Thomas McLaughlin

Some of my most bone-headed (and insanely expensive) mistakes have been hiring fancy people from big Fortune 500 corporate gigs and putting them in charge of smaller companies. There’s a saying, “You can take the man out of IBM, but you can’t take the IBM out of the man.” These fancy corporate people sound great on paper. And they might even be superstars at their old job. But they are absolutely clueless about how to build a business on a smaller scale. They live a gilded life in the corporate world. Execution is often as easy as bringing in McKinsey or some internal strategy team, agreeing on the plan, then telling an army of employees with an unlimited budget to execute on it. They’ve rarely hired and fired people. (Or if they did, they just called HR and the person was disappeared with a fat severance check) They’ve almost never set someone’s comp. (Salary bands, again via HR) They didn’t build any of the company’s systems or culture. (They were handed them in a training book the first week they joined) They are usually specialists, who only understand their niche vertical. (VP Marketing knows nothing about finance, sales, operations, etc) They barely understand a P&L (They had an Amex Platinum that they charge to their heart’s content and the company’s financial statements are measured in BILLIONS. Dollars, or even tens of thousands of dollars, are just meaningless space credits to them. They’ve never had to care about money, burn rate, or opportunity cost) They love consultants. (Compensation and management consultants provide air cover when things go wrong and make fancy looking decks that make them look good with the CEO) They are a cog in a machine. A very, very big machine. And a very smart and impressive cog. There’s nothing wrong with being a cog, especially a well-heeled corporate cog. But they are a cog none the less. And a cog can’t build a machine. A cog can only exist within one. Hire one to run your company, and you will soon realize that they are an animal taken out of its natural habitat. A tiger in the arctic. Unsure of how to hunt or what to do, other than curl up in a ball and freeze to death.