Ben Horowitz recently published a post called “The Sad Truth about Developing Executives.” In it he details the realization that, when he transitioned into the CEO role, his penchant for developing people who worked for him was no longer an asset but a liability. How can this be?
Very early in my career as a software engineer I was continually pushed into management roles. Since I loved slamming code, I resisted each time but eventually gave in because the organization needed a leader. Without formal management training, I learned valuable lessons on my own. The folks reporting to me became my responsibility, and my leadership quickly morphed into serving them rather than vice versa. My modus operandi became creating an environment in which the best and highest skills of each individual could be applied to the task at hand, training them where I could, and then filling in the rest myself in the best way possible.
The model of developing staff members isn’t bad in general, but it can be disastrous for a CEO. Horowitz lists a number of reasons why CEOs shouldn’t pursue it. Here are a few:
- Lack of skill – no CEO understands every job well enough to teach it to direct reports.
- Impact on results – the demands of the market preclude both the CEO and management team members from spending significant time training rather than applying all their effort to achieving targeted outcomes.
- Not paid to do it – “Executives are compensated for their existing ability, and therefore should not be evaluated on their potential.”
- It doesn’t work – the rest of the team will see that you are working with an underperforming player and you will not take him or her seriously because of their lack of acumen.
A serially successful CEO friend has a succinct phrase for how to deal with this a bad hire: “Shoot the runt.” He learned early on that adapting an organization because of one individual harms the organization. The critical responsibility of any CEO is getting the right person into each position, and that may include rapidly correcting a hiring mistake.
After taking over as VP of support services in a turnaround company later in my career, I learned another valuable lesson. One individual in a helpdesk group, we’ll call him John, had been at the company twice as long as his colleagues yet seemed to know half as much. His team received a constant disorganized stream of support calls, so I asked John to act as the dispatcher, taking each initial call, answering simple questions quickly, then assigning more difficult questions to the others in a way that maintained a balance of the number of calls and minimized wait times. I stressed that he had to be available during regular business hours except for his lunch break.
My second week I met with customers all over the country, including both coasts. Each day when I called in to check on John, I heard an excuse for why he got in late or he had to leave early. When I returned, I agonized over the situation for about ten days. Finally one Friday in my first month there, I called John in to let him go. I anticipated that the extremely overworked group would not be happy about losing a hand, but when I told them later that day what I’d done, I almost got a standing ovation.
The next Monday, I was handed a note written by an employee from another part of the company. As I read it in front of my boss, the president, I saw that the author was calling me an ogre for having fired John before I’d even been there a month. When I slowly looked up to see the look on my boss’s face, he smiled as he reached out his hand to shake mine and said, “Welcome to senior management!”
While the latest formula or insight sells business books, most business leaders tend to find their own way, then apply and reapply principles that emerge through their experience.
James Weaver is a serial CEO who’s led multiple companies out of deep holes back to relevance and profitability. He’s one of those gifted CEO’s who quickly finds the right course of action for a failing company and leads the organization to a new and better way to operate.
When I invited him to participate in a book of CEO principles I’m assembling called Shoot the Runt, he suggested a topic immediately. In turning around companies like Gold’s Gym, James developed a mindset and process that encourages everyone in the organization to achieve their highest potential, and he was generous in sharing that process to help the book.
James found repeated success by generating a sense of accountability that drives organizations to new heights of success. Check out the latest CEO/mentor dialog called Mutual Accountability Magic that’s based on the process he’s used successfully multiple times.
Last week, I attended Austin Business Journal’s CEO awards event with Ed Trevis, CEO of Corvalent. The city’s vibrant entrepreneurial scene wouldn’t exist without talented and dedicated CEOs, and an invited group had gathered to honor Austin’s best and brightest.
Brett Hurt, CEO of Bazaarvoice, won the award for large company CEOs. His company recently went public and continues to grow at a rapid pace. Fortunately, I met Brett a couple of years ago and was later able to spend some time in his office talking about his passion – managing company culture.
In the book I’m writing called Shoot the Runt, the latest CEO/mentor dialog illustrates one example of how culture affects success. Each dialog is based on real principles from serial CEOs. I’m very grateful to Brett for providing the concept for this chapter and agreeing to help with the book.
I hope you enjoy the dialog called Lead Through Culture, and as always, your input is appreciated.
If you follow this blog, you already know that I’m accumulating material for a book. It’s a compendium of the wisdom of successful serial CEOs presented in the form of dialogs between a new CEO and his/her mentor.
The latest dialog addresses the question, “Do you really want the CEO job?” and is entitled “Becoming a CEO“. It’s based on discussions with CEO Joel Trammell who has successfully started and grown several technology businesses. He has a unique perspective on how the CEO role differs from any other job and what you need to know before accepting the position.
Other recent dialogs include Market Trumps Execution, and Less is More. The point of publishing the dialogs is to gain more insight, so feel free to share yours in the comments at the end of each chapter.
Here’s the second in a series of CEO/mentor dialogs being published on a web site called Shoot the Runt that will eventually be a book under the same title. This chapter’s about keeping a close eye on what customers are saying about you, i.e. staying in touch with their sentiments about your company.
For more detail about the series, check out an earlier post describing the series. I’d love to hear any comments or suggestions about the dialogs or ideas for the book.
After a long career in high tech that includes a rare combination of C level experience in both large companies and startups, I’m privileged to know quite a few serial CEOs, i.e. those who have led two, three, even four companies to success.
Each CEO has developed principles enabling them to quickly assess a situation and deal with it effectively. Every CEO I’ve approached has been eager to share what they’ve learned so other business leaders can make positive moves and avoid mistakes made by others. I’m compiling these valuable insights into a series of CEO/mentor dialogs (and ultimately, a book) that highlights these principles in an easy-to-absorb format.
The dialogs you’ll read illustrate a single principle from an experienced CEO. While the dialog will be central to each chapter, the book chapters will add a discussion of what it means, plus takeaways and references for further reading. The goal of publishing these dialogs now is to strengthen the discussion portion of the book by drawing on comments and discussions from you and other readers.
I welcome ideas and suggestion for the book, so feel free to email them to email@example.com. Thank you in advance for helping create a useful collection of mentoring advice by adding your own experiences through comments.
Now, here’s the first dialog called, what else? “Shoot the Runt” of course.