There are three things investors look for: management, management, and management.  But how do you select the right people?

A recent book has some answers.  Take a look at Executive Intelligence: What all Great Leaders Have by Justin Menkes.

Menkes defines the three areas of managerial work as: accomplishing tasks, working with other people, and self-evaluation.  Some highlights of the critical skills:

• capacity to distinguish between primary and secondary goals
• ability to anticipate probable outcomes and unintended consequences
• ability to recognize the underlying agendas of others

Don't let the cover fool you. In my opinion, these skills apply to everyone in the team.  In a fast moving environment everyone must be a leader.

Menkes is critical of traditional interviews, personality profiles or work-style tests as a selection technique. I tend to agree, however, they can be very useful for team building and ensuring that you develop a more balanced team.

The best way to select staff is to use an "oral exam", setting a series of hypothetical business problems and asking them to verbally answer how they would solve it.  This technique has saved me from a few problems.

Bottom Line: Everyone must be a leader. Use hypotheticals to test candidates. Don't forget the self evaluation.