Working as a PE-backed company CHRO presents unique opportunities for HR leaders to grow versus traditional corporate roles. Leaders will need to be open, agile, and tap into their broad HR skills and expertise to excel in this environment.
Meet Pat. Pat is a Chief Human Resources Officer (CHRO) at a large company. With more than five thousand employees, true grassroots engagement often gets lost in the shuffle, and Pat dreams of actively influencing company initiatives and making lasting change. Yet overall, Pat feels under-utilized while carrying a wealth of expertise that yearns for space to create, evolve, and operate in a more entrepreneurial environment.
As an HR leader, connection is your strength, and if you also have a passion for driving company growth, the size and pace of change at your organization may affect your ability to contribute and impact overall success.
PE-backed Company CHRO
In enters an opportunity to work for a smaller team or as a PE-backed company CHRO. You’ve heard about all the exciting career opportunities available if you make the move—and for good reason. Private Equity (PE) firms invest in start-ups or buy private companies that have the potential for growth. From there, they work to build the company’s value through strategic initiatives.
Working on a smaller team presents unique opportunities for leaders to apply their knowledge and expertise in a fast-paced, high-impact environment. Agile, growth-minded companies provide unlimited potential for career growth versus traditional corporate roles. You’ll gain firsthand experience with all aspects of the business, from strategy to operations and talent acquisition, pushing you out of your comfort zone and accelerating your development as a leader.
To help you decide if a start-up, PE-backed, or smaller company is right for you, we’ve outlined the top 3 skills you need to succeed in this role.
1. Hard HR Skills and Competencies
Agile, growth-focused companies often have a smaller team, or even a department of one. This is why it’s imperative for HR leaders to tap their broader knowledge, HR skills, and experience to get things done. Leaders should be realistic about their strengths and leverage external support and resources when needed.
The top HR skills and competencies you’ll need as a PE-backed company CHRO include:
- Transformational change expertise
- Talent management experience
- Employee culture leadership
- Demonstrated track record
- Communication expertise
- Data & analytics focus
As the lead HR executive, you will need to uncover, develop, and enhance the current structure and operations to meet the evolving needs of the business. Thus, the best candidates have prior experience working in entrepreneurial environments. In addition, it is helpful for HR executives to have a background in working for large corporations because it provides a broad range of experience as smaller companies scale for growth.
2. Flexibility in HR Leadership
PE-backed firms need HR executives who can perform many roles simultaneously and adapt to a rapidly changing world. The greater the comfort level with ambiguity (which requires being flexible, adaptable, and open-minded), the more effective you will be. As business strategy shifts, a successful private equity-backed company CHRO can make sudden adjustments on the fly to pivot priorities. Changing direction and putting initiatives on hold is tough, but these challenges are inevitable.
As an HR leader, you must be a supportive confidante, coach, champion, advocate, and advisor. Your day may range from conflict resolution to recruiting new talent. CHROs at a smaller, high-growth companies often work with the board to develop retention and long-term incentive plans. Additionally, these leaders find themselves doing work they have never done or have not done in years. For these reasons and more, flexible HR leaders positively impact employee motivation and performance. With a high concentration of strategic, interpersonal, and tactical work, agile HR leaders excel in PE-backed organizations.
3. Collaborative HR Strategy
Every organization needs supportive leaders who listen, learn from others, and create a psychologically safe work culture. Collaboration is critical, especially in the high-growth environments in the PE space.
Collaboration leads to faster decision-making, more productivity, revenue growth, and a happier culture! However, collaboration only happens when leaders encourage and model it. A PE-backed company CHRO should be capable of building trust and facilitating decision-making.
Beyond HR Skills
While considering this move, it is also important to consider the organization’s structure. Some smaller organizations are (or were before acquisition) founder or family-led, which can pose unique challenges and opportunities. You will need to be a strong visionary and communicator to overcome the resistance of legacy executives and motivate a team to achieve a common goal. So, be sure to evaluate leadership style, structure, and organizational culture, as these strongly correlate with job satisfaction.
Altogether, it’s imperative to have a firm grasp on your expectations and what competencies you’ll need to sharpen if you want to land the role of PE-back company CHRO. What other HR skill sets and competencies have you identified as essential for working in high-growth organizations?