WorldCity Business Magazine

(7) CEO Roundtable - All About Talent

by WC

When you put five CEOs of fast growing companies around a table, it doesnt take long before the conversation focuses on the challenge of staffing finding the most qualified people to keep the company growing and succeeding.

At WORLDCITYS latest CEO Roundtable breakfast at The Biltmore Hotel, the issue dominated the discussion from start to finish. South Floridas cost of living was one concern. So, too, was the regions scarcity of hitech workers, the lack of company loyalty and leadership skills among younger workers, and the generation gap in the workplace culture, as well as some positive signs, too. Among them, that Latin America is producing more top-notch multinational executives.

Setting the tone for the discussion was Lorena Keough, who opened the Miami office of executive search firm Ken Clark International two years ago. The arrival of KCI in South Florida was a direct result of the burgeoning biotech community. KCI specializes in executive search for companies in high-tech industries life sciences, biomedical, pharmaceutical, medical devices. The arrival of Scripps, as well as Max Planck and the Torrey Pines Institute in South Florida has really placed the region in a new light, said Keough. Not surprisingly, Keough, who covers Florida and Latin Amerca, is enjoying the ride. We had an excellent year in 2007.

But around the table the mood wasnt so upbeat. There was a lot of grousing about staffing issues. Its all about talent, declared Karl Stumpf, who heads the regional operation of architecture and design firm RTKL. For us, its not hard to find mid-level talent, people with 10-12 years experience. The challenge is finding leadership people. John Poncy, CEO of Venali, a provider of Internet fax messaging solutions for global enterprises, expressed his frustration at the difficulty of finding qualified network engineers and, especially, financial people to staff his Coral Gables global headquarters and research center. I have been looking for a good CFO, a good comptroller. And Ive been trying to draw good people down here, but Miami is not exactly a Mecca for financial folks, said Poncy, a South Florida native.

Our experience is a little different, said Colin Campbell, a transplanted Canadian who runs Hostopia, a fast-growing Web services company, headquartered in Fort Lauderdale. For our business, in the Internet design arena, South Florida is one of the best places in the world to be. Everyone wants to come here, but very often the younger people or mid-level people just cant afford to live here. The cost-of-living concern was echoed by others. Last year, said Stumpf, We lost three mid-level people, who moved to Texas because they couldnt afford to buy homes here.

Another complaint, shared by Venali and Hostopia, was the dearth of software programmers. Hostopia has had to look elsewhere, to the Ukraine, to fill its needs. The company set up a facility in Nicolaya, a city of 600,000 that used to be a center for the Soviet Unions ship-building industry, where Hostopia now has 175 contract workers.

We pay, on average, $1,000 a month, in some cases for workers with PhDs, said Campbell. That compares to $8,000 – $10,000 a month for programmers in the U.S.. Recruiting in the Ukraine was also the answer for Venali, which had a subsidiary there until 2004. But it was closed last year after Venali managed to bring more than a dozen network engineers to the U.S. with H1B work visas. The ability that these people have at age 20 or 22 is incredible, said Poncy. The Ukraines educational system is highly geared toward technical proficiency and their graduates are far ahead of anyone coming out of U.S. schools.

Lorena Keough noted that the Ukraine was not the only talent pool being tapped by global companies. In recent years, I have seen several companies in the life sciences and hi-tech sectors set up R&D centers in Latin America (examples include Motorola, HP, Nortel, Intel), and thats because they have great talent in places like Sao Paulo and Guadalajara. I didnt see that happening 10 years ago.

Keough emphasized that Latin America is not only producing top-notch executives, but also multi-faceted executives who have experience running entire companies. Those professional tend to get exported to the U.S. or Europe because they are so effective as general managers.

Ruben Rotulo, regional head of Agilent Technologies, applauded the trend. Todays professionals are so narrowly focused because we hire people for specific tasks and with specific talents. The ability to do the generalist jobs, the horizontal tasks, is often missing, he said. Rotulo argued that companies need people with a holistic view of the business, executives who can cross over from accounting to IT to sales and provide a strategic vision for moving for the company forward.

Across the board, there was an acknowledgment that the South Florida workforce has a special mix of entrepreneurship, creativity and flair. There is a creativity here that you dont necessarily find in other paces, said Venalis John Poncy. But that creativity comes at a price. To be honest, theres also a laissez-faire attitude here that you dont see up North or out West. By that I mean
that the work ethic is not always what it should be. On a day-to-day basis, you have to push people and deadlines arent as tight as they should be.

Another common complaint was the lack of loyalty among younger workers, not a issue by any means restricted to South Florida. Most of the senior leadership in our firm has been here for 20-30 years. Some have only ever worked at RTKL, said Karl Stumpf, adding that those days of loyalty to one company are long gone. I grew up in a generation when company loyalty was an
entrenched value, said Rotulo, adding that to be employed by a multinational company, like HP or IBM, not only meant having job security; it was also a badge of pride. That kind of contract is no longer valid, said Rotulo, but the younger generation can hardly be blamed for that. Rather, explained Rotulo, the dynamic of the business world has changed as a result of outsourcing, exporting of jobs overseas and the technological revolution which has eliminated so many jobs. Still, Rotulo and others emphasized a generation gap, too, and different values shaping the attitudes of younger people to career and life goals.

The new generation is motivated by things that are totally different from what motivated us, said Rotulo, noting that he was married by 23 and had children by 25, while his kids are now close to 30 and still havent made similar commitments. As a result, he said, they have a different approach to their jobs.

The world has changed. said Poncy, noting that young people have been empowered by their computer literacy. Kids are coming out of high school today with more knowledge about computers than someone with a PhD had only 10 years ago. This creates a major challenge in the workforce, as those 20-something tech experts, said Poncy, are often earning $120,000 a year or more. The entitlement philosophy that these young people have is vastly different from someone working at GM and making $30,000, 15 years ago.

The entitlement attitude is not the only drawback. Lack of leadership skills is another. Leadership does not come with prodigies, said Poncy, noting that there a lot of young CEOs in charge of big companies these days, but some of them couldnt lead a march to the mens room.

Finally, the discussion centered on another universal issue that has affected everyones business and hiring requirements the increase of regulatory compliance issues. As a result of the increase in the regulatory environment in Latin America, we see more and more demand for regional regulatory managers, said Lorena Keough.A company that used to get by with a consultant now needs to hire a qualified, full-time individual. This need for more compliance is an added burden for companies doing business in the region.

John Poncy noted that this phenomenon was not limited to Latin America. His business faces similar issues in Germany and around the world. One thing is certain, said Poncy, You really do
need a top-notch legal team to stay on top of these things.