You’re a founder of a growing company and that time has come. You’ve reached that point where you’re wrestling with that question, “Do I bring on a professional CEO, do I stay on in the role, or do I promote from within?”
Let’s take a look at your options:
- Hiring externally
You are happy to let go and you hire a professional CEO and you find that although they’re great at people management, they don’t necessarily share your vision, nor do they have enough of an understanding of your business to be able to continually drive innovation and growth from day one.
There are good professional CEOs out there when you can find them. But the reality is they can be a very expensive hire if you recruit the wrong one. The wrong CEO can completely undo all the growth that you’ve had.
- Stay on as CEO
You recognise that a lot of the success behind the company stemmed from your vision and your technical expertise.
You continue to spend way too much time getting your hands dirty in the everyday running of the business and don’t have time to tap into growth opportunities. This makes the company stagnate.
Here’s the other challenge …
CEO’s often aren’t numbers people. They have very little financial understanding of the key financial levers that drive a company.
They are often reliant on the CFOs. And the trouble with CFO’s is that although they are great at numbers, they have a typical Accountant mindset and simply record the past, instead of focusing on what will drive profitability into the future.
- Promote from within
You have some really talented, middle managers who are great people leaders but they too don’t have the financial literacy to drive expansion in a profitable way.
They focus too much on customer service but don’t have a good handle on the effect that this has on profitability.
The result? Potential profitability suicide.
- The 3 way Tag Team
A great CEO has the following qualities:
- People leadership ability
- Enrolled in the vision
- Thorough technical understanding of the company
- Good financial literacy
Often, it’s difficult to find all of these qualities in one person.
For one of our clients, Nanny SA, we found that the right solution for them was a ‘tag team’ approach.
The General Manager of the company, Maree, has a thorough understanding of the company and its vision. She is also a great people leader.
The CEO, Tanya, is a highly skilled visionary. She has the passion and innovation to drive the company to its next stage of growth.
The missing pieces for them were financial literacy and having the right business model.
I sat down with both Tanya and Maree and improved their financial understanding of the business. I showed them what activities they should be measuring. We also reinvented the business model so it was a good match with where the company was heading.
Tanya is still CEO however Maree is running the company and I’m providing the mentoring to help them keep on track.
The result? It has taken off in a way that was better than anyone thought it would.
Tanya has a formula that works and she can relax knowing her Australian business is under control while she pursues company expansion opportunities overseas. The financial benefits have been dramatic, as well with the company achieving substantial growth, change in culture, and a culture of business growth.
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