Tuesday, April 14, 2009

Leadership lessons from private equity

So good news for my wedding registry - http://www.kpsfund.com/newsandpressreleases/press2009-03-26.asp
Michael Psaros, one of the co-founders of KPS Capital Partners spoke to my Leadership class last night on leadership and characteristics he recognizes in successful CEOs hired by his firm. He is an alum of Georgetown's business school of course - with a bachelor's degree. I understand why the student services office is always trying to inspire love from the MBAs because the new building was almost entirely funded by undergrad alumni of the business school, not MBA alums.
One of the key lessons from class last night was that in a turnaround situation chopping of the head seems to work. At least when the CEO is replaced by someone with the ability to effectively deal with a crisis situation. Experience in turn around doesn't seem to be a key element though according to Psaros. Though what mattered even less than turn-around experience was industry-specific experience. The biggest crash and burn situation from one of the CEOs put in by KPS was one that they hired based off of a headhunting firm's selection process! He said that the CEOs need to be active and are often focused on the organizational chart of the firm as a source of trouble. This fits nicely to what I learned in Leading Organizational Change about how the leader is the expert on aligning people and systems, not managing the details.

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