Growth is a double-edged sword. Success provides the opportunity to grow. Growth is a reward for hard work and success. And yet, growth is hard. It often requires a new focus, new leadership, different skills, and possibly a new structure. As CEO, you are tasked with building a new, larger company while continuing to run the company that currently exists. The downside to growth is that it comes with significant risk; because so much has to change, you can’t just go back to the way things were if the change is not successful. In many ways, growth is an all or nothing endeavor – it is critical to get it right.
This dynamic becomes even more complex when the growth is backed by investors who join your Board.
You’ve been doing fine. The company has been successful under your leadership. Indeed, the company has been so successful it has attracted investors. Now there are new people in the mix – potentially with new ideas, perspectives, and expectations. And they may have different philosophies and ideas about an exit strategy.
There are often a lot of unknowns, assumptions, and some anxiety – which lead CEOs to initially keep investors at arms-length: giving them only the information they request through one-way presentations at Board meetings. As a result, the only way for the Board to be involved is to ask questions about the reports which is often frustrating and leads to a defensive reaction. In turn, investors feel stonewalled when they don’t have visibility into the business, and ask more questions.
If you are currently in this spiraling cycle, it is imperative that you get out of it – both for the business and your own future.
One of the most important things you need to remember as the CEO is: You don’t have to do it all by yourself. Your Board is an incredible resource. Involve them. They have financial and business acumen, perspectives, and experiences (both successes and failures) that can significantly broaden your ability to be successful. They don’t have, however, your expertise and experience in the company and with your customers that you do. The company needs both. For a company to reach its full potential, it needs the benefit of everyone’s expertise, insights, and wisdom. It is also critical there be a trusting partnership between the CEO and Board.
The simplest and most effective way to build a trusting partnership with your Board is to involve them. In Board meetings, structure the agenda to leave significant time for discussing strategic issues. Send out data reports in advance so the limited time the Board has together is not consumed with presenting out information. In advance of the meeting, identify a few strategic decisions / challenges that are on the horizon, and then use the meeting to involve and engage the Board in a strategic brainstorming conversation.
Between Board meetings, involve your Board members as thought partners. Float ideas and ask for their input. Your Board wants you to succeed, and they do not expect you to have all the answers. It is ok to ask for their help or guidance – with specific issues, with how to manage the Board, or how to be the best CEO you can be.
If your relationship with your Board is strained to the point that involving and being vulnerable with your Board seems like crazy talk, we can help you break through existing barriers to build a trusting partnership.