Are you seizing the billion-dollar opportunity that’s right in front of you?Follow @PwC
Author: John Sviokla, head of Global thought leadership
Is your company struggling to create massive value? Are you in a highly competitive industry where finding the next great product is a daunting prospect? Then you may be interested in hearing how the pros do it.
To find out how the world’s most successful entrepreneurs created massive value, Mitch Cohen and I did a detailed analysis of 120 self-made billionaires and interviewed 16 of them, including Steve Case, T. Boone Pickens, and Mark Cuban. Our complete findings, and what you can learn from them, are in our new book, The Self-Made Billionaire Effect: How Extreme Producers Create Massive Value. But here’s a snapshot of what we discovered that surprised us.
What self-made billionaires do that the rest of us aren’t
There are distinct differences between what conventional executives around the world do to create value, and what self-made billionaires do.
In particular, we found that self-made billionaires practice five habits of mind that allow them to envision something new, bring together the people and the resources to create it, and sell it to customers who didn’t know they needed it. We call this kind of individual a ‘Producer,’ since their skills are similar to the way a Hollywood producer puts together the people and resources to make a movie.
Most executives, by contrast, tend to focus on optimising what already exists, whether it’s a product, a business model, or a market. These optimisers are what we call ‘Performers:’ they excel at improving the here and now, but they don’t cast their sights on customers’ future needs.
Most corporations encourage their Performers and discourage their Producers, which leaves Producers with breakthrough ideas little choice but to leave and pursue new opportunities on their own. The oil-and-gas billionaire T. Boone Pickens, for example, left Philips Petroleum out of frustration at the slow pace and traditional ways of his employer; and Dietrich Mateschitz left a long career in consumer packaged goods to launch Red Bull. By offering them few options to execute their ideas in-house, firms essentially push their Producer talent out the door—and their chance at the gold ring along with it.
In contrast, the companies that are seizing the billion-dollar opportunities have a Producer leading them. Our data on self-made billionaires even shows that more than half of them work together with a performer who has specialised skills that complement the Producer’s.
How CEOs are using talent strategies to create value
At the same time that Mitch and I were putting the finishing touches to the book, I began interviewing CEOs as part of PwC’s Annual Global CEO Survey, which will be launched on 20 January on the eve of the Annual Meeting for the World Economic Forum in Davos.
The survey results back up our billionaire research. Approximately 23% of CEOs globally ‘strongly agree’ that they look for a much broader range of skills when hiring than they did in the past. And 29% said the top reason for their business collaborations or alliances is to get access to talent and skills that are limited inside their organisation.
Collectively, these findings show that about one in four CEOs is interested in diversifying the talent mix in their organisation. As Jeff Gardner, former CEO of Windstream, noted, "We bought a cloud company and brought in a younger set of employees who made a huge difference. They think differently. Instead of making them fit in, we let them do their own thing. We certainly managed them, and put controls around that business, but, importantly, we didn’t do anything to destroy the secret sauce that they had." (18th Annual Global CEO Survey, PwC).
As CEOs look to diversify their ranks, they should make Producer-Performer pairs a key focus. In the years ahead, having people on board who complement each other will be critical to recognising the billion-dollar opportunities that are out there.
Are you using talent to drive value creation? If not, you need to take steps to identify, attract, and retain the people who can envision and execute the next billion-dollar idea. Your company’s potential depends on it.
Dr. John J. Sviokla is the head of Global Thought Leadership at PwC, where he also works with clients on strategy and innovation. In addition, John leads the Exchange - a think-tank that provides executives an opportunity to discuss important issues in a collaborative atmosphere.