In my previous blog, I described management styles that help form strong teams. Effective people management is one of the building blocks of good business – without the right staff or the right management, a company with potential will never shine. It is the energy of committed staff that turn an ordinary business into an extraordinary one, with each one playing their part to the best of their abilities, doing all the things, seen and unseen, that make a business run like clockwork.
Over the last few years, I have had the pleasure of working with some of the fastest growing asset management and asset servicing businesses in the UK and Europe. I have seen how fundamental it is to get the right people in the right places. A few key people can genuinely turn things around, making extraordinary things happen to business.
Delivering for high performance companies:
Despite the slow growth of the fund industry, we are fortunate to have a number of fast-growing companies as clients. Culturally, we are similar and champion the same values.
As we mainly use search methods to find candidates, we actually focus on working with companies who are market-leading. We do this for 2 reasons:
- Firstly, we won’t headhunt a candidate for a job that would create a downward career move, so we need to be able to offer top jobs at the best companies.
- Secondly, when companies are growing quickly, they need the specialist support of firms like us more, because hiring decisions are more challenging, and the understanding required goes way beyond taking down a simple job spec. We build up a knowledge of their business that enables us to do far more than just simple ‘box ticking’ recruiting – thought and analysis that takes time and effort and goes way beyond a normal recruitment process.
My partner, who is a consultant, regularly tells me that what I am doing is in fact HR consulting work because of the depths I go to with clients and candidates, teasing out key drivers for hiring and operational issues. I develop an understanding of businesses that is very profound, and from there, I can problem-solve and make matches accurately tailored to our clients. Half the time the things I am looking for are not found on the job description at all.
I believe that working with a good recruitment partner should be like this. We have the capacity to support businesses in demanding periods of fast growth because we can manage out people problems through the injection of the right people at the right times. This is only possible when we really know the business well, and in order for this to happen, we focus on servicing clients who are loyal to us.
Human capital = capital:
It may seem unusual to some people to hear that there are still some fast growing asset management businesses out there, but there are. The most interesting thing about it, is that they all display very similar characteristics when it comes to their human capital. Just a coincidence? I don’t think so.
I believe these firms have got something right in the way that they go about their business which allows them to tap into the potential of their people, and that enables them to outperform the market – any market. Getting human capital decisions right is essential if you want your company to grow, as it is the people who are engaged and motivated that will help you to drive your company forwards, innovating and creating as they go. It is your people who will help you to weather the storm or bring your company into profit.
Although most companies will tell you on their homepage it is their staff that differentiate them from the next, the number of companies who really behave this way is very different. In all high performance businesses I know, they really do live and breathe this. I believe it is the positive energy that is created by managing business effectively that makes certain companies outshine others. Let me share with you more specifically, some examples of what I have seen:
My top human capital characteristics of high performance businesses:
1) High levels of respect and involvement from senior decision-makers:
High performance companies have, what I would say is, a higher than average level of respect and involvement from all levels of the organisation, among managers and staff, and between staff and external suppliers – people generally treat each other well. But it is the impact of the way that senior directors of the business actively get involved in the business that makes the biggest change.
I have noticed that senior members of staff, like the COO or the CEO will dip into whatever is the businesses biggest concern and use their knowledge and power to make it work when it counts. They are not ‘hands-off’ when it matters.
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2) Build strong supplier relationships:
They build strong relationships with their external suppliers, and, as above, they treat them as they would an internal colleague. They understand that it is a two-way street, a personal relationship, regardless of the fact that one of you is a client.
Your requests will be serviced last if your supplier feels disrespected, and on the other hand, that small favour you did for your supplier will get repaid to you in consistent service that is way above the norm. Always remember that everyone is someone’s service provider!
3) They create flat structures:
Heavy hierarchies tend to stifle new ideas and fresh-thought generation. Like it or not, once you have been in a business for upwards of 5 years, you don’t question how things are done anymore. Stay upwards of 10 years, and you’ve forgotten it can work another way.
So let the young guys speak up sometimes, and hear what they say. The strongest managers can hear out a new thought and consider it, even when it isn’t one of their own.
4) There isn’t a heavy blame culture:
This one is a tough one, but it is essential to the success of business to allow mistakes to happen sometimes, and not to let this get in the way of practicing good decision-making.
When there is a heavy blame culture, this can destroy decision-making confidence and therefore, growth. It is important not to undermine people who are generally doing a good job for the odd error, one that they can then learn from. Mistake, learn, move on, and forget about it! If you feel someone is making mistakes all the time, they are probably in the wrong job.
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5) They chose their teams carefully:
They don’t hire badly, they invest time and effort in finding the right people, and they leverage on relationships with good recruitment firms to help them cover more ground. When they hire they focus on both people skills and technical skills.
They aren’t looking for the perfect CV, they are looking for the right person, knowing that that person can develop. They hire people with potential rather than those that have the right CV, but who might not deliver. They spend time with their recruitment partners, internal and external. My clients know when it is me calling because most of them have my number saved and they call me directly to talk.
6) They chose quality over quantity in recruitment partners:
They get to know us really well, and they give us the commitment that enables us to give them the best service we can. When they reach out to us, they know we will have it covered. That is the peace of mind that can only come from a strong relationship. They take the time to explain in detail how their business works, what their culture is like, and what the history is. Once done, this process saves them time and money because we can be sure who would be a fit and who wouldn’t – and they don’t need to repeat themselves. Because of their commitment, we can invest our time in finding candidates who would never know about the firm otherwise.
7) They chose their suppliers carefully:
They chose their suppliers carefully, and they give chances to new suppliers if there appears to be a new market-leader. Companies don’t make it big for no reason, if there is a firm out there making waves, go and talk to them, see what the hype is about, you might be glad that you did. High performance firms are open to change if this might bring about more positive results, and they invest time to review this eventuality rather than staying with the status quo, which seems easier but might be making your life much harder than you realise.
8) They promote gender balance:
When I talk about gender balance, I actually mean that they try to attract and / or retain women of a certain ‘child-bearing’ age. They are not put off hiring them, because they are focussed on finding the best hire regardless of sex. This can sometimes double the chances of finding someone really excellent. They recognise the importance of gender balanced teams and how they function better. They support women in coming through the ranks, not dropping them at child-rearing age, after children are born. It is at this time that many women reach their professional peak – when they are actually of most value to the firm, knowing a huge amount about the clients and the products, and the best firms find a way of keeping their talent on-board.
9) They retain their best talent, and remunerate properly:
They recognise that their best people always have other opportunities, and they look after them. It is often the best people who are the most frustrated if things don’t work out, because invest the most. High performance businesses are full of managers who have found a way to maintain positive teams, even when the times are hard, keeping morale high. This is the main way good businesses have seen out the recession. Good management breeds a workforce who will go beyond their role. They have clear career paths and pay structures for their staff, and have a ‘open door’ culture.
10) They use people in the right roles:
They are able to identify people’s strengths and put them in roles that work with their core personality traits. This keeps the employees engaged because they can further improve their best skills – skills which are of equal benefit to the business given that they are exceptionally-strong, creating a positive and successful work environment.
You could argue that it is the other way around, fast growing companies create these people, this environment, and that creates these typical characteristics. You could say it is a question of whether the chicken or the egg came first. But I think that would be the easy way out.
In a world as demanding and fast-changing as ours, you probably wouldn’t want to take the risk. There is a huge opportunity to take this period in our history and learn from it. Look after your human capital, and you will see what happens to your capital. I think it’s a win-win situation.
Author: Rana Hein-Hartmann is Director EMEA of Funds Partnership, a specialist firm for mid-senior hires in Asset Management and Asset Servicing operating throughout Europe and Asia.