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: Transition
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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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 Do You Forge an Effective Relationship with a Buyer? Five Points
Situation: A CEO’s Company was recently acquired. She is getting little, if any, guidance from the acquiring company in terms of leadership or management of her former company. What does the group recommend that she do? How do you forge an effective relationship with a buyer?
Advice from the CEOs:
• You’re Lucky: We all wish we had that problem. Many buyers interfere with the operations of the acquired company and make the transition very difficult. This leads to all sorts of problems including employee departures.
• Employee Feedback: Hold an employee meeting, gather their thoughts and concerns, forward those to senior management. This demonstrates a willingness to work with the buyer to forge the best relationship possible.
• Memo: Draft a memo with all of your thoughts, options, and recommendations, send it to the management of the acquiring company and you have satisfied your moral responsibility. No guilt.
• Consult: You may end up consulting to new management sent to you by the buyer to help them figure out how to evolve from practitioners/managers to full-time managers.
• Don’t Worry: The purchase was a good deal to you because you were able to negotiate a favorable deal for yourself and your managers. The future is more a concern for the purchaser than it is for you.
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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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What are Attributes of a Highly Effective Sales Force? Three Points
Situation: A CEO wants to improve the effectiveness of her sales team. As CEO of a young company she faces a choice between using contract versus direct sales reps. She seeks the advice of other CEOs as to what has worked most effectively with their sales approaches and teams. What are the attributes of a highly effective sales force?
Advice from the CEOs:
- Spend time vetting either contract or your own sales reps:
- The choice of contract vs. direct sales reps is driven by market conditions and end desires.
- Utilizing a contract rep is an effective way to gain entrée into the customer. Even though they are 1099s, they must be managed as though they were company employees.
- It is important to spend considerable time vetting candidates for direct sales. Attitude, desire and commitment are much more important than experience and technical prowess. Spend as much time as necessary to make sure that you are hiring the best people. Test them, check references from employers and customers alike. Leave no stone unturned.
- Measure:
- What gets measured get done. Determine what behaviors are necessary for success and develop metrics for these behaviors. This enables you to manage success.
- For one CEO, the biggest challenge is selling above the gap – selling high and wide within the customer organization. Most reps concentrate their efforts on a few people in the client organization – generally low and mid-level people – and fail to establish relationships with senior management.
- It is important, and rare, to have those senior relationships. Getting them requires deep understanding of the customer’s business combined with confidence, determination and persistence.
- Respect and manage reps:
- Many companies treat sales as a “necessary evil,” setting up an antagonistic and ineffective relationship between sales and other departments. This causes the salespeople to hide much of their information or spend time “scamming the system” rather than working as part of the team.
- The best companies treat sales as a revenue engine and encourage, value and respect input from the salespeople. This encourages sales to be part of the larger team.
- There can be challenges transitioning people from a pure product sale to a long term service business relationship – a transition from Hunter and Farmer. Most believe that these are two very different personalities. It may be better having hunters who bring in the business and then transition the customer relationship to account managers to maintain long-term relationships.
- It may be necessary to design two compensation plans to incentivize the desired behavior of each group.
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How Do You Navigate Communication Style Differences? Four Points
Situation: A CEO seeks advice on how other CEOs work with employees who have significantly different styles of communication. He suspects that this is a source of conflict between employees and wants to reduce that conflict. How do you encourage employees to be more open and receptive to other employees? How do you navigate communication style differences?
Advice from the CEOs:
- Conduct regular personnel reviews. In reviews work with the individual to develop personal growth plans in addition to professional development objectives.
- It may be necessary to create enough stress in an interview situation to prompt the real personality to show.
- Recognize that sometimes an employee who meets professional goals can still be a poor fit for the team. This can impact other, productive team members. Don’t be afraid to fire a bad hire.
- How much can you expect to mold another person’s communication style?
- There must be personal motivation to change – the impetus must come from within.
- To prompt the conversation acknowledge that something isn’t working – or isn’t as effective as expected.
- Communicate to the individual that the consequences of not changing are potentially worse than the effort to change.
- Breed adaptive communication skills throughout the organization.
- Use an assessment tool to start the conversation and align tasks.
- In dealing with an individual who is confrontational, probe to determine what is motivating the individual’s question or position on an issue. Does the individual genuinely need additional information or are they using a wall of questions as a roadblock to moving on?
- Work with the individual to organize their answers or input into a plan.
- Communicate values and goals as they pertain to individual contribution and appreciate the impact of different departments’ actions on each other.
- Be flexible – some people need more definition and reinforcement than others.
- Understand that changes and transitions in the company’s focus can shift roles.
- Review each individual’s role periodically to insure that it fits the company vision. This can increase the individual’s understanding of how they are contributing to moving the company forward.
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How Do You Manage Growth? Six Points
Situation: Many companies face challenges managing growth. Growth is a complex process involving strategy, staff and company culture. What guidance can the group give to help guide planning for growth? How do you manage growth?
Advice from the CEOs:
- Think of growth in term of five major components of organization and growth: structural, cultural, facilities, documentation systems, and people.
- Structural
- Consider different ownership and profit sharing options. Look for options that fit the objectives of the company.
- If you are looking at multi-location solutions, develop a structure that can be easily copied in new locations that are added but which is complementary to the home office structure.
- Cultural
- If the business is family-run and looking at moving to a non-family structure, look for options that will preserve the best aspects of the culture as it has developed.
- Keep company values intact.
- Focus on maintaining engagement and commitment.
- Facilities
- The transition from single-site to multiple-site is particularly traumatic. The jump from 2-sites to 3-sites is much easier because an effective model is already in place.
- Documentation Systems
- Growth can compel the company to adopt entirely new systems, especially when passing certain thresholds for government regulations (i.e. 50+ employees).
- People
- Hire and retain for the right mindset – consistent with company culture and structure.
- Specialists can be a real asset for their particular talents, but they seldom have the view of the “big picture” that is required for a turbulent environment.
- Compensation – align compensation with company culture and priorities.
- “Ownership” may have to change from sole ownership to shared ownership in order to keep key talent engaged.
- Add new skill sets to address needs but assure that these complement existing skill sets.
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How Do You Manage a Remote Team? Three Suggestions
Situation: A company just acquired a remote office, including a team that has worked together for years. The manager has 20 years of experience. During the early weeks working with this office, some challenges have developed, specifically resistance to the new reporting relationship. Meeting schedules have been adjusted to accommodate the manager. The principal concern is buy-in from manager’s reports. How do you manage a remote team?
Advice from the CEOs:
- From the discussion, the remote manager has been getting disparate and sometimes conflicting direction from several different people at the home office.
- Meet with home office team. Develop a consistent set of expectations and priorities so that the Manager is not struggling with different directions from different people.
- Consider that in the coming months there will be two business phases:
- Phase A: Business and client transition to the new ownership.
- Phase B: Client maintenance and business expansion.
- Different strategies and objectives will be needed to address each stage.
- Ask for input from the home team on how best to achieve these strategies and objectives.
- Have a discussion with the remote office manager.
- Explain Phases A and B and the focus of each phase.
- Expectations will be flexible during Phase A as business is transitioned.
- In Phase B the focus will be on Team procedures and development.
- Listen to the remote office manager for her thoughts and suggestions on the strategy for each stage and how her team will best meet expectations.
- Similar advice applies to working with remote managers and employees, a situation that has become more common following the COVID Pandemic. Listen to their input and ask for suggestions as how to best achieve their objectives.
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How Do You Position Yourself as the New Leader? Five Points
Situation: A medium-sized company has just been acquired. A long-term employee has been named CEO of the entity. During his tenure with the company, he has established solid relationships within the company and is well-respected. He understands that he is no longer a co-worker but is now CEO. How does he best position himself to both employees and to the acquirer? How do you position yourself as the new leader?
Advice from the CEOs:
- Proactively engage the team in a dialogue about the direction and potential of the company. Focus comments on the positive and the potential of the firm and the combined entity. The acquirer is bringing a new sense of excitement and energy to the firm. They will be looking for key leaders who share their excitement.
- Market yourself to the new owners.
- Develop a list of hopes, desires, and needs.
- Dialogue with the acquirers and learn their hopes and dreams for the combined entity.
- Look for synergies between your and their hopes and desires. Create your own marketing campaign around these synergies.
- Position yourself an essential member of their transition team.
- Select a mentor from the acquirer. Actively seek out their advice and guidance. Use them as a sounding board as you develop your campaign as new CEO.
- The new organization is now just a plan and may be very flexible.
- Ask acquirers about the model that they see. What are their key objectives for the first year? What niche do they wish to fill buy acquiring the company? As the key liaison between the company and acquirer bring value to the transaction.
- When speaking to them, listen for their questions of how they see you fitting into the organization. This will present an opportunity to define your role by addressing their key needs during and after the transition.
- The same suggestions apply to an individual receiving a promotion within the same company.
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