EP 136: The roadmap to successful leadership recruitment in tech with Laura MacKinnon, Chief People Officer at Clari.

Join host James Mackey and his guest Laura MacKinnon, Chief People Officer at Clari as they share insights on defining leadership qualities for hiring, aligning strategies with market conditions, and driving cultural change in tech companies. Gain practical tips on setting criteria for executive hires, understanding long-term goals, and integrating acquisitions successfully. Discover the importance of courageous conversations and data-driven decision-making for growth and success in today's dynamic business landscape.

   0:34 Laura MacKinnon's background
   1:40 Keys to successful leadership hiring
   7:41 Market conditions' impact on executive hiring
18:56 Acquisition experience and cultivating winning behaviors

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Our host James Mackey

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Transcript

Speaker 1: 0:27

Hello, welcome to the Breakthrough Hiring Show. I'm your host, James Mackey. Today, we're joined by Laura McKinnon. Laura, thanks for joining me today.

Speaker 2: 0:34

Thank you, it's great to be here.

Speaker 1: 0:36

Yeah, great to have you. And before we jump into our topics that we've outlined, do you mind sharing a little bit about yourself with everybody here?

Speaker 2: 0:43

Sure, I've been in the HR function for well over 20 years now and have a passion for the people function, in particular, in high technology companies, primarily in software companies. So I've worked at companies like Yahoo, logitech, electronic Arts and most recently, I've really found my passion is working for SaaS companies. So SaaS technology companies, and currently I work at a company called Clary. Clary is based, if you can see, a company is based anywhere. We are a remote first company, but it's based in California and we have about 700 employees. We've been around for a little under 10 years now and what we do is we basically help companies consolidate their spend, simplify their sales tech stack and really get insight into their revenue using our platform. So right now, I'm really focusing on growing a company and making sure that we keep our really unique and special culture.

Speaker 1: 1:37

Love it. Yeah, I think a lot of people here tuning in have definitely heard of Clary, so excited to talk to you more about that and what you're building. For the first topic we outlined, we actually wanted to talk about leadership hiring. You've been at some of the most well known tech companies in the world and I'm sure you've done a lot of collaboration with other executive leaders to onboard some great executives and there's probably a lot of lessons learned when it comes to hiring great leaders and things you need to be aware of and to be successful, and then possibly some easy mistakes to make that you can help executives tuning in avoid. So I guess what I'd love to start with is maybe we could talk a little bit about how, when you're hiring executive leaders, can you talk to me about how you go about defining what type of leader you're looking for? How do you collaborate with the rest of the executive team and really dial in on the skill set and background that makes sense for the company at the time?

Speaker 2: 2:28

That's such a great question, and I think it starts with knowing where your company is at. So I've been at very large, mature companies that have been around for 30 plus years and sometimes that involves having a turnaround executive that you're trying to hire for, and most recently I've been at companies where your hiring executive helps the company grow.

Speaker 1: 2:46

So I think you're right.

Speaker 2: 2:47

First is knowing what kind of executive you're trying to look for, so you can be really clear when you're both out there looking for candidates as well as working. If you've got a search firm that you're working with, be really explicit about what stage your company is at. And it is a great question about falling in love with a resume, right. That does happen to all of us at times, and so one trick I've found that's been really helpful is sitting down with the hiring executive and executive team and getting on the table what are the top criterion and I found three to five is the most helpful that you're trying to search for. So usually it's only going to be about three. That can be non-negotiable, right, because everybody wants someone to be an A plus in about 20 categories. But you really have to distill that down to what's going to make this person successful in the role and what can we give on. So that's been helpful for me, so that we can get away from either taking too long because you're trying to find someone who's perfect for the role or maybe not being clear what you're looking for. So we've had some of the longest searches for executives. Where we've had the least amount of success until we did a reset was when the executive team so their peers had a different vision for what they were looking for. Out of that they're a new colleague than perhaps the hiring manager did.

Speaker 2: 4:02

And so I do find when you sit down and say here's some of the skills we're looking for or experiences which are frankly more important, and then you rank them, you can actually ask the exec team can you guys help rank this?

Speaker 2: 4:14

And maybe even some of their director ports, what do you think is the most important?

Speaker 2: 4:18

And if you have three to five of those, it really quickly shows a disconnect when the ranking order is very different. So, for example, if it's a CFO, someone might think having gone through, having taken a company, public is the most essential item, and other people might say it's their ability to be a great executive partner. So really getting those on the table is one thing I've found that's been helpful for us to move really fast. The second thing that we've really discovered in talking to our candidates is trying to be really clear what your company's purpose is. At Clary we've been talking quite a bit about this Understanding why you're at Clary, why you want to be here and that's been really helpful when we talk to candidates because we can explain what our purpose is and see if we've got a match, and sometimes that really helps highlight that we do have a great fit. Or at other times it highlights maybe why that perfect candidate on paper is not the one that you should be hiring.

Speaker 1: 5:11

Gotcha. So you had one of the things you mentioned was talking about are you looking for a turnaround leader versus a growth leader? You also said to be like very clear about expressing what stage the company's in. Are there any other kind of like high-level things that you need to define that are similar to that that you find like really important? Or those are solid three things. I'm just curious if there's anything else that's like super high level, like that.

Speaker 2: 5:34

Honestly, james, the most important thing I often find is asking the executive candidate what are you looking for out of your career? And when you're talking a C-level candidate, they're probably at the absolute apex of their career. But sometimes you might find that a CFO really wants to be a COO. You might find that a head of product wants to be a CEO. So, really understanding, is this their last and final position they want to be in, or is there some additional role? And then figuring out does my organization have the capability to give them that?

Speaker 2: 6:06

If they do, you're in great shape because you actually have one additional thing that you can use when selling and attracting that candidate. If you know that's very unlikely to be a role for them, you can avoid making a mistake from a hiring standpoint where you might have a very frustrated executive in a year. So really trying to extract from them what their trajectory is and that's, james, this is no different than any other. This could be the most a college hire to a C-level executive. It's not a rocket science question and it's not an unusual question, but I find it's really essential to unpack that versus say I know that you want to be our chief product officer. It's going the extra level to find out what else do they want and finding out if you can deliver that or not.

Speaker 1: 6:49

Yeah, I hear you on that, I agree. I think it's honestly quite interesting when you talk to folks about what they're looking to accomplish long term. Even if they're immediately interviewing for one type of role and then several years they want to interview they might be looking to progress to another type of role. It's interesting like I put a pull out on link about questions similar to the effect of like where do you want to be in five years or what's your kind of long term goal? It's interesting that majority of people really hate that question Like 66% and I always thought that was wild.

Speaker 1: 7:17

I never fully understood it because it's like of course, plans change and whatnot, but I feel, like a lot of the most successful folks that I know, they have a plan, they have a target, something that they're working toward Now. That's not to say that it might not change in a couple years and there might be an adjustment, but it would seem to me that successful executives are going to have a very clear path in terms of what they want to accomplish in the direction that they're going. It's hard to end up at a destination if you don't really have a plan or know where you're going right.

Speaker 2: 7:45

Yeah, I wondered if people hate that question because they were afraid that would maybe eliminate them from being Meaning. If I'm hired to be a finance analyst, I want you to be that finance analyst for 30 years and they're like I just don't want to lose this opportunity by trying to be too aspirational in my career.

Speaker 1: 8:01

I think so. I think that's probably like a big part of it, right, like just feeling uncomfortable or feeling like I don't want to be in this role forever, then maybe I'll be passed on. Yeah, it's just still an interesting insight, something that I didn't necessarily expect. But yeah, I did a poll and it was like the, I'd say, the majority. I think too, it's probably the type of role that somebody's interviewing for right, Maybe at like more of an entry level people feel a little more nervous to answer that question Honestly, then maybe at an executive level.

Speaker 1: 8:28

Yeah, that's true, yeah for sure. I think like one thing that's been that's come up quite often right now is Thinking about what type of executives companies need to hire when it comes to market conditions. So I've heard both perspectives. I've heard from some leaders that they're making an adjustment to the types of executives they onboard based on where the economy is right now, particularly in tech, it's gotten hit very hard, as we know, like a ton of layoffs and so I've heard from venture capitalists and some executives that they're looking for leaders that are maybe more of the turnaround type, or maybe a little bit more operational or financially savvy, that understand, like defining a path to profitability, these types of things, those types of skill sets, versus this kind of growth at all costs, skill set that maybe we were using a couple of years ago, in 2021, or in the bull market a couple years prior to that. So I think that's interesting, and but I've also heard that others like no, it's a long term game. It should be a consistent executive that's aligned with the long term mission of the company, and the one I have noticed, too, it's.

Speaker 1: 9:34

Maybe the difference is that the C's are looking at early stage companies are pivoting, adjusting, and they're focusing on the three, six, 12 months right in front of them. So maybe you dial in and change the executive profile and then, given the market and maybe for late stage, bigger companies, it's easier to focus on long term. I don't know, though. I haven't been in this position where I've had to hire executives from the perspective as an internal executive similar to yourself. So I'm just curious to get your thoughts Do market conditions impact the type of executive you hire, or do you try to see past market conditions and look five years out and hire somebody based on that?

Speaker 2: 10:13

That's such a great question, james, and it's something we thought a lot about. And you're right, it is absolutely situational to the business. There's definitely times when we want to grow only executive. But I think what I've found, both historically and most recently, were absolutely were looking for profitable, healthy, sustainable growth.

Speaker 2: 10:32

Having an executive who is not just someone who's only managed through the growth times is really helpful. It means that you've got someone who understands what it means to have a sustainable business that has a run rate that's fundable and we've definitely found it and I would say we're placing a higher value on those types of executives versus an executive who's only done a run up and to the right. It also means that executive is usually going to be a lot more comfortable. As you said, we go through cycles right. If we might be having a down cycle in the tech industry, it's going to come back up. So someone who is more calm, working, living through those cycles. I think there's a benefit to that because, as we're talking about executives, you're not just doing the job, but you're inspiring a team under you, and so having someone who is really comfortable saying I've seen this, I know how to manage through it, I've been through it twice, really. Not only gives the executive peers and the CEO confidence, but it also gives their staff confidence, and this too shall pass.

Speaker 1: 11:29

Yeah, I think that's incredibly important. I was speaking to CEO of a category leading SaaS company and he was basically and this was offline too, so I'm not going to share his name but basically he was talking about his product roadmap and he was talking about there's a lot of consolidation happening right now in companies tech stacks. They're trying to cut down and they're looking he said more for kind of a solution that can do everything versus these little segmented softwares that just add on. And one of the things that he's doing is he's actually they're changing basically their product roadmap to become an all in one solution, not only for SMB but mid-market and enterprise like really trying to bolster up their product solution because they don't want to churn customers that maybe would have been a fit for a couple years from now, but now might be considering churning because they're looking for an all in one solution to cut down on costs. So it's interesting and I was like asking.

Speaker 1: 12:26

I was like, but some people say that the tech market, hiring everything that might start to rebound in Q1. But he was like what if it doesn't? What if this is for the next year? Like I have to operate my business from the perspective that we could be in this market for the next year and I need to be prepared for that and again it's so hyper situational. But what I found interesting was just like really diving in and making like a pretty significant pivot to try to protect the business and thinking about the just the current market condition we're in versus thinking like no, we're doing really well overall over the past five years with this product offering. Let's stick to our guns and stick in that path. And so the parallel again to me was like with executive hiring, like how much do we look at what's right in front of us in the market and think about the uncertainty surrounding that versus do we just stick to what worked for us in the past and ride this out and stay consistent? So it's interesting.

Speaker 2: 13:20

That's a tough one and it's funny you bring up we did. We made the decision to be a platform Like you said, we're seeing a consolidation in the sales tech stack, as they call it about three years ago. It's not a decision you make lightly, and we've done three acquisitions since making that decision so that we can do a platform solution. So it's a huge investment and, boy, it definitely colored the kind of people we searched for when we hired for our head of engineering, for our head of product and now for our head of our CRO, our chief revenue officer, who just onboarded last week. So it's definitely a significant commitment, not one that I would want to change every year, because we're changing everything about how we operate, how we build products.

Speaker 2: 14:02

So very much a thoughtful and measured process. And you're right, if we had a company that was helmed by people who'd only done single app solutions, no matter how world-class they are, we would be in a world of hurt right now. So it does help matching up your executive hiring practices and profiles with your company strategy, and the earlier you can get those two in sync, the better. As I said, we started this journey three years ago and we've added those individuals carefully and thoughtfully over the past two and a half years and we would not be able to deliver on our promise to our customers and to our investments to be a revenue platform unless we had those individuals in seat.

Speaker 1: 14:42

So Clary acquired three companies. Three companies, yeah, yeah.

Speaker 2: 14:47

One product that is, and was, absolutely phenomenal. Right, it was this incredible solution. It got broader and broader and a really cool thing is and I've worked at several companies where this has happened if you have a great product, your customer will often come to you and say can I use you for more things? And so making sure you have a head of edge and a head of products who can think how do I create a platform that meets the customer's needs? So sometimes you are visionary. Do you need to do it? It sounds like the CEO is thinking, and sometimes your customers lead you there with saying we love your product so much, can you build everything for us?

Speaker 2: 15:22

Or in our case, we build and buy, we acquire and we build.

Speaker 1: 15:26

Yeah, I think that was really interesting and one of the benefits of moving toward this all in one solution is we was talking about from a pricing perspective, like he can for one type of solution or offering. He can actually lower it because he can offer it as a bundle and undercut competition at a better price point, because they're purchasing into the entire workflow, if you will, versus just a segment which I was like that's pretty damn cool. I can see that increasing your win rate for each individual product line as well.

Speaker 2: 15:56

We have a marketing genius who works with us, christopher Lockhand. I think is his podcast's category pirates and he talks about marketing categories. He often reminds us Microsoft used to sell individual applications and when they really got to the breakout point it was when they created the office, microsoft Office. So it's the same thing. I'm sure if you bought all five of those applications they would cost more than if you bought the entire office, but there's so many business reasons why that platform or office suite is more compelling for the business. So that's a good point.

Speaker 1: 16:28

Yeah, it also makes things stickier right, Like you're less likely to turn customers with additional functionality. So it makes sense, like why we're seeing this consolidation, and particularly amongst the craziness of the market over the past few years in tech, like the value ads of being able to offer more to customers. Being stickier, being able to come in hopefully at a more competitive price point due to a bundle, I just see and then also being yeah, again, just more generally speaking, resilient to different market conditions. It makes a lot of sense. It's really interesting.

Speaker 2: 16:58

That's why I like talking with executives about for you and a couple of other folks have talked with us about it's pretty interesting how business strategies is evolving and how people are thinking about it over the past few years, but if I were to tie it back to hiring, I think the very interesting thing about that is that what you just said about the selling, the stickiness, those are all things that people can figure out on their own, almost, as I call it, the caveman inventing a wheel or inventing fire, or you can hire someone who's actually been there and done that. So that is the really superpower of bringing in, and this isn't applicable just for executives, but bringing in at times and inserting this is what I'm passionate about is, in a high-growth company like a Clary, a Koopa, a SignalFX, a lot of SaaS startups I've worked for, inserting in experts who've seen these things enables you to also level up and grow your existing phenomenal talent that's grown up with you.

Speaker 2: 17:54

So it doesn't mean that you turn out your entire workforce and get a new workforce to eat. Let's say, in our example we're talking about Platform Ready. It just means that by inserting a few experts in who've been there, done that or we call it at Clary, seen the movie they can share this knowledge and they can then level up all the people around them. So you get the best of both. You get the brilliant people that helped create and start the company, or who've grown with you from an early stage, to add to that some outside expertise, and you just get this beautiful mix of experience and passion and incredible potential. And I think that's where Clary sort of, and many of the startups I've been at or, sorry, private companies I've been at really get on fire is when you get that right mix.

Speaker 1: 18:41

One question I wanted to ask you too, is around. You mentioned these acquisitions.

Speaker 2: 18:44

Yeah.

Speaker 1: 18:45

I see why executives are looking to do more of a bundle and offer more Companies are going in that direction, but that also seems also very challenging from integrating these different companies from, like, a people perspective and from a leadership perspective. Do you, when you look at hiring leaders, do you want people that have acquisition experience or have been through a merger and acquisition? Is that something that's really important for somebody that's maybe strong operationally to figure out how to combine the different companies? How much are you thinking about the idea of integrating these companies together in terms of an executive profile? I guess it probably depends on which hire it is, but you know.

Speaker 2: 19:23

We think nonstop about how to successfully integrate acquired companies. For sure it's the biggest investment and, as I mentioned, I've been at some very large companies and some very small companies and there's always the risk that an acquisition ends up being shelfware and that's usually when you figure out what happened. A lot of times is because the HR aspects of that acquisition haven't been attended too well. So you don't engage the workforce, you don't bring in the leadership team correctly, the business plan might not work correctly. I'm not sure that would be our number one or number two thing we're looking for. As you said, it's executive specific. It wouldn't be critical, and I find most seasoned executives have had at least a few experiences. We're super lucky and, for example, our head of engineering, where it's super essential that you get these groups to come together successfully on the tech side, or the potential is never realized. We hire somebody who specifically had that expertise, but we're also supplementing that with basically having a PMI.

Speaker 2: 20:21

We invested in a group that makes sure that we maximize the value of the acquisition that we've made. So that involves people that work on the people aspects, the product aspects, the financial aspects, even as things as small as the IT integration aspects. It's probably not our top priority, unless it's a very specific executive role, but I would find most C level executives have had some modicum of experience, either being acquired, themselves, acquiring or all of the above.

Speaker 1: 20:49

Yeah, yeah for sure, one of the most challenging things from my perspective would be as a leader.

Speaker 1: 20:56

Right now, it's over the past couple of years, potentially making significant shifts to strategy, which could be your product roadmap, it could be marketing positioning, it could be which roles you're going to be hiring for the skills such as you're going to be hiring for.

Speaker 1: 21:10

So everything that's okay. We change strategy and then everything that has to happen as a result of that. How do we think about incentivizing and rewarding, making sure that people are working on the right stuff, making sure that people understand the right point of impacts, then layer in potential layoffs, where you're doing team restructuring, then factoring in not only that, but we're going through acquisitions and just the amount of shifting that's been occurring for a lot of companies in tech right now. Taking that all into consideration really does seem like it's just so tough from a perspective of being a C level. It's just a very tough mental exercise being a C level executive and looking at okay, we're making these changes, we're making this acquisition, layoffs, restructuring and strategy, whatever it might be. How do we make sure that everybody's aligned and actually implementing the changes that we want to see happen?

Speaker 2: 21:59

Yeah, I always go back to the McKinsey 7S model and I'll have you to ensure I link with you. But it is really seven key things. Like you said, it's systems, it's a culture, it's the structure, it's the strategy. Again, that's a been there, done that thing. I learned that when I was my first 10 years at a company called Silicon Graphics from our head of OD and it's really stuff which is you can't just say how are we going to connect these two things together. You just take a mechanical let's say engineering approach how are we going to connect these two companies together? And you forget the software aspects and the business aspects and the inspirational aspects. You end up with potentially a failed acquisition, which is a huge loss of time and money. I always go back to something like that to figure out how to successfully navigate it and even then you're not guaranteed success. It's a lot of hard work, basically.

Speaker 1: 22:45

Yeah, definitely. So it's like a kind of final topic for today. I'd love to dial in more to culture. Yeah, and we talked on our prep call a little bit about driving winning behaviors.

Speaker 2: 22:54

Yes.

Speaker 1: 22:55

So I would love to hear from you more about what those I think we talked about. Self-accountability. I think you mentioned courageous conversations, being data-driven. I would love to learn more about what. When you think about building culture at Clary and some of the other organizations you worked for, how you think about that and how you think about really making it part of day-to-day operations and how people operate and do their job.

Speaker 2: 23:17

Yeah, and this is very much a change management effort. So I went through a very significant one at Yahoo and then also at Logitech, where those were older companies, highly successful, and they did have a desire change in how they wanted to operate and their strategy, and so we really stepped back and said culture and the people are such an important part of that. We did a lot of deep diagnosis with Yahoo. We used survey instruments to figure out what about the company was getting in the way of it getting to where they wanted to go, and what often happened was those are behavioral changes that needed to happen. So at Yahoo we had things like getting to a decision. It was a very highly matrix, large company. We are due different. There was basically decide a line and get on with it. That was a tagline that we used. That talked about how we made decisions. At Logitech, it was moving from a more conservative company to a design focus company, and so how do we change the culture there and make people really comfortable with risk taking?

Speaker 2: 24:15

At Clary, where I'm at right now, we were looking at we are going through hyper growth. We were probably 450 people. We knew we were going to acquire, we knew we were going to become a platform focus company. We had a lot of changes and we said what's going to get in the way of us growing and getting to where we want to go and what are the behaviors that we need to do differently to change? So for us, it was things like OK, we have so many priorities that at a successful startup like Clary there's so many things you can do. How do you pick what we're going to do?

Speaker 2: 24:46

So we came up with Relentless Self-Accountability, which is having people understand when you set a goal, you're going to sign up for that. But it also means you need to have a courageous conversation about what are my priorities? What am I not going to do? So we said that's probably going to be our biggest challenge is figuring out what we don't do, because there's so many choices, and really making sure, as we grow and we distribute management, have more self-managed teams. How do we make people more empowered to be accountable and really say hey, boss, I've got three things to do. This is the order I think I should be doing. Is this right?

Speaker 1: 25:18

So that was where we did the confluence of courageous conversations and Relentless Self-Accountability.

Speaker 2: 25:25

And then we also knew we were growing. And so there we said you know what? We're now a stage where being data-driven is more relevant. So, even on the people team side metrics, when you're 250 people, I can tell you why people are joining or why they've turned down an offer or why they're leaving. When you get to be 700 or 2,000, you actually need to do some analytics. So these are behaviors that we wanted to train, reinforce and reward people for demonstrating to support our growth, and that's what we've done. So we've done tons of employee enablement on this. We've done tons of recognition of what good looks like and we're feeling really good. This was a one-year change effort. We're coming up on month 10 of this effort and I couldn't be more thrilled at how our employees have embraced these things, because it's intuitively. It makes sense. They are looking at this and say, yeah, these are the things we need to do if we want to get to this next stage of our journey.

Speaker 1: 26:16

I love it. I would love to keep going in this conversation, but we are coming up on time here, so I think this is probably a good time to hit pause. And, laura, I would love to have you back on the show if you had fun today, but I just want to say thank you so much for joining us and sharing your expertise with everyone.

Speaker 2: 26:31

Thank you, James. You've given me some things to think about as well. I really appreciate it.

Speaker 1: 26:35

And for everybody tuning in, I just want to say thank you. We got some other great episodes coming out and actually a couple that have already been published, but if you haven't already, make sure to listen to the episode with Christian, ceo of Glassdoor. We also had Meet Yuran come on the show. He's the CEO of Tenable, publicly traded cybersecurity company, and we have new episodes that are going to be released with CEO of Gem, steve Bartell, and CEO of Greenhouse, daniel Chait. So make sure to continue to tune in and we'll talk to you next time, take care.