InsightsLeadership5 min read
When to hire a full-time CPO
The honest version: the headcount, complexity and deal-timing signals that mean you should stop renting the role.
By Finesse Blumenthal, Founder and Managing Partner.
A firm that provides senior people leadership on a fractional basis has an obvious incentive to tell you that you never need the full-time hire. Here is the honest version instead. Most growth companies should not fund a full-time Chief People Officer yet. Some should have done it a year ago. The difference is legible, and it is worth knowing which side of it you are on.
The signals
Four things that mean the seat is due
Any one of these is a reason to start planning. Two together are a reason to start the search.
Headcount
Somewhere past a few hundred people the work stops being a set of decisions and becomes a function that needs running every day: recruiting at volume, managers in every location, a benefits program with real complexity. A senior person ten to twenty hours a week can set that up. They cannot run it.
Complexity
Multiple countries or states with different rules, a second business unit with its own culture, a platform absorbing acquisitions on a schedule. Each one is a full-time job on its own. Two of them together are a full-time leader.
Deal timing
Twelve to eighteen months before a sale, a buyer will want to see a people leader on the organization chart, not a contract. Hiring one at month nine, with no time to show results, reads as a fix. Hiring one at month eighteen reads as a plan.
The CEO's calendar
The honest signal. If the chief executive is spending a day a week on people matters that a senior leader would own, the seat is already being paid for. It is just being paid for in the most expensive currency the company has.
The false signals
Two reasons that are not reasons
A bad quarter. Attrition spikes, a leader leaves, a survey comes back angry, and the board asks who owns people. Hiring a full-time executive into a crisis gives you an executive who spends their first year on the crisis and a company that never finds out what the role is for. Fix the quarter with the leadership you can put in place this month. Hire the role when the company is ready to use it.
Because the peer company did. The company one stage ahead of you has a Chief People Officer, and the operating partner has noticed. What that company also has is the headcount, the complexity or the deal timing above. Copy the readiness, not the org chart.
Before the search
What to have ready so the hire lands
The most common reason a first Chief People Officer fails is not the person. It is that they were hired to build a function from nothing, alone, while also running it. A company that has the groundwork in place hires a leader. A company that does not hires a builder and calls them a leader, and the board judges them on the leadership they had no time to do.
- 01A people roadmap with owners and dates, so the new leader inherits a plan rather than a backlog.
- 02Pay levels and bands, so their first month is not spent reconstructing what everyone earns.
- 03A manager standard, so they can measure the managers rather than meet them one at a time.
- 04The monthly scorecard, already going to the board, so they walk into a rhythm instead of building one.
- 05A first-year scorecard for the role itself: the three things the board will judge the hire on, written before the search starts.
The honest sequence
Senior leadership now, on the terms the company can fund, to build the groundwork and run the plan. Then a full-time hire when the signals say so, into a function that already works. The engagement is designed to end that way, and the exit plan is written into it from the start.