A CEO wants to significantly grow his company, either to prepare for an IPO or
to become an interesting takeover target. However, he struggles with
delegation. When responsibilities are delegated, the job isn’t done to the
CEO’s satisfaction and he ends up doing the work himself. He asks: what is the
CEO’s job? Is it for me?
from the CEOs:
order to grow the company to the desired level, it is necessary to hire
competent people and delegate. The most important position will be a COO with
deep experience organizing people and functions.
CEO’s role is to provide the vision and strategic objectives for the company.
The COO’s role is to assure that the right people are in place or hired to do
the work necessary to realize the vision and operational objectives.
CEO-COO relationship will be pivotal. If there are specific ways that the CEO
wants to see things done, these must be clearly delineated in discussions with
role of the COO will be to organize the company to reach the growth objective.
a competent, talented HR person to plan the organizational development road
map, and the positions that must be filled in stages to reach the goal.
growth plans of the company are ambitious. Absent significant change, growth
will be limited to a fraction of the current objective.
with the COO and HR person, build the organizational chart for the size company
that the vision imagines. Fill the chart with current personnel where the fit
is appropriate. Determine where the gaps exist and build a plan to hire these
people in stages.
E-Myth Revisited by Michael Gerber provides an exercise to accomplish this.
a high-level assistant to help in areas where the CEO finds it difficult to let
go. This will be another key relationship and will be important to learning how
to let go.
a CEO coach.
will likely be an individual with significant experience who has achieved the
growth envisioned by the strategic plan.
CEO Coach will help to draw lines between delegating and micromanaging and will
help the CEO to learn to effectively delegate to qualified people.
Situation: The CEO of a small company finds that whether he gives broad direction to employees or very specific instruction he gets the same result: they don’t seem to understand what he wants. He feels that they don’t have a sense of buy-in or urgency. What are best practices for effective delegation to improve results?
Advice from the CEOs:
You recently fired an employee for inconsistent performance but didn’t tell your staff. When you return to the office this afternoon, get the employees together and tell why the individual was fired. Let them know that this is part of a broader pattern that you see within the company and that if you see other cases of individuals not following through on their assigned responsibilities you will have to take additional action. Unless your employees understand that nonperformance has consequences, there will be no change.
In your operations, set subassembly goals and intermediate milestones coupled. Create and post a set of charts in the operations room so that employees have a regular visual reminder of how they are doing. Bring these charts to employee meetings and discuss how the company is doing. If deadlines aren’t being met, ask for input on how to improve performance. Celebrate successes with recognition for individuals or groups who demonstrate the ability to meet objectives.
Hire an operations manager with experience working with teams the size of yours. You want an individual who excels at motivating and getting results from people, and who has supervisory versus managerial experience. Think platoon leader – a person who excels at effectively running small teams.
Situation: A mid-sized Company is more than three decades old. The challenges are modernizing operations and updating company culture to keep pace with customer expectations. They also need to diversify into new growth markets. Can they change the culture of the company without losing key people?
Let people know that you value them. Consistently express your appreciation for what they do for the company, and don’t blame them for not being perfect. For them to be willing to grow as company culture changes, they need to feel safe – to understand that a change in culture does not mean the loss of their job.
Give employees consistent face time. Ask questions and seek their solutions instead of proposing your own. Involve them through collaboration. Tolerate the fact that their solutions won’t be exactly like yours.
Pick your battles. Select what you want to change and conserve your emotional capital. Think about what’s important and what’s not before you intervene. Let minor issues slide as long as they don’t impair schedules or performance.
Maintain an open door to all levels of the company. However, when an employee comes in with an issue or complaint, defer judgment to their manager. Never undercut your managers.
Your most important strengths will be patience and understanding. Stay mindful that change can be threatening, particularly if employees find it hard to see the big picture. Keep your themes and messages simple and repeat them as often as necessary to keep everyone focused.
Situation: The CEO was just promoted from COO. During the transition, the CEO is responsible both for past and new duties. There is an extensive list of Company priorities. How should the CEO prioritize this list for action?
Advice from the CEOs:
Focus on Executive Committee roles first – the roles of your leadership team.
Select your leadership team carefully – the team that will implement your agenda. They will help you make key choices and implement changes and programs. It is essential that this team present a united front as you roll out any changes.
As CEO, you are now accountable for the success of the company.
Put issues on the table.
Gather input and advice from your team.
Make your decision on how to move forward.
Delegate responsibility and accountability.
Rally the team around your decision.
Follow-up to assure that things are getting done.
Be focused. If you only had the resources to do three things, which would these be? What will bring the greatest short and long-term value to the company?
Avoid micromanaging assigned responsibilities.
Bring in a consultant to assist you in implementing organizational changes that are necessary for the company.
Defining new roles and responsibilities.
Correcting behavior of team members that does not benefit the team.
As soon as possible, promote, or hire someone to take on your old roles. You will have your hands full as CEO.
Situation: The CEO questions whether he is the right person to lead the Company. The Company has solid revenues and profitability, but growth is lower than expected. How can the CEO improve his situation and solidify his leadership?
Advice from the CEOs:
The primary functions of the CEO are to assure the maintenance of company values, to provide vision, and to monitor resource allocation within the company.
Identify your strengths, and the most important areas where you need help. Create an organizational chart not of positions but of strengths that are needed within the company. Compare these positions with your own strengths, and focus your own activities on your strengths. Promote or hire talent to support you in the latter areas.
As you hire or promote and delegate, make sure that you are allowing those with new responsibility the latitude to run their areas of responsibility.
Should I consider hiring a CEO or COO?
Maybe. If you do, first identify the key leadership traits that we most want to see in a candidate.
If you hire a CEO, this individual should have skin in the game. They must be perceived as a leader, and there must be a clean hand-off.
Consider hiring a COO. This can be someone willing to take this role with the understanding that your long-term objective is to replace yourself as CEO. A person unwilling to come on as COO and to develop into the CEO may not be the right candidate.
Situation: The Company is hiring their first CFO. How do they integrate this key person into the company?
Advice from the CEOs:
The company should reflect the values, needs and desires of the CEO.
Have a clear discussion and agreement with the CFO candidate on values, role, and organizational structure before hiring or announcing anything to the company.
The talents of the CEO and CFO should complement each other.
The CEO may put the CFO in charge of areas that they want to delegate – accounting, administration, finance and contracts.
The CEO should remain involved in banking relationships.
Recommended announcements and timeline:
When the new CFO is announced, simultaneously present the new organization chart (broad responsibilities, not detailed position descriptions).
Set a timeline for realignment of roles. It is not necessary to specify exact roles at the time of the announcement – let everyone know that this is a work in progress and give a time frame within which all will be resolved.
Once the CFO is in place, the CEO and CFO should meet at least weekly, to assure that the CFO has the support and resources needed to accomplish their responsibilities.
All decisions within the CFO’s group, personnel responsibilities and any shifts in roles should come from the CFO, with the support of the CEO.
This will help the new CFO to more rapidly assimilate into the company and will give them the authority needed to manage their organization.
Situation: The CEO is concerned about the performance of both the company and individual employees. The employees are good, but there are many minor details of day-to-day operation that the CEO feels are important. How involved should the CEO be in the details of the business?
Advice from the CEOs:
The answer to this question depends on you.
What is your own priority on the use of you time?
How much do you want to be involved?
How confident are you in the people whom you’ve hired?
Are you comfortable delegating?
Do you want to stay small or scale and grow?
The good and bad of involving yourself in details:
The Good Side – communicates that you are willing to roll up your sleeves and do what it takes to get the job done.
The Bad Side – don’t do your employees’ jobs for them.
This is demotivating and communicates a lack of trust in their abilities.
If the workload is so demanding and the benefit so great, then secure additional resources to enable employees to get the job done themselves.
More broadly, remember the lesson from many business gurus – you increase the value of your company by getting the “U” out of your bUsiness. You may enjoy the detail of the business. However, do not let this interfere with your long term objective of having others doing the “doing” while you mature your role as manager and leader.
Situation: I recently hired a new high level manager. To integrate the individual into the company the original set of assignments was limited in scope – to help the manager get to know others within the company. This manager seems to over-analyze things. Long hours are spent carefully drafting plans but there is little action. Did I select the right person, and how do I manage them without micromanaging?
Advice from the CEOs:
It looks like this person is working long hours but not necessarily productive hours. This is costing you time and money – both yours and your employees. The question is whether the root cause is the individual’s behavior or your own expectations and behavior.
Ask yourself the following questions:
Have you clearly outlined your expectations in terms of what is to be delivered, the time in which it is to be delivered, and any constraints around the projects for which this person is responsible?
Have you provided necessary resources, and empowered the individual to make the decisions necessary to bring projects to completion?
Have you scheduled regular update meetings with this individual and openly discussed project progress and obstacles to completion?
Have you set appropriate expectations with your other staff as to the authority of the new individual, and are you honoring those expectations in your own behavior?
If you have done these things, and the individual is not performing, then it is time to ask whether you hired the right person.
Key Words: Manager Performance, Objectives, Expectations, Delegation, Planning and Review