Our guest today is COO Alliance Member and Vice President of Search and Operations for Y Scouts, Sammy Siegal. Born and raised in Alabama, Sammy has worked in general practice senior management level executive search, managed entry-level talent acquisition strategy and execution within the big-4, and led talent acquisition at a SaaS startup supporting the cannabis industry. He’s passionate about developing high-performing recruiters, creating recruiting structures, and finding the right “purple unicorn” for clients. Sammy has search experience in most functional areas across the leadership spectrum including: CEO, President, accounting and finance, operations, sales and marketing, technology and product, human resources, people and culture.
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In This Episode You’ll Learn:
- The three core values of a successful leader.
- The purpose-driven approach to recruiting.
- Why the CFO has become the second-in-command to the CEO in newer industries, such as cannabis.
- What companies need to do to get the best search results when recruiting.
Resources:
Connect with Sammy: Website | LinkedIn
Connect with Cameron: Website | LinkedIn
Get Cameron’s latest book “Second in Command: Unleash the Power of your COO”
Subscribe to our YouTube channel – Second in Command Podcast on YouTube
Get Cameron’s online course: Invest In Your Leaders
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In this episode, we’re excited to have with us Sammy Siegal, who is the Vice President of Operations for Y Scouts and a certified rockstar in the world of executive search. As someone who’s passionate about purpose-driven companies, Sammy is here to tell us about the importance of finding meaning and purpose in your work and how Y Scouts is leading the charge as a certified B corp and member of Conscious Capitalism in the executive search space but that’s not all.
Sammy also got some insider knowledge on what it takes to be a successful COO, including the common mistakes that he’s seen candidates make when applying for positions and how companies can work more effectively with executive search firms like Y Scouts. Get ready and buckle up. Energize your brain because Sammy Siegal is about to drop some serious knowledge on us. Let’s get started. He’s also a COO Alliance member so we’re super excited to have him with us.
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Sammy, welcome to the show.
Thank you, Cameron. It’s great to see you again and great to be here.
You as well. We got to hang out together at our COO Connect event, which was our in-person COO Alliance event. We had 46 members from all over North America. It was awesome to be able to hang out with you there and get to know you a little. Y Scouts are a big partner of the COO Alliance. You’ve been one of the exclusive executive search firms, and certainly our high-level biggest partner for the COO world. Why don’t we start with that? Why don’t you tell us who Y Scouts is? Let’s go deep around that.
At Y Scouts, we’re the original purpose-driven executive search firm on the planet, founded back in 2012 by our co-founder and current CEO, Max Hansen. Our process back then was so unique and forward-thinking that a lot of companies even had trouble grasping the concept of our purpose-driven later back in 2012. Our process was developed by a neuroscientist at the inception.
It developed our Y Scouts leadership model for hiring, which we don’t believe any successful leader out there can be successful without embodying these three core values or traits, learning relentlessly, developing others, and driving results. We look for this in every single senior leader we hire for our clients, including all of the COOs, and the second in command that we hire for all of the amazing other COO Alliance partners and clients.
You look for some base-level core values that are in addition to the core values of the companies you’re recruiting for.
From the research that was done during the inception of Y Scouts, we screened candidates based on not only the business acumen and technical capabilities you’re required for the role like every other traditional search firm is doing out there but on top of that, we also have a proprietary process, a discovery process in the beginning that allows us to align and screen candidates based on our client’s core values.
In addition to that, we screen candidates based on learning relentlessly, developing others, and driving your growth because we don’t believe you can be a successful leader in the world without inviting those three characteristics. We have questions we ask the candidates during the discovery process. We also supply our clients with questions specifically related to the Y Scouts leadership model for hiring so they can inquire as well.
Years ago, you got involved with Conscious Capitalism. Is Y Scout still a partner, a board member, or working with that organization?
Absolutely.
Why were you a part of that?
We believe that the companies we want to partner with should have a purpose other than printing money. Our purpose is to transform how people and companies connect. We signed up for Conscious Capitalism, made that pledge, and also signed up and got certified to be a certified B corporation. We were one of the first third firms on the planet to be a certified B corp.
We want to partner with companies that have a purpose other than printing money. The ultimate goal of starting a business is earning money. You can have other purposes too. Whether it’s a sustainability cause, diversity inclusion cause, or whatever that is, we want to work with companies with a purpose other than earning money.
Is that what differentiates you from all the other executive search firms out there? You tend to focus on the COO and CFO search predominantly for real companies. We’re not talking $100,000 COO. We’re talking about $200,00 to $400,000, the real COOs and VP operations. Is the purpose-driven stuff what separates you or are there differences in your model and the way that you work with clients that differentiate you as well?
All of the above. We have a covert discovery process number. We don’t post jobs. We’re reaching out specifically targeting candidates. 1) We utilize four different research analytics tools to make sure that we’re finding every single applicable candidate on the planet. 2) We screen candidates based on the role specifications as well as their core values and purpose before they even know what the role is and who our client is. This allows them to sell themselves into the role in a specific way and allows us to screen them on their purpose, mission, and values before they know who the client is so we know if there’s an alignment or not before they can sell themselves into the role.
When your CEO Max Hansen explained that to me, I had to process that. All of these very seasoned senior qualified candidates are essentially starting the application process and the interview process for a company in a role they’re not even being told what it is. It’s almost like you’re not going to waste your time telling them until you know if they’re a fit on the core values and their core competency side.
If they don’t meet the basic qualifiers for the role in terms of a value system, purpose alignment, technical capabilities, and business acumen, we don’t tell them who our client is. We politely say, “It might not be the best fit. We enjoyed our conversation. We want to work together in the future,” but we don’t tell them who the client is if there’s not a fit in the basic qualifiers.
It’s funny, this might have been right around when you were joining the company but Y Scouts did a search for a company called John Berry Law. John, the CEO, wanted to find a COO who was a former military and a current lawyer and could operate as a COO in space. He had to be super type-A and get along with John, who’s a crazy type. I’m like, “John, it’s not going to happen. You can find them with legal and ops being able to get along with you but not with a senior military background as well.”
You guys did it. You pulled the needle from the haystack and found this person. I was super impressed with that. You noticed a trend. You told me offline that you’re noticing CFOs are often becoming the second in command in the company as much as often the COO is. What are you noticing there? Can you walk us through that? It is super intriguing.
We’re starting to notice it. I might be biased because I have a Bachelor’s and Master’s degree in Accounting. I spent six years working for PwC. I love talking to CFOs but in newer and emerging industries, let’s utilize cannabis as an example here, the finances are so complicated and complex that the CFO has become that number two. A lot of those types of organizations are emerging.
Without a high level of understanding, professionalism, and control of the finances, the business can’t operate. It’s similar in a lot of other industries with the operations. If the operations aren’t in tight control, they can’t operate. That’s also true for newer and emerging industries, cannabis as an example. The CFO has become number two because the CEO has to tell them or ask them and base every decision they make on their advice.
Approach To Recruiting: If the operations aren’t in tight control, they can’t operate.
Even when I started the COO Alliance, one of the things we identified was that, quite often, our members are not the COO. What they are is the second in command to the CEO. I almost think that I should have relabeled it or rebranded the COO Alliance as the Second In Command community or something because we have quite a few of our members play the CFO role. Even at the COO Connect event we had, about 50% of our members have a finance report to you, whereas about 50% don’t.
You’re right, though. There’s a need there for them to understand the financial side of the business. Before we get into some of the leadership and what qualifies you, why did you join the COO Alliance? What was it that you were looking for that made that a fit or was it Max, your CEO, that said, “You should take a look at this?”
I was lobbying Max to back me to join an amazing organization like the COO Alliance. I was double-promoted overnight in a surprise fashion at Y Scouts. I went from being an individual contributor to an executive leader in a matter of five minutes without any notice. As I’m building the company back up, restructuring, building the operations, optimizing processes, building new processes, KPIs, and metrics, I was thinking. This is after conversations with our clients, what their COOs are doing and why, what they need, and learning.
I needed some type of mastermind community of other like-minded number twos or second commands to bounce ideas off and learn from. There are a lot of people who’ve been doing this for a lot longer than I have that I can learn from. With a lot of our partners being in the COO Alliance, a bell went off my head. One day, I called Max and said, “Max, I would love to join COO Alliance. Would you please back me up?” He said, “Yes, I will support this.”
That’s a CEO who’s also involved in the Young Presidents’ Organization. He’s a former Entrepreneurs’ Organization member and a member of the Genius Network. He understands the value of mastermind communities. About 80% of our COO Alliance members, their CEO is in some kind of a mastermind or an organization for entrepreneurs. I’m glad you recognized that and lobbied for that. When you said double promoted, what was your initial role at Y Scouts? Why did that double promotion happen so quickly?
I was hired to be a search director, someone managing clients, finding candidates, sourcing candidates, and managing projects from start to finish. We had a little restructuring in the summer of 2021 with the old leadership team. Why they decided to promote me is another conversation but what I did was push some of our leaders in ways they hadn’t been pushed before as an individual contributor with the experience I’ve had in the past, leading up talent acquisition organizations, working in large consulting for a while within talent acquisition and consulting. Max and I are aligned in a lot of different ways on how to lead and run a business. He noticed that alignment and wanted to enlist my help in restructuring, reorganizing, and growing Y Scouts into a more professional organization.
Did you join the company as COO or did you get promoted years ago?
I was promoted in August of 2021 so less than four months after I joined the organization as an individual contributor.
To do that, what was it about Max and the company that had you say yes to that role?
I was in a position where I had come out of a nightmare situation with a startup I had joined four months before COVID. I was looking in but that wasn’t working out. There are a lot of different factors that play into that. When I was doing some soul-searching towards the end of that gig, I wanted something different. I had spent six years in executive search in Chicago, where I started earlier in my career before rejoining a large consulting organization. I wanted something similar. I wanted to go back to client service but I wanted something different. I did not want to join another traditional search firm where I was doing the same thing every day. It is boring.
I reached out to Y Scouts. The next day, I had a conversation. A week later, I was on with Max. It was a perfect alignment because I was looking for something different where I could make more of a difference. I could be in a purpose-driven organization other than working on printing money every single day. We are a small business. We are a business generating as much revenue as possible. We’re here to provide purpose-driven search, which is very different and unique. It caught my eye.
Approach To Recruiting: Y Scouts is here to provide purpose-driven search, which is very different and unique.
One of the things about search firms that have frustrated clients in the past is the idea of a retained firm that you’re paying for. There’s a difference between retained and contingency. Contingency is, “I’m going to pay you a percentage of the compensation the person gets paid if you find them.” You guys go out and work hard with the hopes of collecting that percentage. Retained is, “I’m going to pay you a percentage even if you don’t find the person.” In all likelihood, you’re going to work hard and find somebody. You have a different pricing model. Do you know that you’re more of a hybrid?
We’re traditional in terms of our fees in pricing. We charge 1/3 to get started, 1/3 of the fee after 60 days, and 1/3 of the upon official offer acceptance, which is similar to most firms out there. Cameron, let me ask you talking about contingent versus retained. You’ve been through transactions in the past. If you’re looking to sell a company, are you going to call one of those lawyers that’s on the billboard on the side of the highway or are you going to hire the best M&A lawyer you can find and pay them upfront to do a great job?
I probably won’t be calling the one off the billboard.
When you need a more professional service, a longer sales cycle, or a longer project or engagement, pay someone to do it upfront. It’s a lot more legwork throughout, at least in search of executive leaders. I always recommend clients to do that. Even if they don’t sign with us and they’re looking to hire a COO or CFO, whatever it is across the C-Suite spectrum.
If you don’t sign up with us, no harm, no fail. We’re here to partner with people who want to partner with us but make sure you go to a retained firm and hire a higher-quality executive leader. That person should be there much longer than if someone is slinging you resumes from people that they’ve had a fifteen-minute conversation that day.
Let’s say that I’m a company looking to hire or retain a search firm to do a search for us. How do I go about selecting which firm to work with? Let’s even say that we’ve already picked Wiseco. What do we do as the company that wants you to help us find somebody to help you find somebody? How do we show up and help the process? It’s like, “Help me to help you.” Tell us what the companies need to do to get the best result with a search firm. I’m sure there are lots of people that you guys could do better searches if they were showing up doing their part but they often don’t. What can they do to do a better part?
Commit your time early on. We have a lot of clients and people we talk to who want to sign the contract and not be involved again until we have a slate of candidates. In a contentious search, you can do that because if they’re sending you eight staff resumes, you don’t need to be involved until you interview the person. When you’re hiring an executive leader, you have to be involved. There’s no way else around it. If you’re not and we don’t know what’s in your brain, and we don’t have 100% transparent communication from you starting from day zero, that can lead to a misalignment of expectations and qualifications that the individual has.
The clients and the partnerships we see are the most successful. They have engaged stakeholders from day zero throughout. It is more involved at the beginning of a retained search. You are transferring much more knowledge, data, and time in the beginning and throughout but it pays off. You’re not hiring a $50,000-a-year staff person. You’re hiring a $250,000 to $500,000 executive leader. It’s expensive. Be involved throughout and as transparent as possible. Don’t hold any information from your search partner.
One of the things I’ve heard from companies in the past is they feel, at times, like the search firm has a conflict of interest. At the end of the day, you want us to hire the people or the person you’re pushing to us because you get a commission. There’s often this feeling that it’s like the realtor who only has one house listed. They’re going to show that house to everybody because they’re going to make the commission on both sides of the sale.
How do we know that the firm has our best interest and they’re not just pushing somebody for us to hire? What part of the process should we still run? If the search firm is saying, “We’ve already done the interview or the reference checks for you,” should we still be doing interviews and reference checks on our side as well?
It depends on the search and the client. Sometimes we do push but we push because we have expertise in this functional area or industry. We talk to people nonstop. Oftentimes, we may talk to a candidate, screen a candidate twice right after their presentation, look at it, and say, “This is the person.” We believe strongly that person is. Every once in a while, a client looks at it surface level and says, “I don’t think so.”
We have to rely on our gut, instincts, expertise, and understanding of this search. We have to make a call because we’re strong consultants and advisors. We’re experts. That’s why people come to us for help because we’re experts in that functional area, industry, and position. Every once in a while, we do push because we believe this is the right candidate and work their time to meet. As far as a conflict of interest goes, we have a six-month guarantee. If that person we’re pushing does not work out, we’re replacing that person for free. Ninety-five percent of the time, a hiring manager is going to know that person is not the right person within six months.
Let’s talk about you as the Vice President of Operations. What skills are you working on or trying to get better at in terms of your role? It was a fast promotion but you’ve been in the role now for a bit. What are you working on day to day?
It is building and measuring not only KPIs and metrics across the organization as we’re maturing as an organization and becoming functional. I operate these teams for the first time in wide-scale history but it’s building and measuring the right, correct, and appropriate KPIs and metrics across the organization. We run on EOS, the Entrepreneurial Operating System, which we love. Using their principle of leadership, management, and accountability across the organization and doing it in the correct way is what I’m working on.
We’ve got a lot of our COO Alliance members who use EOS. I’m friends with Gino Wickman, who is the Founder of the Entrepreneurial Operating System, and his book Traction. Did you work with an EOS implementer or as a company, did you self-implement EOS?
We used an implementer for years for whatever reason. The decision was made away from that but we have made the decision to go back to an official implementer. We were down in Scottsdale for eight hours meeting with our implementer, going through our Q2 poorly planning. That will be a cadence we are on within an official EOS implementer going forward.
If you didn’t have one, I have a great one I was going to introduce you to that is local as well. You mentioned transition in the industry. I wanted to ask a little bit about what’s it like running a search firm when so many companies are laying off. Is there worry? Is there panic? Is it harder to find clients? Can you speak to that? Is the media maybe getting us all a little bit nervous when we don’t need to be?
It’s all of the above. If any hiring expert or financial expert tells you they believe what’s going on in the labor market, it changes by the day. We’ve never seen it before. In several sectors, we do have a recessionary trend. At the same time, we’ve got a few sectors that are outperforming but interest rates keep rising. Cash is so expensive. However, we’re still at decades low on employment.
We lost 3 to 4 million people from the US job market since the beginning of COVID. Going back to about 2016, legal immigration loss was changed and made a lot more stringent and decreased the number of legal immigrants that we can admit into the workforce. At that time, in 2016, every single Fortune 500 CEO said that was a bad decision. In 2020, when the COVID recession happened, we lost millions of people. That’s when it started to show us up. We’re still feeling that.
Approach To Recruiting: We lost three to four million people from the US job market in the last 38 months since COVID.
Although cash is getting expensive and interest rates are rising, the unemployment rate is at a record low. We’ve got clients that are reading the news that say, “I can get someone for 30% of their market pay.” It’ll take a month because everyone’s in the job market. What we’re seeing is that there’s a lot of B, B minus, and lower talent on the job market. If you want B minus lower talent, you can find it. If you want that A-talent, you’re still paying a premium because those people aren’t getting laid off. They’re being hauled tightly.
I’ve said for years as well that most companies that say they have an A-level team have a bunch of Bs at best. They don’t truly even understand what an A-level team looks like, acts like, and feels like until they have them. A-players are never out looking for a job. A-players already have jobs and they’re not quitting to go work for an average company. What are your thoughts about recruiting in this post-COVID environment where companies are hybrid or remote? Is that making it easier, harder, or different?
A little bit of both. We’ve got some industries that don’t have the flexibility of going remote. We’ve got clients in manufacturing, construction, and similar industries where there’s no option to go remote because they’ve got to be on-site and at the plant. Those roles are a little bit different. Those candidates in those industries know. They know they’re going to the office and the plant site.
In other industries, it’s helpful because we can cast a wider net but at the same time, the candidates that are working remotely and want to work remotely got so many options. If a company has the ability to work remotely, depending on the industry and whatever it is, and they’re not, and they’re only looking in their local market, they have to realize that those candidates in that local market not only are looking in that local market but are looking at every single other market in the United States. Their competition is way fiercer in the candidate’s market.
Years ago, we used to protect consumers against predatory pricing for companies going in and pricing low and hurting other companies in the industry. Now, it’s almost like predatory hiring where we have all these tech companies in the Bay Area have all this cash. They’re out hiring and overpaying for roles but now they’re overpaying for people that are in Ohio, Iowa, and North Dakota. They don’t care where people live anymore. Are you seeing companies adjust the pay for remote hires, work-from-home hires, or hires in other states? Is that adjustment being absorbed because of competition still?
Yes and no. There are a lot of companies in Ohio, Michigan, or Kansas that have a lower cost of labor. They simply can’t afford to outbid the companies out of Silicon Valley, especially when they were paying all the cash they could for top-level talent. It raised the cost of labor in pretty much every market in the United States. That was necessary after many years of not raising the cost of labor in the United States. The pendulum swung back a little bit in the candidate’s favor. You’re seeing an inch back in the employer’s favor with layoffs happening in several different sectors but it did raise wages pretty much across the board. Depending on the city, it depends on how much.
What’s it like working with an entrepreneur who is ADD? I’m not sure if Max is so bipolar but he is a perpetual motion machine, has big energy, and lots of ideas. What’s it like working with an entrepreneur like that? Can you give advice to any other second in command or CEOs out there that are like that and how they can better work with their teams?
Working with Max has been fantastic. There’s no way for me to measure what I have learned from him and his entrepreneurial mindset and visionary mindset. I learn every single day from him. The challenge of working with a visionary CEO is that they are visionaries. Oftentimes, CEOs may see a shiny object and want me to chase it. Every once in a while, they might see multiple shiny objects at the same time, which can change the focus of their second in command. When it goes top-down, it can change the focus of its staff.
The shiny objects we chased have been completed in their projects. The challenge is, when to push back, when to pick your battles, how to pick your battles, and how to push back for any second in command because if we said yes to everything our CEOs and visionaries wanted, we’d be working 100 hours a week and not getting anything done. For me, it’s all about having the data. This is what works, this is the data that we have, what works, and what may work. It’s knowing when to pick those battles.
My advice to other COOs is you have to have thick skin and be confident in your decision-making and when to pick battles. Oftentimes, that’s driven by data. We can’t just say, “My opinion is,” to a CEO because they’re too smart for that. We’ve got to say, “This is what the data is telling us and why we’re pushing back and saying we should not chase this.”
My advice to CEOs and visionaries is to give an extra 90-second thought to that shiny object. “Is this something we need to be chasing in the next 14 to 28 days and why?” I’m not asking them to do a full cost-benefit analysis of all those decisions because that would slow them down too much. They would be taking them away from their visionaries. Maybe instead of saying, “Let’s chase this,” ask your second in command, “Do we have data to back this up? Why don’t you create a cost-benefit analysis on this quickly, spend 20 minutes on it and then let’s discuss it at the end of the day?” Build data into any decision.
Let’s go back to the 21 or 22-year-old Sammy Siegal. He needs some advice from the current you. What advice would you give the 21-year-old that you know to be true now but you wish you’d known back then?
I was not very smart as a 21 or 22-year-old. I was obtaining my Master’s degree from the wonderful University of Kansas, Kansas Graduate School of Business in Accounting and Taxation. 1) I wish someone would have told me other than my great aunt after the fact that I was too ADD to be a strong tax accountant. 2) I would tell myself to trust my gut more and focus. As a 21 or 22-year-old, all I wanted to do was go out and have fun in grad school and Chicago where I moved when I was finishing up grad school.
I would tell myself, 1) Be more confident in your decision-making, 2) Be more confident in the goals you want to achieve, and 3) Be more confident in what you want to pursue as a career. When I graduated my grad school, it was August 2008, a couple of months before the economy went down so I got rattled as a lot of other people in my age group did.
We didn’t know what to do. A lot of us lost our jobs in the next years. We were figuring out what we wanted to do with our careers and making career changes but we were not mature enough to know what we wanted to do, how we wanted to do it, what we were good at, and what we sucked at. Focusing more on that at that age range for me and getting more strategic to that could’ve helped.
Sammy Siegal, the Vice President of Operations for Y Scouts, I’m super appreciative of your time. I love the fact that you’re a COO Alliance member as well. I appreciate you sharing with all of our readers as well.
Thank you, Cameron. It was an honor to be here with you. I appreciate your time as well.
A reminder to everybody that all of our episodes are also shared on the YouTube Channel, as well as wherever you listen to podcasts. Check us out on YouTube too. Thanks, Sammy.
Thank You.
Important Links
- Y Scouts
- Entrepreneurial Operating System
- Traction
- YouTube Channel – Second In Command Podcast with Cameron Herold
