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NAREIM DIALOGUES SPRING 2018 11 For both employers and employees, Pigeonholes represent risk. This article takes a look at Pigeonholes from both perspectives. THE EMPLOYER'S PERSPECTIVE The risk related to Pigeonholes for employers seems pretty straightforward. Your talented Role Playing employee seeks a Leadership Role, but you have a vested interest in keeping him/her in the existing pigeonhole. Perceiving this lack of opportunity, the employee leaves for a greater leadership role elsewhere or to learn a new set of skills (new Pigeonhole), adding to his/her portfolio of leadership-related experience. The first step in minimizing Pigeonhole risk is probably astute recruiting. Success in retaining valuable employees is about aligning your expectations and those of the recruit. For example, a client recently considered a talented, accomplished person for an investment role. In this case, though, the Venn diagram of our candidate's ambitions and the role's leadership opportunity in the near term had just a sliver of overlap. Our client moved on to consider candidates whose ambitions better fit the role they offered, and the candidate remains open to new opportunities, though happy in his current, somewhat specialized role. We all imagine that Pigeonhole risk is easier to manage in a large multinational, or a growing company like Google. The large, growing firm has the luxury of grooming future leaders by rotating its talented people from one assignment to the next. But, for the smaller firm, transitioning someone from one functional role, e.g., asset management, to another, e.g., acquisitions, can be difficult. The roles require different skills, as well as relationships in different networks to do a job effectively. That said, we see examples of employers creatively transitioning people from one specialty to another. One of our investment management clients lost an acquisition officer to a start-up. Though a retained search for a direct replacement was an option, our client chose an elegant alternative solution: moving a portfolio manager into the acquisitions role. Though this required some investment and ramp up time for all concerned, it enabled the employer to offer a talented individual an opportunity that would keep him engaged and possibly position him for future firm leadership. The kind of "replace-a-person" search that might have happened in the example above is often a search for a Role Player. The employer might be thinking narrowly – "solve the problem" – with bigger picture organizational design not in the calculus. Regardless of size, however, hiring firms need to think strategically, particularly in replacement situations. • Probably the easiest way to get started thinking strategically is to ask, "Are we doing the right search?" And, consider whether the problem you are trying to solve, or goal you seek, is fully articulated internally and to your search consultant. Do you have a strategic goal that is not explicit? Perhaps you do not fully understand the top priorities amongst your goals. Sometimes, a recruiter finds that an important goal only becomes clear well along in the process. This is okay – recruiting is a discovery process and one that typically is not linear. For example, a client recently interviewed four people for a Vice President role. The position description was specific and included many investment-related tasks. The post-interview discussion, though, revealed a key priority that had not been fully articulated. While the position description mentioned a desire for leadership skills, only after the interviews did we realize the importance of the firm's goal of "upping their game." This would require that the successful candidate have Role Player experience, as well as the Leadership skills to tackle real organizational change. • Especially in replacement searches, where the risk of thinking narrowly is greatest, organizational design – including growing future leaders – should be part of the calculus. Like our most astute candidates, the employer needs to be thinking long- term. Someone's departure can create an opportunity for those who remain to grow and develop, as well as, of course, for the leadership team to re-think who does what. THE EMPLOYEE'S PERSPECTIVE If you just love doing one thing – e.g., doing deals – and have no aspirations to manage teams or a firm, by all means stay as focused as a brain surgeon. But, if you aspire to lead a firm, continually broaden your skill set, or try new things, be careful that you don't become pigeonholed accidentally. In my own career, I made this mistake. After investment banking, where I found that crafting a financial solution and then making the case (the pitch) to the client was the most fun, I focused on client relations and capital raising (making the pitch). Little did I realize that a couple of jobs into this, I would be perceived narrowly as a capital raiser. As one of my recruiter friends put it, I could be considered a "plug-and-play" capital raiser, i.e., a narrowly focused expert, interchangeable with any other narrowly focused expert. For those aspiring to broader roles, here are some of the lessons in that experience to consider: 1. Think longitudinally. Consider your ultimate career goals (e.g., leadership, earning potential, balance, etc.). Consider not just job content or the near term. 2. Look at your business and understand how the CEO got to the top spot. Assuming you want a top spot, see if you can position yourself to pursue a similar track. In corporate America, the CEO typically comes from operations rather than from a functional role such as general counsel. In other words, the CEO comes from the realm of P&L responsibility and not a supporting function. The corollary in real estate investment management is that the CEO typically comes up through the investment ranks, mostly likely via acquisitions. ©iStock.com/SIphotography