Intrapreneurs, Entrepreneurs in Residence, Tech& product leaders, Heads of Innovation — they’re all in demand from today’s corporate organisations in their attempts to achieve the Holy Grail that is ‘innovation’.
Through spending the last six years helping organisations like GSK, Tesco, and Unilever hire more ‘entrepreneurial’ thinking into their business, I’ve seen how they have best been able to make the match work for both sides as well as seeing why it matters that they try.
This article leans on my own experiences as well as a body of research including the books The Talent Delusion: Why Data, Not Intuition, Is The Key to Unlocking Human Potential by Tomas Chamorro-Premuzic and Work Rules by Laszlo Bock which describes Google’s history of building an organisation where entrepreneurial talent thrives.
Part 1 is focused on why hiring ‘Entrepreneurial Talent’ matters for corporates today and Part 2 provides a guide on working effectively with it.
Part 1 — Why it Matters
The War for Talent
‘Talent’ as a news-worthy topic has risen in our public consciousness lately, for the fact that in its supposed scarcity, lies a high demand.
But how much of a precious commodity truly is this Talent, and what are we referring to here?
Well, it’s no secret that in today’s world, a vast amount of power lies within the hands of a select group of people who are building products for the masses.
Silicon Valley Tech Giants like Google, Amazon, and Facebook receive so much scrutiny for the fact that, big as they are, they are small in size comparative to the power and influence they exert over the world.
Teams of people building products in these companies remain lean. If the goal of industrialisation was to grant groups of people no larger than ‘2 pizzas worth’ with the means of accessing global audiences, then we’ve achieved that end.
We’ve been living in a ‘War for Talent’ according to the professionals at McKinsey & Co for over ten years and this war has only been exacerbated by the dominance of digital. Services like Netflix, Uber, and Airbnb are so deeply ingrained in our daily routines, yet most of us are in the dark as to how these services actually work behind their shiny user interfaces.
The result? The skillsets of the few who do have the technical skills and experiences to understand them can command some serious dough in the market for jobs.
Worth their weight in gold it seems, are the people whose skillset renders them capable of starting the next big thing from scratch. Aka the entrepreneur.
Software is Eating The World
Investor and Entrepreneur Marc Andreessen famously told us in 2011 “Why Software Is Eating the World” and still today, established and traditional corporate organisations are slow to adapt to the new status quo. They know they need to be on the wave of the ‘next big thing’ or else risk joining the relics of businesses gone before us whose industries disrupted too fast to keep pace. RIP Blockbuster, Kodak, Nokia.
It is true that big businesses become the behemoths that they are precisely because they continue to innovate. By no means is this article intended to suggest otherwise. However, in order to keep the pace of the change in today’s world, some of the innovations of the past may no longer cut it. Companies of a certain size and scale need to face the fact that new products are being built faster and cheaper today than ever before — your biggest competitor may not even be on your radar yet.
Based on the desire to access the Holy Grail that is ‘innovation’ or the next wave of disruption, corporates have increasingly handed over departmental budgets to their central innovation teams in the attempt to outsource the legwork of good ideas. In addition, through working with external parties and suppliers, corporates can better serve themselves — recognising they won’t have all the best talent in their building.
Partnering with startups is a phenomenon corporates know can help them access the ideas and innovations they may lack internally. This kind of partnership is becoming more and more the norm but was less the case five years ago, when The Bakery launched. Our model services corporates’ need to innovate by providing access to the talent, technology and IP inherent within startups through external collaboration. We’ve helped companies like Unilever, BMW, HSBC, and AXA and we’re no longer the only ones facilitating this.
A partnership is one viable strategy available, but the need to hire such entrepreneurial individuals should still remain a priority for corporates. Yet in order to go about hiring and retaining this kind of talent, corporates need to adopt a different strategy to the traditional HR and recruitment methods of the past.
Knowing what is likely to disrupt your business or your entire industry requires thinking about the world in new ways. As such, it's unlikely that employees who have been with you for decades can see the bigger picture fully enough to spot the potential risks posed.
Hiring ‘entrepreneurs’ is really about hiring people who possess the skills that can help you. Whether inside or outside of an organisation, entrepreneurial people are creative, opportunistic, proactive and visionary.
This article suggests how corporates might better attract and assess the kind of high flying, big thinking, entrepreneurial talent into their businesses that they need, in order to stay ahead of the innovation curve.
Brain Drain — Where did all the talent go?
Corporates used to be the stomping ground of bright young graduates leaving Universities as they flocked without hesitation to established graduate schemes in blue-chip brands. Management consulting, accountancy and banking were the mainstays of any ambitious young professional worth their salt.
Today, however, things look a little different.
For corporates are told there is a dearth of talent remaining. Why? Many of the best and brightest entrepreneurial minds are out building their own thing and don’t want to be employed.
The volume of people seeking self-made wealth is on the up — thanks partly to the ongoing media obsession with startup celebrities and billionaire biographies.
I believe there is also a part being played by the rising individualistic sentiment in a society where the virtues of autonomy, creativity, and purpose are upheld more so than ever before. A career without purpose is the antithesis of the millennial dream whose inspirational quotes on ‘living life fully’ litter their Instagram feeds.
As such, the promise of the opportunities that life as an entrepreneur can appear to offer has inspired the masses.
Over 40% of people in the US are expected to have been self-employed at some point in their lives by 2020.
Thus, corporate organisations are suffering the pain that this self-employment revolution brings. However, it can be said that to a degree they are themselves at fault. There is a growing disconnect between ‘nonconformists’ in the workplace, and intolerant management structures without the means or structures with which to deal with consenting viewpoints. It’s this clash of interests and opinion that brings disputes and drives hordes of people away from the corporate world in pursuit of their own destiny. Many organisations are churning out top talent at speed through rigid and outdated approaches to management.
So what should they do about attracting, and keeping this talent?
Part 2 — A Guide To Spotting, Assessing, Nurturing & Retaining Entrepreneurial Talent
Spotting Entrepreneurial Talent
So assuming these corporate organisations want to seek out the kind of talent that can help their businesses to innovate and remain relevant in today’s world; what should they look for? What are the mindsets and skillset of these mythical ‘entrepreneurial corporate employees’ and how can organisations recognise these people when they see them?
There are some key signals worth looking out for when identifying such individuals, and ensuring that they’ll be suited to environments where they have to make significant business changes happen.
Look for those with ridiculously high standards for themselves. They generally tend to achieve more. A link can also be drawn between high-levels of curiosity and performance — the people who constantly ask why something needs to be done in a certain way will triumph over the ‘yes men’ as far as innovation is concerned. Curiosity is more important than specific domain knowledge — you want the person who will test the status quo to find better ways of doing business.
The dark horses
People who have raw talent which has just not yet been given a chance to blossom are worthy of further inspection. History reveals examples of the underdog: Albert Einstein was average at school, Churchill had poor grades and never made it to secondary school and JK Rowling was on income support before she found success with Harry Potter.
Avoid the naysayers
A big indication of having a low disposition towards entrepreneurialism is negativity. Studies have shown that negative people see fewer opportunities for change, activism or risk. Positivity, however (read: blind optimism) is the lifeblood of many entrepreneurs.
Look out for the extremes
Your hidden entrepreneurs who are capable of dreaming up the next big thing? They should possess an outstanding capacity for ‘maximum performance’. This is a state which kicks in during high stakes environments — the sort of environment in which startups are founded. People are only as talented as their personal best Chamorro-Premuzic has shown. Most corporate companies are able to subsist in a relatively secure and stable environment so only require predictable displays of ‘typical performance’ from their employees. For entrepreneurial activities to come to pass however, those with high maximum performance levels are your best bet.
The clever ones
A high IQ provides a strong correlation with talent. Despite a societal need for an encompassing and inclusive view of talent, the facts show a black and white picture when it comes to IQ. Clever people have a stronger likelihood of achieving great things and IQ is also relatively stable throughout an adult’s lifetime and cannot be developed further through coaching or training.
They make it look easy
We’ve been told by Malcolm Gladwell that you just need 10,000 hours of preparation to be brilliant. However, these hours are not weighted equally: untalented people will not achieve as much in the same period of time as talented people. Naturally skilled people can expend less effort and still achieve the same result.
PERFORMANCE = TALENT + EFFORT
TALENT = PERFORMANCE –EFFORT
AKA TALENT IS EFFORTLESS PERFORMANCE
Nature > nurture
Personality matching to roles is key here. One of the core tenants in scientifically grounded selection methods is to focus on placing people into environments where their personality is an asset, not a hindrance. In high-pressure environments, traits such as emotional stability can come in handy. So if you need to make a significant change in a ‘startup’ type environment, seek those whose disposition can handle high stakes environments.
Assessing Entrepreneurial Talent
When deciding who to bring into their businesses, corporates cannot simply rely on what people simply say about their entrepreneurial traits.
Inherent in peoples’ self-judgments will be biases and fabrications. Especially if you’ve indicated that you’re seeking certain characteristics, people will deliberately generate such image of themselves, known as ‘Impression Management’.
Instead, correct assessment requires a bit more science than is typically believed necessary. Whilst many interviewers happily rely on their gut decision to judge someone’s merits, the studies have shown these instant beliefs to rarely be accurate. It's true that many hiring managers grossly overestimate their ability to judge talent. The best test of performance uses work sample tests and structured interviews.
You should be asking questions of candidates where multiple versions of questions are used to arrive at answers, to seek consistency.
Questions should revolve around both their behaviour i.e. ‘tell me about a time when’ and situational i.e. ‘what would you do in x situation’. What have they actually built from scratch? What would they do in the face of adversity and people resistant to change?
You need to know precisely what it is that you are looking for, however. Get really specific about your needs in order to thin-slice particular traits in isolation of the bigger picture. Do this in order to avoid the general impression of someone as just generally ‘great’, and to force interviewers to identify exactly which attributes are ‘positive’.
Must they be capable of re-organising an entire business unit and therefore have resilience, stakeholder negotiation skills and operational excellence?
Or how about the blue sky thinking and vision that makes them capable of envisioning the next wave of consumer trends?
Must they be a natural mentoring teams of junior — but demanding — data scientists?
Whatever the criteria, it's crucial you get really specific. You want to get into the habit of creating a formula that is replicable, to continue to unearth the stars your business will need to thrive.
Nurturing Entrepreneurial Talent
Once you’ve decided that a candidate has the desirable entrepreneurial characteristics you want, next you need to pull out all of the stops to hire them.
It’s worth being aware that it could take longer than usual to hire this top talent when it comes to selling them on the prospect of joining your organisation. Remember that the people who are genuinely entrepreneurial have made waves for a reason — so they will also be on the radar of other employers as well as have dreams of building something independently. Do whatever what you can to secure them and get them over the line, and realise that once they are in the business, your effort needs to be focused upon providing them with an effective platform from which they can do their best work.
Talented people will always want to work in high freedom environments. The single most important factor for entrepreneurial people (who have vision and creativity to boot) is having the autonomy and level of decision-making in order to thrive, take risks and be rewarded accordingly.
Psychological research shows that the higher the freedom and challenge, the higher the intrinsic motivation. Ie. an ongoing interest in working for your company.
Corporates must recognise that many old school talent management practices which reward hitting short term financial or performance targets do not serve them when it comes to realising innovation agendas. The very nature of innovation is messy, risky, and requires placing many bets. Many of which will not pay off.
There will be people in your organisation who are happy doing the bare minimum required in a 9–5 schedule in order to hit their end of year bonus — these are likely loyal and trustworthy employees worth holding onto. But the people capable of spotting the next big market opportunity ahead of your competition? Assess them with a different lens entirely.
Short-term payoffs are not the name of the game in innovation. People need to feel trusted to take risks on behalf of your business and know that any resulting failure will be damage controlled accordingly.
Google has mastered the art of ‘rewarding failure’ — accepting that there will be many projects which do not hit the mark but the people behind them still deserve the same level of encouragement as the projects which succeed. They encourage aiming ridiculously high — so high that not hitting every goal is the only logical possibility.
To have a great idea, have a lot of them. — Thomas A. Edison
You cannot fit a square peg into a round hole: the people who might transform your business won’t necessarily fit into your existing management or HR practices so neatly. Companies should be able to adapt their longstanding rules in order to accommodate these kinds of individuals. The risk of not making exceptions to the rule is too high. Your business might depend on the breakthrough insights these people bring you — but if you don’t allow them to flourish you may never get to hear of them.
Another rule which may need to be thrown out the window?
It’s a touchy subject in an environment where the disparity between salaries across geographies, genders, and sectors looms large and is the source of much controversy.
However, to secure and then keep people who could be genuinely game-changing for your organisation requires an acknowledgment that rigid pay grades are not always fit for purpose.
Google has been open about ‘paying unfairly’, as they recognise that their top performers are at times worth exponentially more than others. They have shown how median and average performance levels are not equivalent when the gulf between the highest and lowest is so extreme.
In environments not restricted by physical limitations, it can be the case that the top 1% of employees produce 10x the output of the average. This concept is not exclusively found in performance but is a fundamental law observed in many areas of life — known as the Pareto Principle.
Ask yourself how many employees you would be willing to trade for this A- player? If the answer is more than 5 then you are likely not paying them enough money.
Essentially, paying your best performers in line with a pay grade that also incorporates the average, will inherently stunt the top performer’s level of progression. If employees find themselves unable to increase their salary in line with their true contribution, the result will be feeling undervalued and likely taking themselves to work elsewhere.
If however, you can make the exception that people whose contribution is exponentially greater get paid in accordance with the fact, then you will be better placed to keep them doing your best work.
Retaining Entrepreneurial Talent
Keeping your top talent engaged means meeting their needs. This is more than simply seeking ‘employee engagement’ which as a metric can be difficult to quantify. What actually props up people’s levels of engagement is providing them not just with what they want, but what they need.
Luckily there is some science to this, which shows that employers need to focus on providing affiliation; achievement and meaning.
For the purpose of this article’s focus on ‘entrepreneurial talent within corporates’ here’s my suggestions on meeting these needs in practice:
- Affiliation — aka belonging to the group.
Whilst you may think of these entrepreneurial people as outliers who are less likely to have common ground with the rest of your organisation, this won’t be the case in reality. People are always more similar than they are different at their core. Look out for points of reference they share with other members of your organisation. Being able to share similar interests or hobbies can help to bring people together and create feelings of affiliation. It might even be worth encouraging them to start their own groups or to share a skill they have which others could benefit from learning. Basically, don’t treat them like an outsider, or else risk them becoming one.
- Achievement — aka performing well in comparison to others.
Celebrate success and recognise when good work or change occurs, however small. You could assume change as inevitable given the role they’re in but never take it for granted. Coming up against the odds of a corporate machine with entrenched systems is no easy feat. Congratulate the wins and encourage any headway that people make. It’s a win-win because effective performance-related feedback has been shown to drive stronger engagement levels and so can act as a self-perpetuating cycle.
- Meaning — aka finding purpose in the work.
This might seem obvious, but the changes required must always fit clearly into a bigger picture. Google’s mission to “to organize the world’s information and make it universally accessible and useful” remains static for a reason: it’s a lofty and ambitious goal which by its nature can never be fully complete. Having goals like these will drive your ambitious talent to succeed and provide a solid framework upon which their hard work can rest. This mission might be one and the same as your entire organisations’, or something more specific to them. Either way, check that it energises them personally. If not, don’t expect this talent to stay with you for long.
Keep in mind that corporates do offer an amazing platform from which people can achieve incredible things. The scale, the distribution networks, the customers, the datasets… all of these assets would be unavailable to individuals on their own. Wear this badge with pride but never let it blind you as to the struggles that can also be inherent.
If you can get it right, then really high levels of engagement at work have been compared to an almost existential experience — where someone finds so much meaning and identity in their work they can become ‘as one’ with it. If you can provide this experience for people whilst also tapping into the power that exists internally, you can achieve great things for your business.
Conclusion: What does the future hold?
The future belongs to Entrepreneurial Talent — individuals capable of exploiting opportunities to drive innovation and keep pace with the technological changes society brings. It belongs to those in possession of a hungry mind: ‘learning animals’ addicted to filling in their knowledge gaps.
It’s these people who are more likely to seek out challenging situations, adapt and develop new skills despite increasing levels of automation in workplaces. They will continually carve themselves meaningful work and create value wherever they go.
Hiring truly entrepreneurial talent is not a quick or simple solution but it should be encouraged and attempted at every level. Corporates should make it their objective to become a great place to work for this talent by aligning incentives and laying the foundations upon which people can act like owners, not just employees. They should grant people with the remit to make important decisions, to create value and take responsibility for their own careers and have a tangible impact.
For corporate innovation at large; hiring entrepreneurial talent should be just one component of a wider engagement piece that also include partnering with startups through open innovation processes as well as starting new ventures — whatever it takes to bring the talent into your building that you don’t currently have access to, but who might move the needle for your business when it comes to innovation.
About the author
Ellen is experienced advising corporates on innovation, venture development, and talent acquisition. As the Head of Entrepreneurial Investment at the global open innovation accelerator The Bakery, she is focused on finding and investing in entrepreneurs to start new tech companies. Previously Ellen was a headhunter for digital & technology firms across the corporate and startup world and she also coaches women looking to make more of an impact in their careers.