Situation: The CEO is moving a key employee from head of engineering to a more customer development focus. To support this, she will have to bring in or promote another employee to fill the position of leader/supervisor/manager of the engineering group. The CEO seeks advice on the best way to approach finding a replacement for this key job. How do you replace a key position?
Advice from the CEOs:
• First, it is necessary to develop a timeline for finding and transitioning the replacement. Realistically, count on 6 months to find a replacement and transition the responsibilities to a new person.
• Keep in mind that anybody you find or promote will be different from the individual who currently occupies the position, and will not handle their new responsibilities the same way as the current individual. Their motivation and their approach to their new responsibilities will be different, at least at the outset, and they will not handle their responsibilities the same way that the current individual does.
• Seek an individual, either currently within the company or an outside hire with strengths that, over time, will add significant value to the organization. Prepare for this by brainstorming and developing a profile of the ideal candidate.
• If you have qualified candidates, the ideal person will come from within the organization. This has the added advantage of demonstrating to other employees that they, also, may become candidates for future positions to grow both their skills and income.
Category Archives: Leadership
How Do You Purchase a Company as a Non-Owner President? Four Points
Situation: The President of a company has a long-standing relationship with the Chairman and Founder, who is also the principal owner of the company. The President joined the company at a time that the Chairman/Owner thought that he was terminally ill and needed an individual who could take over operations as well as leadership. Since then the owner has fully recovered and wants to retake control. The President would like to buy out the owner. How do you purchase a company as a non-owner President?
Advice from the CEOs:
• What role has the President played so far? The President has advised the Chairman on how to grow the company and is leading this growth through developing key customer relationships.
• What is the owner currently doing? The owner has fully stepped back into his prior role, and is micromanaging all aspects of the business, effectively shutting out the President.
• The best way to avoid a situation like this is to negotiate the full deal, including transition of authority and terms of transition of ownership, up front before the signing of an employment contract. Not having not done this, the President currently has no leverage.
• The best option at this point is to have a conversation with the owner and to see whether the owner is open to a transition of either power or ownership. If the owner is not interested, the President may want to consider other opportunities.
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What are the Trade-offs of Becoming a Company Principal? Four Points
Situation: A senior employee is on a good growth track within her company. The CEO has stated that he believes that she has the potential to become a principal of the company in the future. What are the tradeoffs of becoming a company principal?
Advice from the CEOs:
• Becoming a principal involves both greater potential rewards than being an employee and greater potential risks. Create a chart with two columns. In one, list the potential rewards of having a stake in the company. In the other list the costs and potential liabilities. This will help to weigh the rewards against the liabilities.
• Areas to negotiate include voting rights, granting of options, understanding the perks of becoming a partner, and also the possibility of legal liability for any malfeasance that the company may commit.
• If you see liabilities that concern you talk to an attorney – your own, not the company’s – about how to address these liabilities in the terms of an employment contract as a principal.
• Evaluate the potential long term value of the ownership share being offered. Does the company have a buy-back policy for a principal’s ownership share and, if so, what are the terms?
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How Do You Change the Company’s Culture? Six Suggestions
Situation: The CEO wants to change the company’s culture. How can the CEO facilitate “buy-in” to support this cultural change? How do you change the company’s culture?
Advice from the CEOs:
• Encourage staff to think BIG – project 50 years ahead to a $2 billion company with business in 10 countries.
• Ask questions: Can we achieve it? Can you imagine that far? Is it real? What would make it real?
• Encourage participation in this exercise across all functions.
• When one company wanted to make a major change, they brought in an expert to help craft the communication of the changes and to explain it to staff.
• Move fast – don’t go slow. Let people know that it is OK to make mistakes. This is the Try-Fix-Do model that helps to encourage creativity and rapid development of new ideas. It makes going fast less of a risk to the individual.
• Let people know that it’s OK and necessary to challenge each other. Their involvement and input are what’s important. Keep it real and civil.
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How Do You Redefine the Top Executive’s Role in the Business? Four Points
Situation: The President of a family-owned business that has been in operation for over 30 years wishes to change her role by increasing delegation of responsibility and accountability within the business in preparation for her eventual retirement. Other family members in the business are happy with their current responsibilities and are resistant to taking on more responsibility. What advice does the group have for this member?
Advice from the CEOs:
• Given that you are preparing for retirement, it is important to let others know about your plans and your desire to increasingly hand off your responsibilities to others. Ideally, one or more of the others will express a desire to take on more leadership, particularly if it includes a boost in pay.
• It is important to clarify responsibilities and prioritize which ones you wish to hand off. Once this is done build and execute a hand-off plan.
• Transition current managers who are misplaced in their position to other roles. Work with them to identify alternate roles where their talents can better benefit the company. They may be aware of their current discomfort and welcome the opportunity to take on a different role more suited to their abilities.
• Focus on removing barriers to delegation that may be in place. For example, bring others into the discussion and review the projects that they are overseeing. Identify the challenges underlying those projects and ask for their suggestions on how to address these. Don’t provide the answers. Ask questions and push them to develop appropriate solutions.
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How Are You Preparing for Next Year? Two Approaches
Situation: A CEO and his team are preparing for next year. There is a lot of uncertainty as to how the year will unfold and what the economic and financial environment will look like. What are others doing to plan for next year and beyond? How are you preparing for next year?
Advice from the CEOs:
One company built a 5 year plan to 2028 about a year ago.
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- They are now reviewing the plan. Their core has been growing faster than anticipated as a result of the new sales effort. For next year and beyond they are revisiting the plan and revising it both to take advantage of the new sales effort and to leverage this success into other areas.
- Within the plan, priorities for growth have been identified, and the company is on target to double the size of the company in 5 years.
Another company established a Strategic Priority Team a few months ago.
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- They started by setting goals for 2025 to 2030. They followed this with a plan for what they need to do year by year until 2030 to realize this plan. They recognize that there may be speed bumps along the way but have established the internal discipline and capacity to address these.
- Within the plan, they are looking at expanding ther facilities in 2nd half of 2026, and plan to double both their space and staff over the planning period.
- An additional area where they will focus is their current and new business development effort.
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How Do You Balance Competitive and Collegial Behavior Within The Team? Three Points
Situation: A CEO has built a company which is very collegial. She is interested in adding an element of friendly competition within the company. Would it be destructive to add an aspect of competition to the mix? How do you balance competitive and collegial behavior within the team?
Advice from the CEOs:
- This can be achieved by focusing on recognition, and encouraging recognition of each other among the team members.
- One example is to have traveling trophies.
- One trophy could be circulated on a periodic basis based on measurable criteria. Examples include new client acquisition, increases in revenue, or increases in savings by improving processes. There are many positive achievements that can be recognized.
- A second trophy could be awarded for “assists”. Examples include one team member helping another to land new accounts, a team of employees developing a cost-saving improvement to process, and developing a new accounting technique that saves the company money.
- A third trophy could be awarded to one team member for a job well done, and then awarded by that member to another member for another job well done, and so on.
- To add to the collegiality, some of the trophies can be passed around spontaneously for on-the-spot recognition. Others can be awarded on a scheduled basis such as annual or quarterly employee or company meetings. Mix it up and be sure to make it fun!
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How Do You Correct Inappropriate Behavior of a Productive Employee? Four Points
Situation: A CEO has a key manager who frequently uses inappropriate language and demonstrates lack of care towards co-workers. This individual is smart, has great drive, and does the work formerly handled by two employees. How do you correct inappropriate behavior of a productive employee?
Advice from the CEOs:
- Create a firm company policy on swearing and the use of inappropriate or abusive language.
- Each time any individual swears or uses inappropriate language, they must put $1 into a pot. Anybody can call anyone else for swearing and the one who’s caught has to pay. The money in the pot goes to buy pizza on Fridays.
- This is a creative and even entertaining solution and should resolve the problem in a short time.
- Sit down with this individual and go over their positives and value. Besides these, emphasize which behaviors are unacceptable.
- Explain the legal implications and consequences for the individual and company. Provide goals and set objectives.
- Send this individual alone or with a team to a Pryor Customer Relationship seminar, for example the seminar “How to Communicate with Tact and Professionalism”.
- Let the instructor know in advance that you want to be sure that certain behaviors are covered during the seminar.
- This may provide the individual the incentive to behave like an owner of the business.
- Make it clear who’s in charge, and at whose discretion the individual remains with the company.
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How Do You Use Focus and Communication to Strengthen Your Leadership? Three Points
Situation: A CEO is curious about how others have strengthened their leadership skills over time. From discussions with other CEOs she has gathered that focus and communication are important strengths to build. How do you use focus and communication to strengthen your leadership?
Advice from the CEOs:
- Often the process is more important than the actual decision because the process frames how the decision is made.
- If the process is open to new ideas and approaches, and these are welcomed in the discussion, this can generate both more creative decisions as well as increased buy-in to the ultimate decision being made.
- One CEO finds that his company is always focused on the outcome. However, he has grown to understand that it is important to frame the decision-making process around your values.
- Value-based decisions not only generate increased buy-in by all involved, but they strengthen the sense of company culture and values.
- Another CEO was faced with a personnel issue. She found that by analyzing past decision-making processes company leadership was able to identify a previously unrecognized factors and processes that fed the personnel issue.
- By addressing the process, the company was able to resolve the issue to the satisfaction of all.
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How Do You Focus Your Team? Six Points
Situation: Several CEOs asked how others have had success improving company performance and is interested in how they focused their teams. How do you focus your team?
Advice from the CEOs:
- Important tasks for any company are to validate the value proposition, technology, target customer, and the rate of market expansion, and minimize risk and liability. This should be a regular company exercise – not a one-time event.
- Assuming that a company has goals and people who can align with and achieve them, a company needs a vision – the broader strategic picture of where they are going. Often some of the best ideas come from line staff who are enabled by their company’s culture.
- It is critical that companies are able to quickly identify problems and have systems in place to drive problem resolution. The minigame technique is very useful in these cases.
- Companies should have a plan for transitioning employees into new roles as the company grows. The key is clear identification of the individual’s role within the company, and how that role compliments achievement of company objectives.
- If a company wants to grow sales from, say, $20 to $60 million, it will need a professional sales leader. In addition, growth may require a change in company culture from engineering and development centric to sales centric.
- A significant challenge is determining how to define corporate success. Much depends upon the questions asked. The Great Game of Business by Jack Stack provides guidelines and tools for assessing options. Anyone starting or growing a business should look at this book.
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