Nothing Kills Faster Than Success

Kirk Dando started his career at Arthur Anderson, observing the success and obstacles to company growth, which led him to become an advisor to founders and CEOs, helping more than 8000 executives overcome the inevitable crises. He says that challenges to growth are common to all and can be predicted and managed. He has put his theories into a bestselling book, “Predictive Leadership.” Kirk Dando joins former SEC chairman Arthur Levitt to discuss his book  and how he has spent the last twenty plus years  helping over 8,000 leaders scale their businesses and themselves Host: Arthur Levitt Producer: Madena Parwana 

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:00):
This is a closer look with Arthur Levitt. Arthur Levitt
is a former chairman of the u S Securities and
Exchange Commission, a Bloomberg LP board member, a senior advisor
to the Promontory Financial Group, and a policy adviser to
Goldman Sachs. This is a closer look at Kirk Dando,

(00:21):
CEO of Dando Advisors, a leadership and growth expert whom
executive clients called the company whisper. He started his career
at Arthur Anderson observing the success and obstacles to company growth,
which led him to become an advisor to founders and CEOs,

(00:45):
helping more than eight thousand executives overcome the inevitable crisis.
He says that challenges to growth are common to all
and can be predicted and managed. He's put his theories
into a best selling book, Predictive Leadership. He joins me,

(01:06):
now for a closer look, Kirk. You start your book
with a very personal story about an event in your
childhood that drives you and influenced the work you do. Now,
could you tell us about this and the other influences
your work at Arthur Anderson? Yes, you bet um. That

(01:30):
event was the divorce of my parents. Um. I can
remember where I was sitting when they came in and
shared that story with me, and that that started a
series of events in my life and uh and a
lot of uncertainty unfortunately. And uh I remember being caught
off guard, like, um, not even understanding, you know, I

(01:50):
didn't even know that my parents were having problems and uh,
and then all of a sudden they were getting divorced.
So that started me on a series of discoveries around
really wanting to understand, like, well, don't I understand what's
going on around me? And I really took it upon
myself to really start to watch human behavior and watch

(02:13):
how people interacted with one another and watch, uh you know,
uh just kind of these these hopefully what I was
going to recognize, we're patterns of what, you know, how
success left left footprints, but also how fail your left footprints.
And so from that, UM, I took that into uh,
um having a little bit of uh, you know, if

(02:34):
you can't tell me I can't do something, then that's
probably the thing I'm gonna go do. So I went
to college and uh, and the only class I did
not get an A and was accounting, So I decided
to make that my major, and uh not not a
lot of hods of going on there, but from that
UM it worked out well. I ended up working at
Arthur Anderson. It was a great experience. Got to see

(02:55):
uh and be around a lot of very successful leaders
as well as leaders that that weren't successful and really
really struggled and really uh, as I said, started to
make a study of that. Out of that, I was
recruited to be the chief financial officer, ended up being
the chief operating officer for a company that we quickly
grew to a billion dollars and ended up selling. And

(03:16):
through that that those experiences I recognized. As I stepped
out of that, I had a chance to sit on
some boards and do some things. But rather than doing that,
I decided I wanted to come alongside other leaders like
myself that we're growing businesses but didn't maybe have a
mentor or a peer uh that can kind of help

(03:37):
them see around corners and and kind of predict the
problems before they showed up the results. And I did
started doing that about twenty two years ago, and I
got helpers high from from coming along these leaders, and
that's what I've been doing for the last twenty two years.
You're right that the first step in helping the company
is to determine where they are in the business growth cycle.

(03:59):
You talk about the three levels of the business cycle.
Could you briefly describe them so we know what we're
talking about. Yeah, So every business goes through a series
of developmental stages as it matures, and each stage begins
with steady growth and stability and consistently ends with some

(04:20):
level of turmoil. And so the first stage is what
I call that level one or that startup phase, where
really we're focused on really getting a product or service
developed and finding out that product market fit, perhaps having
to raise a little bit of money depending upon how
they're funding the growth. And it's you know, it's a
it's a nervous time, but it's also a very exciting time,

(04:41):
uh if. And we come to a first inflection point
where really two things have to be dealt with. We
have to start to understand that how we mature our
leadership and how we put systems and processes and that
can handle the way to growth if there's a good
market for our product or service. We move into what
I call rapid growth our level two company, and that's
where things really start to to eleerate and take off.
Then I talked about sometimes nothing kills faster than success,

(05:05):
and that's experience. Usually in this level two phase, because
we're having so much success and things are going so well, um,
it sets to mask some of the issues that maybe
need to be addressed that aren't getting addressed. But nonetheless
it's a very exciting time. And we come to this
next inflection point, which becomes a crisis. Um. And if
we don't deal with these issues, then we end up

(05:26):
usually going back and getting smaller. Other things start to
happen in the business. Kirk, You right that a big
problem is that the people you hire at the beginning
may not be able to take you to level two
or three. How common is this and how should a
CEO handle this? It's very common. As I have discussed

(05:48):
with literally thousands of CEOs, they say one of the
biggest regrets they have is that people that have helped
them be successful, that have scaled out, that they didn't
make a decision soon enough. So I'd say it's you know, happens.
It's probably one of the most common issues that holds
companies back from growth, and really how they have to
deal with that is they have to have you know,

(06:08):
an open and honest relationship with these people and have
those candid conversations along the way so they know that
how they're performing and UH, and also set the business
up to understand it. That's that's a part of success.
It's not favorable and it's not enjoyable, but it is
a part of success. How many companies make it to
level three and once there is there no level four.

(06:30):
It's a great restaurants. So there's you know, um about
ten percent and companies make it to a level three
if you look at the characteristics, and it's not because
you have to be super lucky or have absolute best
product or service. If you look at those at that
inflection point between two and three, dealing with those issues
is very very difficult UM. And so when you get

(06:50):
to level three, there is there is a level four,
but it's um But essentially it's just an extension of
those characteristics that you find in level three. And once again,
this is an approximation of what happens to a business.
This is not meant to be. Once you get to
level three, then everything is solved. Sometimes it's harder. It's
harder to get and stay there than it is to

(07:11):
get there. Now, how much should the future of the
general economy factor into the company's plan And can you
predict an economic crisis that may be coming? Well, obviously,
you know, uh, no one can absolutely with certain predict
these things. But there are patterns out there that we

(07:31):
can look at to see and understand and and absolutely
that should be part of of the plans of looking
at what's happening in the economy, as we look at
our cost structures, that we look at our hiring plans,
that we as we look at the strategy to scale.
Looking forward in that economy and drawing on experts that
are out there to help give us that guidances is
definitely one of the critical tools and any successful leaders toolbag.

(07:55):
New tech breakthroughs can make a business obsolete just about overnight.
Can you predict disruptions to your business model? Um? Once again,
I don't think that it's with absolute certainty that you
can predict those things, but I think you've got to
know what's going on in them. With the competition, I
think too many times we hold onto the things that
worked in the past so tightly that we miss h

(08:18):
the obviously that's in front of us. And oftentimes the
people that go out and create these disruptive companies were
inside of these companies that wouldn't move. They saw the opportunity,
they left and they started their own business. Uh and
they were pounding the drum and they were trying to
let everybody here, but no one would hear because because
you know, the old way or the old guard was
was so uh so revered that they missed the opportunity.

(08:41):
So sometimes it's just being aware and not just what's
going on, but also listening to the people inside your
business and what are they seeing on the landscape because
they're close to it. You talk about leadership, bottle knicks
is a problem for growing companies and organizational charts that
look like a rake. What's the bottle neck problem? So

(09:03):
the bottle of that problem is is where as organizations
grow and no one ever draws an organ structure this way,
but this is oftentimes how they're performing. It looks like
a rake. There's one person with a whole bunch of
people reporting into that person, and because of that, the
path of least resistance when it comes to solving problems
being creative, innovative, designing new strategies. The path of least

(09:24):
resistance is back to that one person's office, because in
order to manage that many people and lead that many people, UH,
it becomes where people are just on a need to
know basis. And so oftentimes people miss this great opportunity
to really step back and think about organ structure and
how it drives behavior, and if they don't, it creates
this bottleneck. Often as people think the bottleneck is because

(09:44):
there's too many leaders and there's not upward mobility, that's
not so much the issue as it is the organ
structure design and how it drives UM UH decision making
and tide and said the organization I really relate to
this next issue. When you write about UH fixing the
issue of too many meetings? Who had to one of

(10:06):
the biggest turnarounds in American retail You call it meeting
r O. I tell us about this. So one of
the things that I hear almost every time I go
inside of an organization and say, our communications don't work well.
Most communications happen inside of meetings. And I was working
with a very large retailer and we were doing leadership training,
and we got on this conversation about communications. We discussed

(10:29):
meetings in the very short order. What we did is
we figured out how much time they're spending and meetings
each year, just for the people in that room was
it was north of about twenty million dollars um and
and salary that was spent inside of internal meetings. They
graded their meetings that are about a five point five
out of ten, which is a feeling great in anybody's measurement.
And so they decided to start grading their meetings at

(10:51):
the end of their meetings house on what the criteria did.
It start on time and on time and good use
of time. And over the course of the year they
started having their goal was like meetings of point five
and I think they got into nines across the organization.
It didn't cost him anything, but they brought the focus
and attention to running really great meetings and this issue
around poor communications faded away and they had the biggest

(11:12):
financial turnaround they've had in history. It wasn't just because
of that, but they said because they were more focused
and got r I from their meetings um and by
simply grading, and it was a big impact. What a
great idea. Now, I advise a number of tech startups
as an advisor or board member, what warning sign should

(11:32):
I be looking for as a company grows? The book
talks about the specifically what I called twelve warning signs
of success UM and the most common UM warning signs
and and irony is that they are they are a
byproduct of earlier success. And so if you know one
or two of the most common ones as a board

(11:54):
member and uh and I just had a conversation with
Great camp One, who's the founder who was the founder
of red Box, and he said the most commun issues
he's ever had are around people, and that seems to
be a common theme with any CEO. So there's a
there's a one sign I called right idea, wrong person
where it speaks to, you know, we've got the right
idea of what we need to do to get accomplished,

(12:16):
but we just have the wrong person and we won't
we won't have the conversation or be real about what's
going on there. So that's the biggest one. So I
would tell anybody to really be looking out for what
are your views on boards? What can or should the
board be doing to plan ahead for possible crisis, and
what other advice do you have for choosing a board.

(12:40):
That's a great question. I think boards are such a
powerful and important part um the success of any organization.
And however, I think it's very critical that you know
how that board is selected in the individuals. I think
oftentimes it's because because of the capital that has been raised,
people board sheets um, and sometimes it's just not well

(13:03):
thought out. I think a lot of times the first
time the second time CEOs they select board parents or
board members and almost look at as like a parental
role where the board members is supposed to guide and
tell them. And I would always encourage CEOs and boards
to to really look and see how they become part
of the culture of the of that success. And so

(13:24):
I think the boards need to be more thoughtful about
really looking at the CEO as the leader of that team,
of that board, that team and drawing them into the
strategy of the business. But also they're there to represent
the investors and the other people that are have an
outside interest in the business, and so they have a

(13:45):
fiduciary responsible responsibility to make sure that the structure of
the board is such that that is occurring as well.
You've written about what you call the twelve warning signs
of success. One of them is a core values meltdown.
What is that? So oftentimes they'll see inside of businesses
where they start and they go to and they go

(14:06):
to a series of events to really come up with
what those values are, and they spend a lot of
time and effort um you know, sharing and communicating those
maybe getting imprinted on t shirts and hung around the office.
And then over a period of time, because of the desires,
the real desires of the business, whether it be profit
or some kind of some kind of success, or there's

(14:29):
maybe someone on the team that doesn't really live those
values but they're a top performer, where we start to
have looked the other way deals and that really does
start to compromise the values of the culture. And then
all of a sudden you see a meltdown. And I've
seen literally publicly traded companies taken down because of what
I call this um, this meltdown that happens inside the culture.

(14:51):
You have ideas on how to build a great hiring process,
including asking for presentations from potential hires. Tell us a
little bit about this, ya. So oftentimes is we get
down to the final candidate, all of them can essentially
do the job, but what we really want to figure
out is how passionate are they about doing this job.

(15:13):
So I encourage the organizations that I work with to
do a couple of things. One is really put them
into a kind of a role place. So if they're
in sales, have them come in and present like they're
selling to one of your customers. If it's same engineering,
maybe have them do a coding problem or whatever. But
have them come in front of the right team, the
appropriate people, and do some form of a presentation. If

(15:35):
it's if it's a sea level executive, usually it's a
ninety day plan. But through that you can see how
much time did it take them to get prepared to
they talk to the people that were going to be
their future teammates. Uh, you know, if you allowed them,
did they talk to customers? How how did they think
on their feet, how did they behave You're going to
get some insights so you wouldn't otherwise get just a
normal interview process. And so that's that presentation process. The

(15:56):
other one is called unanimity hiring. Um. You know how
people cross sections across the organization that have to literally
sign something saying I approve of hiring this person, or
I approve of of of promoting these people. And people
may say, wait, I'm hiring this person in marketing? Do
I really have to do this? If I'm in I
T But what it does is it creates cross collaboration,

(16:17):
and no one ever argues that it takes the right
person to get the job done. So going to say
extra effort has proven to be very valuable. That's a
great idea. Another startups ceo I talked to said he
fills his office with entrepreneurs. Is that a good way
to hire people? I think it depends upon where you're

(16:38):
at in your growth trajectory. I think a good way
to hire people is to get very clear about what
we need in the role, Remove any personalities or people
that are currently there, and say, one year from now,
if this person was wildly successful, what would have been accomplished?
What are the must versus the wants of this position?
How do we expect this person to come into our
organization and get results? Really go deep and and think

(17:02):
about the behavioral aspects, because oftentimes we hire people for
their skills and their past experiences, and we let them
go for their behaviors. So I think it rather than
saying these entrepreneurs, which suggests the behavior like it's better
to get clear about your work structure and then and
then really do a great job at defining the roles
and then hiring towards that. When people hire don't work out,

(17:23):
you say that of the time it's not because of competence,
but the personality doesn't fit. Is there any way of
predicting that? So there's there's some ways to be able
to to de risk it a little bit. One is
the presentation that we just talked about. Another one is
is getting this unanimity hiring where everyone's signing off because

(17:44):
everyone's having to put their fingerprints on that. Another one
is using the behavioral profiles. There's you know, there's Myers Braves,
there's this, there's all kinds of them out there that
kind of help us give some insight into somebody's behavioral tendencies.
And and and then the other one is I think
just doing really good punch checks. I think oftentimes we
think we don't do reference checks because we're just gonna
hear good things. But I think a lot of times

(18:04):
you can find about how someone performs under pressure by
doing those reference checks. Kirk, you say that there are
only three kinds of leaders, leaders that are for you,
against you, or for themselves. Do you have some examples
of these styles? Yes, so this is uh, thank you,

(18:29):
this is a wonderful question. Um. You know, experiences taught
me that leaders that are for you are people who
care more about what they can put into than what
they can take out. And not that they're weak, and
not that they don't hold you accountable, but they truly
um care about your improvement. There's leaders that against you.
Those are pretty rare that you know, but they truly

(18:50):
get some satisfaction out of really seeing you struggle and
and hurting you at some some time that you might
remind them of someone that hurt them when they were
a little something. What's more common as leaders that are
for themselves, And with all the um um information out
there about how to be a good leader and manager,
people can perform pretty well. But under pressure, you see

(19:12):
this person's real agenda come out and make care more
about what they can take out of you than what
they can put into you. And you can think organizations
that have for you leaders attract more for you leaders.
And consistently I've seen world organizations that that that have
these kind of leaders and they're rare outperform the other
kind of leaders that seem to be more for themselves.
What do you do with a leader like Elon Musk?

(19:33):
He's a visionary, the genius and the energy, driving and forward,
but in no way does he have inspirational leadership qualities?
How do you rate Elon Musk who is a great inventor,
is a visionary, but his leadership skills seem to be wanting.

(19:55):
So I think leadership skills UM leadership is, in my estimation,
is the ability to influence somebody and take them or
they can't take themselves. And so in a lot of ways,
I think Ellen does have that ability to those leadership abilities.
Do I think he would make a great UM coach,
you know inside of the locker room at halftime, inspiring

(20:17):
and motivating people. Perhaps not, but in his own right,
in the way that he's done, it's undeniable and he's lad,
you know, in a lot of ways, uh and had
a lot of breakthroughs. But as far as when it
comes to maybe leading people in an inspirational way, that
may not be his gifting, But no doubt Ellen has
a lot of gifts that have allowed him to lead well.

(20:40):
Whether he's a for you against your for himself leader,
I don't know him well enough to to make that call.
Bob Pittman, who founded MTV and a O L, said
that brands win. Do you think that's true once a
brand is established. For example, a brand like Uber was
not destroyed by it's very public leadership issues. I think

(21:03):
that the brands win to the extent that the leadership
is right. I think brands can win for a season
of time, but if the leadership does not get right,
the brand will not win. And we can look at
examples like Enron to prove that out. They won for
a long time on the brand, but at some point

(21:26):
the leadership um ultimate. Who was the demise of that.
I think that that's true. I think there's nothing that
creates health, wealth and happiness more than a leader, and
that's I don't think the brand out help strips that.
Do you think that managers and leaders are are born
or are made? That's a great question. I think that

(21:46):
that that both. I think that there's a small percentage
people that are just born with the natural ability to
to lead, to inspire, to assess risk, well and to
really gather people and drive in the direction. I think
a large part of people that aren't born with that
have the ability to become that. But it's one of

(22:07):
the toughest transitions in anybody's career, either going from doing
the work to leading or going from being an entrepreneur
to an executive, and many people don't dedicate themselves to
that transition. They just want what they want. But I
think that they're both made and born. Is there a
well known company out there that you would love to

(22:27):
get your hands on and change before it implodes. Well,
when Uber was going through all their stuff, I did.
I did reach out and make an attempt to see
if if I can provide some perspective and some help.
But since then they've had a change in leadership, and
my hope is that they're able to make that that

(22:49):
change because I do think that they're making a huge impact.
UM currently. Has the explosion of technology and the internet
changed your management and in leadership theories over time? Now?
Because I think that I think that the principles of

(23:11):
leadership don't change. I think the application does, which the
Internet and things have like that have changed the application.
But I think that the principles don't change over time
that much if you really step back and look at it.
Did you have any mentors who taught you about management
and leadership? I did. I had one, in particular, the

(23:31):
CEO of that company that we grew to a billion dollars.
His name was Bill Moore. And I'll tell us real quick,
is um when we when we're selling the company, said, Kirk,
you should go help other people. You've got a unique
ability to look into the heart of the company. He said.
He wanted to invest in me, and I remember thinking,
why would you want to invest me? There's no return
in that, you know, if I'm going to go and

(23:52):
essentially help other people. And he said, Kirk, I don't
want to return. And that's when I realized, and I
was embarrassed that I was kind of for myself because
my first reaction was, if you can't get something out
of it, why would you do that? And Bill Moore
was somebody that was a for you leader, somebody that
he just wanted to invest in me. He saw something
in me I didn't see in myself. And that was

(24:13):
my first real eye opening experience. And he was a
mentor that I got to watch and behave and see
how he behaved with people in business and in very
tough situations. He has spent the last twenty years helping
over eight thousand leaders scale their businesses and themselves. He

(24:34):
literally wrote the book on leadership and the issues that
stalled rapidly scaling companies, Predictive leadership, avoiding the twelve critical
mistakes that derail growth hungry companies. Kirk Dando, thanks for
joining us. If you're looking to hear more from Kirk,

(24:55):
he's launched a podcast called for You Leaders. By the way,
if you have comments about the show or suggestions for topics,
please email me at a Closer Look at Bloomberg dot net.
That's a closer look one word at Bloomberg dot net
and follow me on Twitter at Arthur Levitt one word.

(25:18):
This is a closer Look with Arthur Levin