People who provide services — investment bankers, consultants, technology
firms, investment advisers, financial planners, physicians, lawyers, journalists —
are different than people who work at a product-oriented company. They need to be managed differently, too.
“The biggest difference is that in a services firm you are leading leaders,” says Bryan
I. Schwartz, partner and chairman of
Levenfeld Pearlstein LLC. “People in a
medical group, a university, investment
bankers, a law firm — all have roughly
equivalent educations, backgrounds and
opportunities. Your authority to lead them
is a function of their willingness to be led.
“Most successful professionals are interdependent, not independent. Those who
are independent will never be as successful
as those who work with and draw from
their peers.”
Smart Business talked to Schwartz
about using professional services workers
to guide business planning and organizational development.
How do you manage people at companies
that provide services?
The top-down, do-what-I-tell-you philosophy works on an assembly line. Your need to
have willing employees is less because they
are following a prescribed system. Not a lot
of people question authority in a top-down
organization. But in a partnership-style governing body, authority is more ambiguous.
Telling someone what to do is less important
than getting him to buy into the program.
The skills required to lead people who
are leaders in their own right is different
than that required to impose authority in
other settings. It’s all about the talent.
Talented people want to get to the next
level. Everyone, wherever they work,
needs to feel they have the right career
path, not merely a job. The service-firm
employee has more choices among
employers than the line person.
Where does a manager start?
It all begins with recruiting. We look for a
business-culture fit, technical ability and
leadership ability. Sometimes I spend four
hours on one interview. It’s a big investment, but if the hire does not work out, it
could cost us hundreds of thousands of
dollars and other problems that do not
appear on the bottom line.
We do a lot of psychological evaluation
— looking at who the person is as a human
being, more than the skills they bring to the
job. They need skills, of course, but chemistry is vitally important. In a service business, it’s all about energy. That energy can
be accelerated by hiring people who are
aligned with the firm’s focus … or it can be
sucked out by an energy vampire who is
not attuned to the company’s goals.
How do you know who fits?
I like to look at patterns of success, starting from childbirth. How were they raised?
What is their moral code? Why did they
choose a school? Did they play sports?
Sports are important. The marathon runner or golfer does not have the team
approach a football or soccer player has. It
is a generalization, but individually focused
people will never be as successful in a service-firm setting as the more gregarious team
player.
How do employees of services companies
differ from employees at manufacturing companies?
A manufacturer looks first for a person
who can help the business. A services company should first look for an individual who
is the right fit. The right fit is more important
than the ability to bring in money. If a service firm does not have the right platform, it
cannot obtain the right people and the business will not go anywhere.
Under top-down management, one’s career
is always subordinate to the company’s goals.
In a service firm, one’s career and the company’s goals must be aligned. Remember,
most top-level employees in a services firm
are looking for a career, not a job.
There are people who can bring in a lot of
money, but they create a cancer in the firm.
In a services firm, people are your widgets.
Your brand is your people. If you hire the
wrong kind of people, you send the wrong
message. Just like the weakest link in a
chain, the worst person in a services firm
sets your company’s image.
Is there a litmus test?
I like the old lunch-versus-sleep test.
Interview a candidate. Then decide: is this
person fun to lunch with? That is fine, but
not vital. Then ask, If I gave this person an
important task, could I go home and sleep
confidently that he or she will do the job
well? If the answer is ‘yes,’ it is that latter
person you want to hire.
BRYAN I. SCHWARTZ is a partner, firm chairman, and driving
force behind the creation and continued success of Levenfeld
Pearlstein LLC. Reach him at [email protected] or (312)
346-8380.