Great on Paper. Ready for the Job?

An executive says all the right things, references well and then fails to make the difficult decisions the investment thesis requires.

It’s an uncomfortable scenario for any investor. It also raises a question about the assessment: did we establish that this person could deliver the mandate, or did we hear what we wanted to hear?

That challenge ran through Assessing and Building High-Performance Management Teams, the panel I moderated at the PEI Operating Partners Forum New York last month.

Joining me were Joe April (Quad-C), Tracey Byrne (Apollo Global Management), Courtney Hagen (Littlejohn & Co.) and Matthew McConnell (OceanSound Partners).

The conversation got into the detail of how experienced investors assess leaders: how they use the time before close, what they look for in references, and how they distinguish someone who can talk about transformation from someone who’ll actually deliver it. It also explored the human side of those decisions. Someone may have the capability but no longer want the assignment. They may have served the business well, but be less suited to its next chapter. Those distinctions matter.

Six practical takeaways stood out from the panel’s discussion, from how to assess leaders before close to when to make a change:

1. Write the exam before meeting the student

Before assessing an executive, agree on what the business needs them to deliver over the next 24 months.

That means connecting the investment thesis to the value-creation plan, translating that plan into leadership requirements and building a deal-specific scorecard. Without that discipline, it’s easy for the assessment to become “Did I like them?” rather than “What evidence do I have that they can deliver the outcomes we’ve agreed matter?”

A structured assessment, whether supported by tools such as Hogan or other assessment tools, needs to be anchored to that scorecard. A generic definition of a strong executive won’t answer the question the investor is underwriting. And this work should start before ownership. Use the sign-to-close period aggressively to conduct a fuller assessment, test initial assumptions and investigate the questions that diligence hasn’t resolved.

The CFO can effectively be part of what the investor believes it’s buying. In a transformation-oriented investment, the Chief Transformation Officer may be central to the changes the asset has been acquired to deliver. Uncertainty in those seats deserves early attention.

2. Don’t lead executives toward the answer you want to hear

“Are you comfortable making difficult decisions?” practically supplies its own answer.

A more revealing starting point is: “Tell me about a time when you had to make an unpopular decision with incomplete information. Take me through exactly what happened.” Then keep drilling.

What was the situation? What did they personally own? What alternatives did they consider? When did they realize they needed to decide? How long did they take? Who disagreed?

The principle is straightforward: reconstruct what they actually did. A confident answer can conceal hesitation, avoided decisions or a much smaller personal contribution than the opening account suggests.

The same applies to results. Establish the three most important priorities in a previous role, then examine performance against them: starting point, target, personal accountability and actual outcome. That makes it harder to hide behind broad claims about growth, transformation or professionalization.

For senior leaders, probe how they got results through others too. Who was hardest to bring along? What resistance did they encounter? What happened when somebody wasn’t getting there?

3. Use references to find patterns, not just reassurance

The discussion distinguished between three sources of references:

• People reached through the fund’s network, recruiters and other trusted relationships.
• Traditional named references supplied by the executive.
• People proactively identified because they’ve worked with the executive, but weren’t supplied as references.

Candidate-selected references have a place, but the executive controls the selection. A wider set of perspectives helps test the account developed during interviews.

The purpose is to identify recurring patterns across different companies, situations and stakeholders. One enthusiastic reference shouldn’t settle the assessment. Neither should one negative account. The most useful questions often concern what happened under pressure.

Look for consistency across multiple data points. Pay attention when the evidence challenges the view you’ve already formed.

4. Beware the executive who copy-pastes the playbook

A successful CFO isn’t automatically the right CFO for the assignment ahead.

Optimizing a mature finance organization is different from rebuilding one. Running a function is different from preparing a business for exit. Inheriting strong talent is different from replacing key leaders.

The risk is an executive who’s been highly successful in one environment and copy-pastes the same approach into the next business. Assessment needs to establish whether they can recognize when their playbook no longer fits. What did they initially get wrong? How quickly did they recognize it? What did they change?

One particularly useful question is:

What’s something you did successfully at your last company that you deliberately wouldn’t do here?

That tests whether the executive can distinguish between principles and playbooks. It also makes them engage with this particular business, rather than recount previous successes.

5. Can they do it? Will they do it? Does their experience translate?

These are three separate questions, and each needs an answer.

Someone can have the capability and pattern recognition to deliver an assignment without wanting to do it again. Another transformation, another leadership rebuild or another role involving constant travel may no longer fit what they want from life.

That’s why motivation deserves more than a passing conversation about enthusiasm for the opportunity.

Understand what matters at this point in their career: scope, wealth creation, learning, autonomy, people or transformation. Then consider whether the actual job, not just the opportunity as presented, fits.

6. Don’t let coaching become a way to avoid a decision

Give incumbent executives the benefit of the doubt, but assess them quickly and decisively. Once a gap is clear, the question is whether it’s coachable or whether it fundamentally prevents the person from delivering the mandate.

“We’ll coach them” needs evidence behind it. How important is the gap to the scorecard? What suggests the executive can change? Can they do so within the time available?

Loyalty complicates that judgment, especially as hold periods lengthen. An executive may have been exactly right for one phase of ownership, while the next phase demands something materially different.

“Has this person been a good leader?” and “Are they still the right leader for the next chapter?” are different assessments.

Recognizing someone’s contribution and reassessing their fit for the next phase can happen together. Avoiding that conversation leaves both the business and the executive in uncertainty.

Closing perspective

The conversation was a reminder of how much discipline sits behind a sound leadership decision.

Define the assignment before assessing the person. Keep probing after the polished answer. Reference for patterns. Test whether previous success will translate and whether the executive wants the work ahead. Then follow through when the evidence points toward development, support or change.

My thanks to Joe, Tracey, Courtney and Matthew for a candid and practical discussion.