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Team Building: Lessons for Obama and CEOs


The President-elect must avoid the same hiring hazards that face any new leader

Barack Obama will soon be the leader of the largest government in the free world. But right now he's up against a challenge faced by any new boss. His biggest job—with enormous implications—is assembling the right team.

And just like other new bosses, the President-elect will soon discover how easily that process can go wrong. Trusted allies plead their cases. Powerful forces block certain candidates. Time pressure mounts. Then one day you look up to discover your inner circle is not the A-Team you dreamed of but an all-around compromise.

What then should a leader do to build the best team? Since the process is so fraught with pitfalls, it might help to look at three missteps that commonly undermine a dream team in the making.

Automatically reward loyalists. No matter how long you've worked for the top job, once you get it, the impulse is to "endorse" your own early endorsers. We know of a new CEO, for instance, who appointed his longtime HR chief as president of the company's digital division. His gratitude for her support simply outweighed her limited experience.

What a shortcut to mediocrity, if not disaster. Not all loyalists are hacks, but if they don't possess enormous brainpower, prodigious energy, and the ability to motivate, loyalists will forever remain B players in A jobs. That's a huge problem for a simple reason: B players tend to hire other B players or, worse, C players, setting off an organizational chain reaction of underperformance.

Hire people who need the work or lust for the prestige of being on your team. There's almost nothing more appealing than a job candidate who looks you in the eye and tells you how passionately he wants to be your partner. "How perfect," you think, "a person who shares the vision."

And well he might. But there's a real danger if there are other motives as well, like advancing a stalled career or resurrecting a damaged one. Such individuals are like the "independent" directors, often diplomats and finance professors, so many boards installed in the wake of the Sarbanes-Oxley Act. They collect directorships like knickknacks, and they're the advisers least likely to deliver contrary messages. Why bite the hand that feeds you?

The President-to-be deserves kudos for avoiding this misstep with his appointment of Rahm Emanuel as Chief of Staff. Emanuel has been criticized as a partisan. But he's as smart, energized, and outspoken as they come, and more important, he will be able to disagree with his new boss without an ounce of fear. Multiple high-paying, high-prestige jobs await him in the real world.

Focus all your attention on crisis hires. Most new leaders inherit a burning problem, and naturally the tendency is to fixate on finding the right person to put it out. That has to be done. But a new boss must also rapidly attend to the leadership positions that address his overarching and long-term priorities. Remember, every hire you make says: "Here's how much I care."

Right now the media is obsessing over Obama's selection of a Treasury Secretary. Imagine how the conversation would change with the announcement of a brilliant, hard-hitting Energy chief. Such a decision would speak louder than any speech, just as it does when a business leader picks a respected manager to push forward a key strategic initiative. In business, as in government, the leader's personnel selection is the ultimate message.

Along with facing the daunting task of assembling the right team, President-elect Obama is like every new leader in another way. Once he's boss, even his most trusted and spirited advisers will want to please him. Sycophancy is an ugly word, but it happens to the best of people, and leaders often can't help but be susceptible. In the months ahead, Obama's larger task will be combating such a dynamic by demanding debate, celebrating dissenters, and holding up free-thinkers as role models. That's hard. But leaders must fight to make it happen, and they can—provided they have the right people around them to begin with.

Jack and Suzy look forward to your questions. You can e-mail them and view their new Web site at welchway.com. For their PODCAST, go to businessweek.com/search/podcasting.htm

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