What’s The Most Important Thing You Need To Know To Be A Great Startup CEO?
I’ve come to a conclusion in the past few weeks. It’s a stunner. At least to me it is.
What’s my conclusion you ask?
I’ve concluded that I’m a horrible manager. Maybe even the worst manager ever.
Okay. Maybe horrible is too strong a word.
Maybe ineffective would be a better way to describe things.
How did I come to the conclusion I’m an ineffective manager?
I have an over 20 year track record of never being able to rescue and turn around an employee that is failing. 100% failure. Every. Single. Time.
My attempts at saving employees have been incredible flops.
Take the case of “Tom”. Tom was an applications engineer that I inherited when I took over a new division at the company I just joined.
Tom was smart and capable. But Tom just didn’t seem motivated.
So, I spent extra time with Tom to help him out.
I tutored Tom. I asked Tom time and again if anything was wrong. “Nope. Nothing is wrong,” came the reply.
“Tom, you do understand you need to get this work done by Monday.”
“Yes, I do,” was always the response.
Monday would roll around and the work wasn’t done.
“Why didn’t the work get done?”
“I ran out of time.”
“Why didn’t you ask for help?”
“I don’t need help.”
I tried reducing Tom’s workload. The results stayed exactly the same.
I went out for lunch one day. There was a note taped to my computer when I returned:
Tom had quit with no notice.
My perfect record of failure stayed intact. I still had never, successfully turned around an employee.
There was the case of Gary.
Gary was a super nice guy that we hired into sales. Gary had a good track record.
But Gary wasn’t hitting the numbers he set for himself. Gary was going to fail unless we were able to help him.
“I’ll work directly with Gary,” I told our VP of Sales.
It was the kiss of death.
I tried helping Gary every way that I could think of. Gary’s results continued to be poor.
We would have no choice but to let Gary go.
My perfect record of management failure stayed intact. Again. But there’s a way you can avoid my failures…
Do you want to be a great CEO? Hire great employees!
That’s it. And it’s so simple too!
In other words:
- Just hire great employees, and…
- Pay these great employees a fair wage, and…
- Then put these great employees in an environment where they can succeed, so…
- Stay out of your great employees way, except…
- To coach and guide them when they ask for help or need help.
And this is why recruiting and hiring great people is the most important role you have as a CEO.
Maybe I’m just horrible at saving employees that are failing. But, even if you are good at saving employees, aren’t you better off if you just hire really great employees to start with?
Think about it:
- Great employees do the right thing, so…
- Great employees require a minimal amount of management, and…
- Best of all great employees contribute beyond their job descriptions, so…
- Great employees scale as your company scales, so…
- Great employees stick around for the long run assuming you pay them fairly and promote them when they should be promoted.
And it’s so utterly simple. All you need to do is just get out of the way!
All you need to do is create the collaborative environment great employees need to thrive:
The cost of you not recruiting a great team is extreme:
- Your team doesn’t execute as well as you want, so…
- You spend more of your time on lower level issues, and…
- You spend too much time fixing personnel issues (you’ll spend enough time on personnel issues with a great team), so
- You don’t devote the time you need to the long term future of your company, and…
- Your results are not what you want them to be.
Let me give you an example.
I’m working with an entrepreneur named “Peter”. Peter has built his business up to $4M/Year, but his company’s growth has hit a wall.
Now sometimes you have to change your team because you are changing strategies. The problem, in Peter’s case, was the quality of the team.
We started talking about Peter’s direct reports. I asked Peter a simple question:
“Imagine your organization one year from now. Who of your senior managers fits in that future organization, and who of your senior managers doesn’t fit in that future organization?”
Two of Peter’s six senior managers didn’t fit.
“What are you going to do?” I asked Peter.
“I’m going to see if they can scale up. What do you think?”
“I don’t think it’s realistic to expect your team to scale up based on what I’ve heard.”
I told Peter about my perfect track record of failure in turning around problem employees.
Peter had five senior managers that reported directly to him. I asked Peter how many of his team he felt would fit his vision of where he wanted the company to go?
Peter said only two of his five senior mangers would fit his vision for his company.
You can’t execute the changes you need if you don’t have the right team around you.
Peter is going to have to recruit a new team and change strategies at the same time. From experience, I know Peter’s results will continue suffering until Peter is working with a great team.
Imagine if Peter had the right team? Then Peter and his team could move quickly to change the company.
It always comes back to your team.
I started thinking about the successful teams I had built. In each case, the quality of the people I was working with was really strong.
What was my part in their success? The most important thing I did was recruiting the team.
Then, for the most part, I got out of the great team’s way.
The founding CEO of Maxim Integrated, the late Jack Gifford, told me early in my career, “You can’t be a manager if you can’t recruit.” Gifford was right.
Do you want to be a great CEO? Then recruit and build a great team.