January 26, 2021 – The COVID-19 pandemic has had a major impact on every business sector, executive search included, costing organizations billions of dollars in lost revenue. For the executive recruiting industry, the world has changed drastically, and search consultants have had to adapt to a whole new way of conducting business. Yet that has not stopped any of them from moving forward and breaking new ground.
Dan Hawkins, CEO of Summit Leadership Partners, has identified a number of trends as he looks ahead to the new year. “I am not sure how or when the pandemic will subside, nor do I have a clear view on the impact of the new presidential administration,” he said. “I can report that most of our clients are doing well and are quite positive on the economic outlook for the year. Business is strong or recovering rapidly for the many, and merger and acquisition deal-making is extremely active.”
Here are some trends that Mr. Hawkins has seen unfolding – many of which could have an impact on organization performance in 2021:
Exodus of C-Level Talent
Hiring has picked up over the past several months and search firms are busy again, said Mr. Hawkins. “Many executives were unwilling to make a move in 2020 due to volatility in the market and loyalty to their organization during the pandemic,” he said. “Given a frothy equity market, business stabilization, and new job prospects, we can now expect to see many professionals ready to make the jump. Get ready to prepare those succession plans and develop your top talent.”
Dan Hawkins founded Summit Leadership Partners in 2014 to help growth-oriented companies and business leaders scale and improve performance. Since forming Summit, he has advised numerous boards, investors, CEOs, and senior leaders in a myriad of industries across the globe. Mr. Hawkins brings 25-plus years of experience as a chief human resources officer, global HR vice president, and other senior leadership roles with high performing global companies, including Asurion, Ingersoll Rand, MagneTek, and Hoechst Celanese.
“Many executives are seeing their wealth continue to grow, yet the pandemic is forcing them to rethink their careers and future,” Mr. Hawkins said. “I know numerous executives who have a five-year retirement horizon and have shortened it to the end of 2021/2022.” Another dynamic is that boards are placing more pressure on diverse pools for executive talent. “Top diverse talent will be sought by all and create domino effects everywhere,” he said.
Start-Up CEOs Must Become Scale-Up CEOs
Technology start-ups are receiving plenty of investment these days as COVID-19 has fueled the need for more remote transactions, analytics, and virtual business. Many tech founder CEOs are faced with the challenge of evolving how and where they manage their business to ensure faster scale. “This requires greater operating consistency, instilling a management cadence and surrounding themselves with top talent,” Mr. Hawkins said. “Founder CEOs must develop and focus their impact quicker than ever.”
“Our technology clients (and more specifically our health-tech clients) have received significant attention and capital as PE firms have lots of dry powder to deploy,” said Mr. Hawkins. “Many founders and first-time CEOs may have a board and larger teams to manage than expected. Founders are learning to be ‘professional CEOs’ on the fly and need help in developing the organization to scale as fast as the investors expect.”
Equity and Inclusion Becomes Embedded in the Leadership Equation
As a response to this past year’s racial and social injustices, most companies appropriately issued corporate statements and equity policies denouncing racism and discrimination. This year, CEOs and company leaders will be expected to do more. Systematic changes will happen to staffing, leadership training, team development and assessment. Inclusion will become not just an initiative but a leadership competency that managers must possess. How companies assess, develop, and expect leaders to promote will evolve fast in 2021, so organizations should be ready.
Companies Planning Big Comeback Post-Pandemic Crisis
As the global, interconnected business community confronts unprecedented challenges manifested by the COVID-19 pandemic, the interdependence of the world’s economies has never been more obvious or so uniformly tested.
“In the face of our collective battle to endure and overcome, there will rise up great strength of resolve, new innovations, and a shared effort to recover and reshape the way we operate and pursue continued growth and success,” said Dan Veitkus, CEO and managing partner of Corsica Partners, in a recent report. “This infallible truth must be acknowledged as a guidepost to all: Every organization will emerge from this COVID-19 crisis either stronger or notably weaker. The question that every leader, every organization, every individual must ask themselves is this: Which side of the balance do I intend to be counted on?”
“Assessing and developing leaders to be strategic, effective presenters, good coaches and financially competent is not new,” said Mr. Hawkins. “We must now evaluate a leader’s ability to lead inclusively and foster equity in their organization. We are now evaluating inclusion in hiring and succession decision making. This will be the norm in the future.”
Board Effectiveness Takes Center Stage
It is no secret that boards are resetting themselves with diverse talent. Boards will be infused with more women, minorities, and younger generational players. “This will have a profound impact on how the board operates, interacts with each other, and makes decisions,” said Mr. Hawkins. “Board effectiveness and group dynamics will be increasingly more important than ever before. Board chairs will be on the hook to only ensure they have the right players on the board but are working well together in the interests of shareholders. board evaluations used to be a nice-to-have will become a must-have.”
“Most public boards have an informal self-evaluation in place on the board’s preparedness for the future, effectiveness as a group, and alignment with the company’s strategic direction,” said Mr. Hawkins. “This must now be a formal process led by an external expert to ensure objectiveness and that positive change is sustained. Private boards may not be legally bound to this, but it is a best practice that should be adopted by all to ensure investors’ and key stakeholders’ interests are addressed.”
Summit Leadership Partners advises boards, investors, CEOs, and senior leaders on scaling business through talent and organization assessment, coaching, executive team effectiveness, leadership development and organization performance improvement. The firm has offices in Austin, Charlotte, Dallas, Denver, Nashville, New York, and San Francisco. “Probably 65 to 75 percent of our business is with private equity and venture capital investors,” said Mr. Hawkins.
In a recent episode of Hunt Scanlon Media’s “Talent Talks,” Mr. Hawkins discussed the ongoing challenges founder CEOs face after a private equity investment and offered some techniques to help them during this transition. Click here to listen to the full podcast!
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media