Talent Efficiency: Are Experienced CEOs Better?

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Talent Efficiency?is back! Many of you have reached out about this topic. And I'm learning a lot from you. I'll continue to post new threads on this subject, today focusing on the following question:

Are Experienced CEOs More Likely to be Talent Efficient?

It was hard not to notice that the?original article?on the subject of Talent Efficiency struck a chord with a number of experienced CEOs – second-time founders or founders who were later in their careers. A few examples:

[Multi-time founder] “Very nicely articulated. I was terrible at talent efficiency as a first time entrepreneur, and 10x better the second and third time around.”

[Second-time CEO] “Loved your latest post!!!! It’s funny because as I’ve evolved I’ve really embraced this concept [of talent efficiency] myself. I just don’t add much more value at greater than 50 hours a week and I subtract value in fact.”

[Experienced CEO] “Hell yeah. This is great!…I do *sometimes* have to work long hours. I am working late tonight and have for the past week as it is a very intense week-long period. In the early days I worked *a lot*. But I think the company goes through phases. What I've tried to learn is that in the periods where the business needs fewer hours from me, I should just embrace that and use it as an opportunity to exhale rather than feel guilty and try to find more to do. This is very hard for me, but I try to remind myself that I need to produce outcomes over the decade+ timeframe and I have to care for myself in order to make it there.”

Anthony Reynolds (on LinkedIn): “Spot on Allison Pickens. As a wise man once told me, ‘don’t mistake activity for progress’. At HireVue we give the team every second Friday afternoon off and as the CEO, I love it.”

Jason Lemkin (on LinkedIn): “Great post and a lot to reflect on here Allison”

Some of these comments, like the ones I mentioned in my last post on this subject, are about?individual?work patterns, as opposed to company ones – and I want to make clear that I'm focused on the latter, cumulative over time and aggregated across the organization, and relative to some output metric (e.g. ARR). At the same time, as I noted earlier, a CEO’s individual work pattern matters deeply to a company, because it sets a role model and cadence for the rest of the organization. Therefore, I do see these comments as relevant to a discussion about company Talent Efficiency.

So do experienced CEOs value Talent Efficiency more than less experienced CEOs? Even in the absence of a survey — which could be a fun project in the future — there might be reasons to believe this. First, experience may teach CEOs that Talent Efficiency can produce greater results, e.g. because they can attract stronger people with the promise of greater ROI for their time. Second, experienced CEOs often have families, and a desire to spend time with them (as well as perhaps an accompanying recognition that employees want to spend time with their own families) may be a powerful motivator to figure out how to be talent-efficient at the individual level. Third, experienced CEOs may value their time more than less experienced ones because, from a talent market standpoint, it?is?more valuable. They may not have patience for work (or overseeing others' work) that's unlikely to produce a large return.

In addition to possibly appreciating TE more, experienced CEOs may be more successful in driving it. Driving TE, like any metric, requires skill, and this skill can be developed over time. For example, I suspect that experienced CEOs on average have learned to select better business opportunities — i.e. they don't act on that silly idea for starting a company; they don't pursue that additional line of business that will be a time-sink.?

You could argue that experienced CEOs, besides possibly having greater skill, may be more likely to have networks, deep expertise, or other defensible, personal assets that in turn result in stronger fundamentals for the businesses they run. Consequently, their teams don't have to work as hard to produce strong results.?

Given these arguments, am I more bullish on experienced CEOs when it comes to Talent Efficiency? I’m definitely not ready to conclude that, and there are certainly arguments to the contrary. First, less experienced CEOs may be more likely to be authentic to a more avant-garde technology (e.g. Web3) or growth technique (e.g. PLG), and that authenticity creates a fundamental advantage for their company. Second, less experienced CEOs may value their personal lives more, even if they don't have families, causing them to value TE more. Although the following is a massive generalization, rumor has it that Gen Z and younger Millennials don't want to work as long hours as earlier generations.?I’m sure there are additional arguments in favor of less-experienced CEOs’ advantages in generating TE.

I think we could have a heated argument about whether experienced leadership results in greater Talent Efficiency. Let the debate begin!

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