model. In “CEOs Are His
Nectar,” Nov 29, 1987, The New York Times
referred to Roche as “the Old Master, the
High Priest, the Grand Acquisitor, the King
of the Executive Headhunters.”
While publicly known for some of the
“The number one sin in the world is unfulfilled potential. most high-profile executive placements in
If you’ve got the ability to write a book, damn it write the decades of his career, we knew him as
a book. If you don’t have that fundamental potential an honest and hororable advisor, trusted
then you go and become a dentist or something. But and respected by clients and candidates
if you know you can write a book, or sing as well as alike. Roche was fascinated by people and
somebody else, or run a company as well as somebody loved to see them succeed. He will be best
else, let me help you by putting you in a situation that remembered by AESC for his commitment
will allow your background and your talent and nature to integrity and his principled leadership
and everything about it blossom and build and grow in executive search and everything he
and flower and take off. There’s no ending to what you touched. He will be missed.
can do.” n
Executive Talent - 11FERTILE
GROUND:
NATURE, NURTURE,
AND THE ENVIRONMENT
OF INNOVATION
W
e know that great innovations no badge of disgrace for your company What made the Chinese so innovative?
can be born in garages and failing, there is a wealthy outflow of “There’s always been a culture of
dorm rooms, and in corporate capital, you have access to lots of other academic orientation, intellectual
R&D programs, universities, labs and creative people who can inspire you. All pursuit and development. Confucianism
innovation hubs. And they emerge those things create this wonderful blend emphasized that.”
from cities famed for their creativity as that makes it possible to innovate here Dimitri Tsamados, a consultant with
well as places whose largest resource more frequently than maybe happens Eric Salmon & Partners in Singapore
is ingenuity fueled by need. Turning elsewhere.” explains, “The first civil service in
ideas, wherever they come from, into Linda Shore, Managing Partner for China implemented a system of exams,
new products, services, processes, Mexico at Odgers Berndtson says, “In following the Confucian tradition,
enterprises and even new industries Mexico we have a younger generation about 2,000 years ago. Education has
requires innovative leadership, strong not averse to risk, the education is getting been extremely important for a long
teams, and both technical and financial better, most of our good universities are time and all the administrators in
support. promoting entrepreneurship, we’ve got China were people who had studied,
We look at a handful of those factors government opportunities motivating and so everybody knows it’s important
from the perspective of advisors who them, and we also have companies, to receive a good education because
help early stage businesses make their traditional corporations and VCs willing that’s your way to succeed in life. When
way on the road to scale and success. to take a risk and invest in these startups. it’s been drilled in you for 2,000 years,
2018 saw several exits and valuations people take that seriously.”
in the hundreds of millions of dollars. Shore highlights the innovative
THE CULTURAL ENVIRONMENT That’s a first for Mexico. Entrepreneurs influence of necessity. “Emerging
The cultural environment can have a are now becoming angel investors and economies tend to have high creativity,
significant impact on whether a fledgling VCs. International investors, particularly and are less burdened with legacy and
endeavor takes off, and some places from China, are now looking to Mexico. infrastructure, which normally are a
seem to be especially hospitable to That’s the environment here.” deterrent to innovation. So, people
innovation and entrepreneurship. What A culture that values learning has a must solve complex problems with
are the some of the qualities that foster distinct advantage, according to Richard whatever tools they have available. I’ve
creativity? What attitudes and support Lin, Office Managing Director of Korn seen people in Mexico who cannot pay
systems can allow business to launch? Ferry’s Taiwan/Cross Straits Practice. for advanced software and have solved
Deborah Op den Kamp is a consultant “The Chinese are known, especially problems by creating highly complex
with Spencer Stuart in Silicon Valley. in antiquity and classical times, for spreadsheets that work better and are
“There are some wonderful things about invention, whether it’s the crossbow more adaptable.”
Silicon Valley that make it uniquely able or the wheelbarrow or the classic As an example of the innovative power
to create the level of innovation: there’s four point compass or paper,” he says. of necessity, the finalists for the African
12 - Executive TalentInnovation Prize for 2018 won with and go to locations with low-level taxes. necessary to scale up, and local, national,
projects that address pressing issues They are going to Ireland, to India, to and global events can impact the
including agriculture, the environment, China.” He says, “It’s not only large availability of resources and access to
health, sanitation, and connectivity. conglomerates. A mid-cap company, markets. As reported in The Economist,
For example, according to the African even a small company can put their R&D young, high growth companies are
Innovation Foundation press release, wherever they want.” emerging across the US in part because
“The Shiriki Hub is a Smart Solar Kiosk, By many accounts, the U.S. of the wider distribution of support.
powered by strong solar panels and Government’s investments in West “Access to risk capital for startups,
equipped with large capacity batteries, Coast research laboratories during including through crowdfunding, is no
Internet of things (IoT) sensors, and WWII, and subsequent programs that longer limited to the two coasts. Local
a custom designed router, offering encouraged venture capital investment, governments are increasingly supporting
device charging, virtual top-ups, and aided in the success of Silicon Valley as training schemes, accelerators and other
low-cost connectivity. Designed as a an innovation hub. bits of soft infrastructure that greatly
business-in-a-box and distributed on In Europe, according to The State of boost startups’ chances of success.”
a micro-franchise basis, this is an ideal European Tech Survey: 2017, “Europe (Gazelles in the heartland: American
solution for digital connectivity to rural as a whole demonstrates bullishness entrepreneurship is flourishing, if you
populations and temporal settlements about the future of its tech ecosystem.” know where to look. The Economist,
such as refugee camps.” However the continent is still facing a Sept. 30 2017)
As reported by Financial Times challenging period for innovation. In emerging markets, sometimes
entrepreneurs in South Africa created “The Science, Research and you’re on your own.
a remote pharmacy that works like Innovation Performance of the EU 2018” Tsamados explains, “An immature
an ATM, to help relieve some of the report indicates that while Europe is startup scene, you can’t turn to the
pressure on over-burdened health a leader in science and a “research previous generation and ask them ‘how
clinics and provide much-needed access powerhouse,” the region does poorly do you scale,’ because the previous
to lifesaving medicine. Patients have in realizing its innovation potential, generation of entrepreneurs did
access to pharmacists via a Skype- with low levels of venture capital, and products, they did industrial goods,
like interface, and the kiosk dispenses public R&D expenditures as a share they did banking, but technology-driven
medicine for several chronic conditions. of GDP remaining below 2010 levels. startups, ecommerce startups and the
Governments have an impact on In May 2018 the EU rolled out a plan like really only emerged in the last 20
a region’s ability to innovate, too. for regulation and financing to foster years, so we don’t have that sort of
According to Pierre Fouques du Parc, innovation in the region. experience and you’re not supported
Managing Partner for France at Boyden, The investor climate certainly the way you would be in the US.”
“If a country isn’t attractive tax-wise, a contributes to whether a new business “Even your investors, most of them
company is going to pull their engineers gets the resources and guidance are recent VCs so they haven’t seen
Executive Talent - 13a full cycle, very few of them have James Quincy, President and CEO of “What I think is the ongoing challenge
taken companies public, and they are The Coca-Cola Company said, “If we’re not for Silicon Valley is that this place is isolated
discovering, together with you, what it making mistakes, we’re not trying hard from the rest of the world in that we often
means to go from one market to multiple enough.” think that the rest of the world, or even the
markets, to go from one product to Company cultures that embrace risk, country, is just like it is here. That is simply
multiple product lines,” he says. failure, and experimentation innovate not the case,” Op den Kamp says.
more and get new products to market “One of the companies that is thinking
faster. Charlie Ang, founding President of very actively about what I call the middle
THE INSIDE STORY The Innovators Institute says, “In the past, of the country is Pandora, the music
A vibrant internal culture often failure meant that basically you had a big streaming service. Their biggest competitor
distinguishes the successful from the idea, it didn’t work, we wasted millions of is actually terrestrial radio, people listening
unsuccessful organization, so much so dollars and years. That was the old way to the actual radio. And so at Pandora they
that legacy companies invest heavily in of innovation.” He says, “The new way of focus very deeply on how do we reach
recreating startup culture in their own innovation is something very lean, with Americans who don’t live on a coast, how
businesses, and fostering qualities of agility, very little investment, and it means you we think about their musical tastes and
resilience, and experimentation. are touching the customer at every stage. habits and how we understand who they
“The scaleup and startup businesses Basically, any failure in an innovations space are,” she says. “They spend a lot of time
which have been successful—they are actually means a negative experiment. thinking about music for everyone.”
extremely agile and they are extremely A customer wants this or a customer Lin has a similar client experience. “When
fast,” Pierre Fouques du Parc says. “Agile does not want this. It is just a negative WeWork came into China, they insisted ‘we
because usually they have to change experiment. We are not overly invested in want to create a WeWork that is China,
their business model. The startups who it, it’s just testing; this time it’s positive, this that is for China.’ They asked us all these
succeed usually take ten years, and in ten time it’s negative. What happens is that questions about Chinese people, Chinese
years’ time, they basically have to reinvent you want to really increase your rate of culture and work habits, Chinese values
themselves a couple of times: reinvent the experimentation.” etc., and constantly asked us ‘if we did this,
offering and reengineer the product and Op den Kamp says, “Sometimes you how would the Chinese view it, how would
the business model. They are fast because hear that referred to as ‘minimum people perceive this, what’s next?’
time is their main constraint and their viable product;’ let’s get something Tsamados describes how some
main obstacle. Usually the startup and the quickly out the door as long as it mostly international players failed to understand
scaleup are always fighting against time, works so that we can get feedback on it emerging markets before trying to break
which is their worst enemy.” and improve it, rather than invent in a into them. “It took time for big international
Lin recognizes the importance of an vacuum. Those concepts are great, but players who were coming to emerging
internal culture comfortable with constant you can imagine not every executive in markets to really get the pay-on-delivery
reinvention, and the risk that entails. the world is wired that way. So our job culture. This is a feature that you see in
“Startups cannot pay lip service, they is to figure out people who are wired Russia, China, India, Iran, and Indonesia.
have to innovate, or they die. The startup for embracing a level of ambiguity and These are often low-trust environments,
companies we work with, they just tend to change and are not only comfortable so the idea that you’re going to give money
be much more adventurous. They are risk- with that, but embrace it. when you buy something before you
embracing, not afraid to make mistakes, Companies also need a culture of receive it, sometimes as long as a week
and they tend to be more calm in the face of openness and curiosity. They need to be before you receive the good, is not natural.”
setbacks; they see setbacks not as disasters able to step outside of their cultural comfort Companies that do step outside of
or anything catastrophic, but learning zone and both consider and understand themselves can achieve great success.
opportunities—they reflect upon it.” broader markets. Tsamados explains, “In the 90s and early
14 - Executive Talent2000s, Unilever and Johnson & Johnson communicate to external stakeholders, ideas) and they cannot allow hierarchy to
started coming up with single dose to investors, to future clients, to future dominate. Brainstorming should not be
products for emerging markets. That’s prospects.” And for an entrepreneur, it isn’t used to validate the boss’s ideas, but to
what has driven growth, because people simple. Sometimes, he says, “They need explore the best ideas.”
in those markets couldn’t really afford to communicate on something that does She says, “Many great ideas come from
to buy a whole tube of toothpaste or a not yet exist, so they communicate on the people who are working on the day to day
whole bottle of shampoo. With single-use, concept, they communicate on the future, and understand the problems that come
customers could buy the product for cents so they need to have very, very strong with it. Collaboration and teamwork are the
instead of dollars, and that was the only communication skills, especially if they key. It is very important not to ridicule ideas
way that you could actually start entering want to convince investors.” during any type of brainstorming sessions.”
the households of people who had never “They need to communicate a lot She says, “Good leaders are not only good
bought your product.” internally,” as well. Pierre Fouques du Parc listeners, but also good at extracting ideas
says, “A leader of a startup basically goes from less extroverted people.”
to bed every night and doesn’t know if Shore may be describing one quality of
INNOVATIVE LEADERSHIP he’s going to be able to pay the salaries a servant-leader. Lin says, “They tend to be
Building an innovation-friendly culture is next month. But he wakes up and he will more reflective, they tend to talk a little bit
often the result of good leadership. tell all his employees that they are going more about their failures rather than their
Lin sees great leaders “as having a vision, to be the number one in the world in one constant successes. I think those that talk
setting an agenda, creating a mission,” and or two years’ time. So, these leaders need about their failures and how they’re come
adds “it’s all about loving what you do, to be extremely resilient, and they need to out of it are perhaps stronger, faster, better.
creating that passion and energy. Those are communicate a really strong ambition to Or at least more learned. You tend to think
things that are intangible but can drive an their employees.” this person survives more business cycles,
organization to new heights.” Leaders who listen can inspire and more challenges.”
There is also a practical side to good capture fresh thinking from all over their Projecting empathy and humility
leadership. Pierre Fouques du Parc organizations. Shore warns, “When is a relatively recent development in
explains that effective leaders are also companies use brainstorming techniques organizational leadership. Ang describes
good communicators. “They need to they cannot shut ideas down (even bad leaders moving from what he calls
Thank you to 2019 Global Conference supporter, Boyden
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Performance is driven by the right leadership, and
Boyden discovers leaders that deliver.leadership 3.0 to leadership 4.0. He says, that are future facing tend to have an to find answers. If they are trying to make
“3.0 leaders are basically managers, but this attitude toward reinvention that enables decisions based on the new possibility,
is no longer enough. The 4.0 leaders, they them to imagine different scenarios. that means they are future ready. When
are innovators, they are futurists, they are For example, maybe I’ve always been a the future comes they will benefit from
technologists and they are transformers; hardware company and software was it, because they are riding on the right
they take their companies to the next level.” an afterthought, but now I’m going to curve. But there are some companies who
He explains, “What was good in the be a software company that licenses my are the fourth level—this this the highest
past is no longer good enough. Imagine software onto other people’s hardware level—that I call future leading. So, it’s a
a Steve Jobs or an Elon Musk. The Global because that’s the only way to continue to bit like Elon Musk; electric mobility will
500 companies, their top leaders need to survive. And I’m not going to cry over not happen with or without Tesla, he’s trying
have that caliber now—a kind of new set being a hardware company anymore, I’m to accelerate this future and be the one to
of capabilities now which are what typically going to embrace the change.” make it happen.”
inventors do, what innovators do. No longer Anticipating and embracing change is Perhaps an under-celebrated quality of
the the kind of leader who can just run a big essential to future-facing leadership. Lin a successful leader is the ability to build a
corporation and do it better. But someone explains, “Companies just have to continue good team.
who can reinvent a whole industry.” to look for what’s next. What’s going to be “There is an important quality in
Op den Kamp says, “I think some of the the next thing that consumers really want? successful entrepreneurs—that they are
best founders out there are students of the What do they really need? What are they very good at recruiting,” Pierre Fouques
universe, constantly reading and talking using their devices, their products, their du Parc says. “Hiring still remains the big
with other CEOs, understanding challenges services for?” success factor for a leader. Whether it is a
they faced in the past and really opening He says, “I see companies increasing the small company or a large company, hiring is
themselves up to new ideas and new ways rate of innovation all the time, it’s incredible. a key factor. Successful startups were very
of thinking. It’s a level of openness that I Software is popping up questions all the good at recruiting the right people, very
think creates real opportunity to pursue time: ‘do you have to send this or do you early. And that is a skill, that ability—when
new ideas that keep them from stagnating.” want to share this,’ anticipating your you are a good recruiter, when you recruit
And being open includes being needs before you even think of them. And the right people it’s a skill you can use in
completely open to imagining something a lot of it really is Big Data, collecting that any type of company, from any size.”
completely new. “Use the analogy of intelligence on a continuous basis.”
Uber,” Ang says. “If someone in the Are leaders and organizations prepared
transportation industry—before Uber for the future? Ang describes four levels of IT’S ALL ABOUT PEOPLE
came about—was thinking 'how can the future readiness. “The lowest level is called As Fouques du Parc suggests, an
cloud or how can mobile phones impact future-shock. Most organizations and innovative leader cannot capitalize on a
what I’m doing?' they would never have most leaders are at that level. And future good idea without the right people. Who
thought of Uber, because Uber is not one shock means that when this disruption are they, where are they, and how do
single technology. Uber is everyone having happens—it will be a shock—it’s too late startup and early-stage companies attract
a mobile phone, having access to GPS, to respond. Once they are aware of the and retain them?
having micropayments. Many technologies disruption threats to their business, or Shore talks about placing several
are combined together to allow Uber to their career, then they are one level up; innovative people into entrepreneurial
happen.” they are future anxious. And when they roles. “They came from very traditional
The combinational innovation Ang are future anxious that’s where there is the companies. They were paid good salaries,
describes represents what future-facing knowledge gap. 'Hey, something is going to but what moved them was the ability to
leaders can do. hit me but I don’t know how to respond.'" work in that free environment, to think, to
For Op den Kamp, “The companies “That anxiety is also a motivator for them create, where there are no barriers, there
16 - Executive Talentwere barely any hierarchies. They work as interesting, we see a number of Indonesian I preserve the culture that I’ve created, I
a group. They get a lot of money in stock startups or a number of Singaporean don’t want it to be diluted or changed in
grants. It’s like combining the best of the startups that will recruit their chief product any way.’ So how do you keep control of the
traditional world once they are a little more officer from Germany, they recruit the values and culture and how it permeates
corporate, without limiting their creative CMO from the US, they recruit their CTO the company? We think of culture as the
side.” very often from the US also because we unwritten rules of how an organization
Tsamados describes the need in some have too few of them in Asia Pacific.” operates, that’s what creates the kind of
countries to import talent. For example, he Because talent is critical, hiring fabric of a place."
says, “In Iran, a country of 80 million people, organizations may have to choose between You certainly can see instances where a
80% of online transactions happen on the compromising or leaving a position vacant. company culture does not hold together,
Digikala platform. There’s no point of hiring Pierre Fouques du Parc describes such a and it stands in the way of a company being
anybody locally because if they’re not situation. “For one search we are looking successful. Focusing on culture and the
working at Digikala, they’ve never worked for a CTO. We had been looking for months. values that your company is going to live by
on that scale of ecommerce. So companies The client was a company owned by a is also critical to success.”
like Digikala need to look outside of Iran venture capital firm, and the CEO was still Shore describes an early stage company
to people who have seen what will be not convinced by our candidates. We found funded by a Mexican VC firm, dealing with
the future for these companies. We rarely a couple of candidates but they refused. So, the competitive market for talent. “They
saw non-locals being hired by large local we kept searching, on and on because the were already at the stage where they
companies until only a few years ago. They client is so demanding and he’s not going to needed a chief technology officer, and the
know they need to pay to get top notch hire a candidate who does not match 100%. people they kept looking at didn’t have the
talent, and they will pay what is required, He preferred to have a vacancy rather than profile or experience. We found a candidate
because otherwise of course they can’t hiring a candidate who is not perfect.” in Guadalajara who was truly amazing, but
recruit.” Stakes are always high. Op den the company’s budget was very, very low,
“What we’ve seen over the past five Kamp says, “Often when CEO founders, so we helped set up the deal in such a way
years is a significant injection of foreigners particularly, talk about the challenges they that they could make up for the low salary
into local startups because we don’t have face in scaling their company, one thing with an LTI; stock grants equivalent to 4-5
the expertise in the region and that’s quite they’re trying to think about is ‘how do years’ salary.”
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