Strengthening Leadership
An organization can’t outscale its leadership. Leaders are the load-bearing walls of a building. They are the infrastructure – and, as with construction, you can only scale to the size your infrastructure will support. As an organization grows, it must constantly strengthen its leadership infrastructure to support more growth. When the infrastructure is maxed out, growth will stall – and some of the growth may be lost – through missed opportunities, lost productivity, or turnover.
Today, the landscape of what is expected of leaders is more complex, challenging, and changing than at any other time in history. There has never been a time when Marshall Goldsmith’s title “What Got You Here Won’t Get You There” is more applicable for leaders. Leaders and leadership teams who are unable or unwilling to evolve become ineffective and lose traction.
The challenge is even more intense and formidable for Founder CEOs of high growth companies. Not only is the pace of needed evolution even more accelerated; but also what is needed to remain effective is constantly changing. As you move within and between stages of growth, the skills, traits, and behaviors needed to be successful shift.
Evolution of a CEO’s Role
There are four stages of growth: EMERGE, OPERATIONALIZE, GROW, and EXPLORE & EXPAND. In each growth stage, the CEO’s role becomes almost a brand-new position with new roles and responsibilities - and new skills and behaviors needed.
In our experience, the hardest transition for CEOs is between the Emerge and Operationalize stages.
Success in the EMERGE stage requires a charismatic and adaptable visionary with a passion so alive that it has a gravitational pull.
Visionary: Founder CEO sees the big picture, has a clear vision on how to make a better life for their customers, and can communicate this vision effectively. This ability attracts top talent, helps secure funding, and keeps their team focuses on the long-term goals.
Charismatic: Most effective Founder CEOs have a magnetic personality that allows them to inspire, motivate, and persuade others. A charismatic leader can rally team members, investors, and customers around their vision, fueling the growth of the company.
Adaptable: The first stage of growth is fast-paced and constantly changing. As new opportunities arise, Founder CEOs must be able to pivot quickly. This adaptability often compliments a Founder CEO’s awareness of market gaps and needs - resulting in heavy customization to gain market share. The EMERGE phase often can be characterized by a “sell it and we’ll figure it out” mentality.
The OPERATIONALIZE stage of growth requires something very different. To continue to grow, companies need to standardize their processes and systems to be able to efficiently provide products and services. As standardizing operations becomes a priority, the skills, traits, and behaviors needed in the EMERGE stage can become barriers and must give way to new skills and behaviors. To successfully navigate the OPERATIONALIZE stage, a company must have:
Scalable Processes: Leaders must be able to develop, implement, and refine scalable processes. They need to continually be seeking ways to optimize workflows and eliminate bottlenecks and single sources of failure.
Data-Driven Decision-Making: Operational efficiency requires trackable objectives and continuous measurement of KPIs to identify opportunities for improvement, determine how to best allocate resources, and be able to gain data-driven insights.
Delegation and Self-Sufficient Teams: At this stage, a Founder CEO cannot retain the same level of involvement, control, and decision-making as when the company started. It is critical to delegate and empower teams to take ownership of their roles.
This is particularly true with operations because most charismatic and visionary Founder CEOs don’t possess the skills, traits, or desire to focus on systems and processes. Indeed, working with standardized, replicable processes are almost at the other end of the spectrum from fast-paced, frequent pivoting, and visionary.
The transition to the OPERATIONLIZE stage of growth is often very frustrating to Founder CEOs. Often, some of the frustration comes from not realizing they are entering a completely different stage of growth - and that new skills are needed. They keep doing what has worked so well and find themselves losing traction - or worse, causing disruption among the team.
Even when the need to delegate is recognized, giving up operational control is substantially harder - personally and professionally - than delegating finances or HR.
Strengthening Leadership During the Transition
To strengthen leadership as you approach a new stage of growth, it is important for Founder CEOs to:
Recognize that change is needed: Understanding the separate stages of growth and the things that led to the company’s initial success may not be sustainable or support continued growth is important. It is important to understand what milestones and skills are needed in each stage.
Embrace a Growth Mindset: To successfully navigate rapid growth, Founder CEOs benefit from viewing substantial shifts in the company as opportunities for leaders to adapt and take on different roles and responsibilities. For a Founder CEO, adaptation may mean the development of new skills; but most often when entering the OPERATIONALIZE stage, it means delegating operational leadership.
This is often a very difficult place to be and a difficult decision to make. For Founder CEOs who recognize the need to bring in operational expertise, it is often very difficult to let go. Founder CEOs are wired to do whatever is needed.
When I coach Founder CEOs who are in this stage, I often find them exhausted. They are working harder than they ever have, they have often brought in someone to help but there are challenges, they feel pressure to turn over the reigns of operations, and don’t know what to do.
If you feel like you’re stuck or wrestling with how to navigate this transition, we can guide you through how to navigate the growth gauntlet. For more information, visit our website at www.PeopleCap.com.
