One of the more challenging struggles leaders have to work through is the realization that the excellent news of business success is very often followed by the uncomfortable reality that healthy growth requires shaking things up at the top.
Founders who can no longer run it all; Owners who have to learn to focus more on the business than in the business find themselves sharing leadership responsibilities that once were exclusively theirs. This is where healthy growth can become its most cranky. It is also where if you are not prepared you can lose your footing, lose the momentum of success you worked so hard to build.
Embrace that installing a second in command ( or a fresh leader) will serve to boost your success not diminish it. Below are a few articles that address this uncomfortable reality and include a few ideas on how to approach taking the next steps in your organization.
The Vision Thing
By Fred Wilson at brandondonnelly.com
A well-known entrepreneur turned VC, who will go unnamed because I am not sure he would want me to share this conversation publicly, once told me, "If you remove a founder, you must sell the company within a couple of years or it will start to decline in value," I don't' entirely agree with that my experience with it has been different, but it brings up a critically important topic about leadership." I like to keep things simple don't and in my simple mind, leadership comes in two flavors, visionary leadership and operational leadership. Founders are almost always visionaries (if they aren't, run in the opposite direction) and hired CEOs are almost always operators. I like to keep things simple and in my simple mind, leadership comes in two flavors, visionary leadership, and operational leadership. Founders are almost always visionaries and hired CEOs are almost always operators. What this VC was saying is that once you replace visionary leadership with operational leadership, the Company will stop innovating and start to lose value. I agree completely that companies that stop innovating will start to lose value. What I, don't agree with and have seen firsthand, is that you can have a team that can provide both operational and visionary leadership. Leaders who can provide both operational and visionary leadership are a rare but special breed. When you find one, get on their bus and stay on it for as long as you can. It will be an incredible trip. It is also the case that you can pair visionary leadership with operational leadership and I have seen that model work very well for long periods of time. Most commonly, the visionary leader is ""in charge"" and the operational leader runs the business on a day-to-day period. That can be an Executive Chairman (visionary) and a CEO (operator) or it can be a CEO (visionary) and President/COO (operator). Most commonly in this model, the visionary leader is the founder and the operator is a hired executive. Small early-stage companies can succeed without operational leadership but not forever. That is why founders who are great visionaries but weak operationally can be very successful for a while at least. Once a company gets into the hundreds of employees and is headed to the thousands, it needs operational leadership and this is where many visionary founders struggle. And this is when operational leaders are hired and the work starts to find the right long-term sustainable operating model. Some founders are this rare breed of visionaries who can operate too. Most are not. So, this work to find the right pairing is critical and is a lot of the work that board members do with the founders and their leadership team in startups. But going back to my friend and his advice that I started this post with, it is true that operational leadership alone will not get the job done. And it is also true that operational leaders will have a hard time getting "the vision thing" from below. It has to come from the top. Operational leadership, fortunately, does not.
Excerpts from Forbes
Is A Fractional COO Right for Your Business Today?
By John Knotts, Forbes council Member
The right time to hire a chief operating officer (COO) is just before trouble appears in your Company. The reality is that most businesses realize they need a COO too late.
Signs that you need a COO:
• You are spending too much time working in your business and not on your business.
• You are feeling constantly overwhelmed and struggling daily in your Company.
• You know you need to strengthen and solidify your leadership team.
• Your Company needs to grow significantly in scale operations.
A COO — especially your first one — should come from outside your Company. Insiders are typically part of the problems you are facing. They seldom have the required knowledge, skills or experience to make the leap.
The COO Position
A COO is quite different than any other employee in your Company.
Typically, the leader of a company is a visionary. As the visionary, you operate best when you are thinking long-term, generating big ideas, fanning a fabulous culture and cultivating strategic relationships. Without a COO, you become mired in the day-to-day operations, which can cause your business to stagnate, wither and eventually die.
A COO is your team's most valuable player! As your integrator and executor, the COO brings your entire Company together to deliver products and services effectively and efficiently.
The COO is the quintessential "change champion." They define needed changes, lead the change effort, manage the change and even celebrate change success.
Your COO is your closest partner, coach and mentor.
The COO is trusted to seamlessly run your Company when you are not there. They may even be your successor in the future. As a coach and mentor, your COO not only supports your personal and professional business development but that of the entire Company.
Your First COO
When you need a COO, you are looking for someone typically with years of experience and education — much more than most companies can afford for their first COO.
A COO is much more than a highly paid operations manager. However, companies typically make one or all of these three mistakes when they need a COO:
Mistake #1. Instead of hiring the C-suite executive they need, they seek a director or vice president of operations. This saves them an executive salary, benefits, bonuses and perks. People hired in this role are expected to operate at the position of a COO without the title, but normally cannot.
Mistake #2. They lowball the salary of their new COO position. This forces them to hire someone capable of being a director or vice president of operations but who will fail to meet the expectations of a COO.
Mistake #3. The Company treats the COO position as if it were any other position within the Company. Thus, the hiring process, benefits, bonuses and perks all mirror those of most other employees.
The reason companies make these mistakes are because of two things. One, they cannot afford the true talent they need. Two, they do not understand the inherent differences between this position and every other position in their Company.
The first COO is one of the most critical positions to get right. Hiring the wrong COO can cause your Company to significantly struggle.
Consider A Fractional COO
If you cannot afford the likes of what your Company needs, then how do you move forward? You cannot keep struggling in your visionary role while being the full-time integrator.
A fractional COO is a business professional with many years of experience who is willing to work in a temporary capacity, part-time, for an hourly rate that would typically amount to the same as hiring someone full-time. However, you can bring on talent with experience as a business owner, business coach/consultant or former full-time COO without all the costs. Fractional COOs might get paid the same as a full-time COO, but they bring to your Company much more. Plus, there are many other benefits to contracting with a fractional COO.
• Typically, a fractional COO works remotely with your Company. This saves you from creating a separate executive office.
• Fractional COOs do not require an elaborate executive hiring process — thus, you do not have to build separate HR processes for just one position.
• Being a contract employee, the fractional COO does not require executive benefits, bonuses or perks.
• A fractional COO creates a try-it-before-you-buy-it experience, allowing you to kick the tires and determine what you need from a full-time COO.
• The fractional COO is there to work themselves out of a job — they focus on building your Company so you can truly afford a full-time COO in the future, and they can even help you find and hire their replacement.
• If the fractional COO does not work out, let them go — firing an executive can be a grueling situation fraught with cost and legal dangers, but letting a contract employee go is relatively easy.
When it comes to hiring your first COO, do not wait. However, consider whether a fractional COO is right for your business.
Excerpts from Visionary vs Operational Leaders:
by Nancy Foster
Visionary leaders are driven by what an organization can become. They don't get bogged down in details. They are "big picture people" who usher in new eras of innovation and development.
Operational leaders work to ensure that operations are both efficient and effective. This requires understanding a business's goals and objectives and using that to run the business.
Visionary Leaders: 6 Key Qualities Operational Leaders: 4 Key Qualities
Resilience Efficiency Leaders Focus on Quality
Strategic Thinking Leadership Through Management Communications Skills Organizational Skills Focus and Enthusiasm