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.
Tag Archives: Approach
How Do You Expand Your Market? Five Suggestions
Situation: A CEO’s company has historically been organized around a single company’s products and technologies, though their customer base uses multiple platforms. The company wants to expand from a single-technology emphasis to a broader technology base which will more accurately reflect its customer base. What can assist the company in building both its technology and customer base? How do you expand your market?
Advice from the CEOs:
• Conduct surveys among users and employees of the existing customer base. Use what is learned to design new approaches to expand both the company’s technology base and customer base.
• Expand into additional industries, products, and a more diverse company customer base.
• Determine to there is a genuine need for the company’s technology and services. If not, adjust both the technology and offering to better meet customer needs.
• Build a marketing campaign around differentiating factors that others do not provide. For example, in the cooperative banking industry market accounts that allow no-fee ATM access through other coop networks’ and banks’ ATM machines to expand customer convenience and appeal.
• Target niches. For example, small businesses or home businesses where the company’s lower fees make a difference and personal service is appreciated by the owner or someone who works closely with the owner.
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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 Make the Most of People, Processes and Technology? Four Points
Situation: A CEO wants to improve efficiency and use of people, processes and technology. What have others learned from their experience? How do you make the most of people, processes and technology?
Advice from the CEOs:
- One CEO gained new insights on the importance of details within the decision making process. She learned that details have had a much greater impact on the outcome of the decision process than her company had previously appreciated.
- Cost reductions may cost more than they save. If the longer-term vision for the company isn’t considered a company may make short-term decisions that actually cost more in the long-term.
- Difficult times equal opportunity. The key is keeping your head together and approaching challenges objectively, with an eye to long-term consequences of the choices made.
- Always maintain balance in both choices, decisions and execution. There will be surprises along the path. Open eyes and balanced consideration will help to address these surprises constructively.
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How Do You Make Hard Decisions on Employees? Four Points
Situation: A company needs to adjust expenses to control costs. It’s largest expense item is payroll. They are evaluating three options to adjust staff costs to anticipated revenue. Alternative A – Cut everyone back to part-time. Alternative B – Cut a few employees, but keep retained employees busy. Alternative C – A balanced approach between these alternatives. From others’ experience, which is best? How do you make hard decisions on employees?
Advice from the CEOs:
- The unanimous response from the group – for employees, Alternative B is the most positive approach. Extended cutbacks in hours has been painful for all and led to grousing. Once staff were cut it helped retained employees to focus on their work.
- When it comes to vendors, use Alternative A – don’t pay everything that you want to pay, but pay what can be paid consistently and predictably. It is critical as this is done to make sure that promises are kept.
- When it has been necessary to make cuts – how has employee morale been maintained?
- In the short term, those who remained have been happy to have a job. Longer term, companies have had to do more than this.
- One option is to set quarterly revenue and expense targets. When gross or net margin targets have been exceeded, companies committed to share some of the excess with employees.
- Before making any decisions, have a meeting with employees and openly ask them what they’d like to see that will help to build company culture and enthusiasm.
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How Do You Get the Best from Your People? Six Solutions
Situation: A CEO is concerned that employees are not taking enough initiative. They keep coming back to him for assistance solving each step in a process rather than solving it on their own or with the assistance of other team members. This takes time away from his primarily role developing and guiding the present and future of the company. What can he do help employees become more self-sufficient? How do you get the best from your people?
Advice from the CEOs:
- Don’t offer to help employees solve the problem or take over the task to save time and effort. Use the “answer a question with a question” technique to let them know that it is their responsibility to develop and complete the solutions and processes on their own.
- Tailor the coaching approach to the particular individual and situation that he or she faces.
- Just let go. Allow them to fly without depending on the CEO.
- Classify frequent problems and solutions into types, and have the team develop solution templates for each type. Provide training on the solution templates so that everyone is familiar with them.
- Select top performers to act as peer-mentors to train and cross-train staff. There are three rewards for their taking on this role: added recognition for their talents, accelerated promotion opportunity, and additional pay or bonuses for their efforts.
- An excellent resource is The One-Minute Manager. It is short, to the point, and offers valuable techniques to encourage initiative and both independent and team problem-solving among employees.
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How Do You Transition to a New CEO? Four Strategies
Situation: A company founder was advised by her Board to help them hire a CEO with more experience to run the company. This new CEO is now in place. As the founder gains more experience, the Board has indicated its willing to consider her as CEO. How do you transition to a new CEO?
Advice from the CEOs:
- Become the fire hose! Build a tight relationship with the new CEO and together build the future strategy that will enable you both to win.
- Others will focus on past issues. Keep your approach and advice positive. Position yourself as a partner, not an adversary. Emphasize your supportive and collaborative capacities.
- Become the new CEO’s go-to person: trustworthy, objective, knowledgeable, reliable. Nurture the development of chemistry with the new CEO.
- When the new CEO asks what needs to be done, produce the plan. Leverage your knowledge and expertise to become his greatest resource.
- Enlist the CEO’s support of one or more of the focused strategies that are already in play within the company. Build the support of the Board and focus on boosting company value to 2x sales. The Board won’t forget who produced the original initiatives.
- You have more power than you imagine – both with the Board and the new CEO – due to your knowledge of the marketplace and the business. Use it wisely.
- While there is a new CEO, the company has already been profitable and company operations are clean. The Board will remember this.
- How do you boost the chances to eventually be named CEO by the Board?
- Tie yourself very closely to the new CEO – be this person’s more important resource. Build and cement your position as his most important ally within the company. It will help you to gain his support for implementing your ideas.
- Segue your relationship with the Board members to become the company’s next CEO.
- At the same time, grow your successor within the company so that you will be ready to move up to CEO when the opportunity arises.
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How do You Minimize Inventory Damage by an Outsourced Manufacturer? Five Points
Situation: A company uses outsourced manufacturing but is concerned about inventory damage by the manufacturer. Tests have been established to assure both visual compliance and functional performance, overseen by a company employee. Still the company is receiving too many unacceptable parts. How do you minimize inventory damage by an outsourced manufacturer?
Advice from the CEOs:
- It is perfectly acceptable for a vendor of consigned materials to bear the risk of product that is not to specification.
- In any contract for manufacturing, require that the vendor carry insurance to cover the full cost of materials and processing in case of damage either during manufacturing or shipping.
- It sounds like this is a new opportunity and situation for the company. In the process they have not guaranteed that both cost and risk are covered.
- There is no point in assuming all this risk.
- For future opportunities like this, take on the work as a time and materials project at an appropriate hourly rate for the market, and with a significant mark-up to cover risk as the project is transferred to a contract manufacturer.
- Another option is to take on the project under a project management contract, and to bill engineering separately.
- This situation sounds familiar for an evolving project. In the future try to unhitch the manufacturing piece from the engineering. Engineering should be more profitable, which will allow the company to more successfully manage the project into early manufacturing.
- Strategically, this could be a good move for the company provided they partner with a reliable vendor to facilitate early stage manufacturing. One option for paying sub-vendors is to pay for yield – particularly if early stage work has a high failure rate.
- If the market opportunity is there do two things:
- Set up an organization with professionals who know early stage manufacturing.
- Be aware this group will have a different culture and approach compared to design engineers.
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How Do You Deal with Management Infighting? Five Points
Situation: A company has two key managers who battle constantly. Recently these battles have escalated. Both people are valuable, but this has become a significant distraction. What’s the best way to handle this situation? How do you deal with management infighting?
Advice from the CEOs:
- Talk to the two people individually. Acknowledge company awareness of the situation and ask what’s going on.
- Listen – make sure you understand what’s going on.
- After you listen, coach. The message: I need you to step up. The company counts on you.
- Both parties must feel empowered by the conversation.
- Focus on behavior only, not the person.
- Make sure that each feels validated but with clear direction to change behavior.
- Acknowledge each individual’s value. Point out the problem, but make it clear that nobody is indispensable.
- At the same time, be firm as to what is expected of individual behavior as well as individual performance. Set the expectation: either you act in a way which does not harm the company environment, or I will take your notice in 30 days.
- If either individual can’t agree to this, then that individual is the problem.
- Revert to guiding principles and values of the company. Raise the conversation to a higher level.
- Establish what the individual wants from the company. Are their needs currently being met? What can be changed to better meet their needs?
- An important end point of the conversation – because both are key players – is for each of them to value the other.
- If, after providing time for the two to resolve their difference, they still can’t make peace with each other, you may have to make a hard decision.
- Be careful – it may be necessary to take a different approach with each individual.
- It may turn out that one individual is the instigator and the other is simply reacting to the first’s provocation. In this case, get a 3rd party to coach each of them.
- Another company recently had this same problem.
- The CEO sat each person down – talked about impact, big picture and what this does to their image in company.
- This worked!
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How Do You Manage Opportunities in This Economy? Five Ways
Interview with Keith Merron, CEO, Avista Consulting Group
Situation: Ongoing uncertainty makes it difficult to clarify strategies going forward. What are the bases for these uncertainties and how do you manage opportunities in this economy?
Advice:
- The world is moving so rapidly that they key to success is differentiation. There is so much information about how to do this that companies start to look similar very quickly. The ability to stand out as different is critical. Ask yourself:
- What is my target market?
- What are the needs that my offer will satisfy?
- What is my unique approach that is distinct from other solutions which meet these needs?
- Once you identify the answers, you need to back these up.
- One has the opportunity to write the future. If you can get one step ahead of the curve this is a huge advantage.
- Products that died were often two steps ahead.
- Successful visionaries see patterns that are emerging, sense what is next, and speak to that.
- Because information is at your fingertips through the Internet anyone can set up a business. The Challenges are viability and sustainability. If these are present the opportunities are huge.
- The web is a place where you can share information. How to monetize this is unclear.
- Once you have a following you can offer things for sale that are valued by your following. When this happens, the potential for fast growth is more available than ever. So is the flip side. If a restaurant gets trashed on Yelp this can kill it!
- In a recession, M&A activity is faster. This enables one to establish a presence much more easily.
- There are many virtual companies. You no longer have to be in the same place to work together! There are also many ways to partner or co-brand via the Internet.
- What’s hard is to create tensile strength in the relationship. Because it is so quick and easy to cobble together relationships, the biggest challenges are creating loyalty and commitment.
- The needs are communications, motivation, commitment and follow-through – just like in a traditional company but in a virtual space. This creates a true bond.
You can contact Keith Merron at [email protected]
Key Words: Uncertainty, Opportunity, Differentiation, Target, Market, Needs, Approach, Timing, Patterns, Visionary, Internet, Following, Community, M&A
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