Three things every scaling CEO needs to do to be successful

As a CEO of a growing company, you’re accountable for everything that happens – and doesn’t happen – in your organization. Most CEOs take this commitment very seriously, and it serves them well. But the challenge is that many CEOs confuse this with believing they are responsible for everything. 

Even CEOs who have mastered the art of delegation (“getting stuff done”) find themselves overwhelmed by the job of “making sure stuff gets done.” Why? Because their deepest belief is that it’s their job to make sure that results get delivered. This leads them to stay on top of every major workstream and sit in on every business and product review.  These CEOs also spend a lot of time using and tweaking all the management systems designed to ensure stuff gets done: budgets, OKRs, project dashboards, and so on.  

But most of all, it causes them to devote enormous amounts of time to day-to-day problem solving. For many CEOs, problem solving is downright addictive: it’s a sign that they’re still able to add tangible value. It shows they’re not removed from what’s really going on. And it feels good. 

While there is much to admire about this hands-on leadership style, it’s actually a major barrier to scaling. Why? Because if you want to build a truly scalable company, their deeply held belief about the nature of their role is flawed. 

The Limits of Getting Stuff Done

In an organization of say 200 people with a handful of teams, CEOs can maintain oversight of everything important that needs to happen across the business. And there’s no denying that their involvement does help the organization to deliver on its commitments. But, eventually, whether at 200 or 2000 employees, this approach becomes untenable, even for the most energetic of CEOs. Unfortunately, the feeling they get from making sure stuff gets done is so addictive that they fail to make the shift they need to.

This shift is not simply about delegating more. It requires CEOs to define their jobs in an entirely new way: to shift from believing that “my job is to make sure stuff gets done,” to believing “my job is to build the organization that will get stuff done.”  Let’s unpack what this means – and the three skills scaling CEOs need to develop to make it successful. 

Becoming an Organization Builder

The easiest way to visualize the shift is to imagine how the CEO of an enormous enterprise operates – say Satya Nadella of Microsoft. With close to 200k employees and five major business units, there’s just no chance that he could oversee even a fraction of the work that needs to be done. 

But what he can do is to build the organization, and the culture, that can get the job done. This philosophy was perfectly summarized by a client I was speaking with recently who said “Leadership drives culture. Culture drives engagement. And engagement drives performance.”

If you’re a hands-on CEO, you may be thinking – that all sounds great, but will it actually work? To be clear, this approach definitely won’t work if you step back from being a hands-on leader overnight. Instead, it’s a mindset shift that enables you, over time, to develop your org to the point that it will reliably get the right work done without you having to direct or oversee it.  

Here are the three skills that underpin that mindset.

• Learn to be a Two-Eyed CEO
  As we know, plenty of  business problems hit the desk of every CEO.  Customer problems, supply chain problems, product problems. A good hands-on CEO does their best to solve these – and therein lies the problem. They’re only using one eye: the eye that sees business problems as, well, business problems.

  But many “business” problems are really organizational problems in disguise.

  The key here is to learn to look at every business through a different lens – to ask, “is this problem really just the symptom of an underlying organizational weakness or dysfunction?” By opening this second, organization-building eye, you’ll start to see all kinds of ways to improve and strengthen your organization – and thereby to solve these business problems not just once, but forever.

• Build a True C-Suite Leadership Team
  In a small to midsize company, the leadership team is typically composed of strong functional leaders. Their job is simple enough: they just need to build and run their departments to get their work done. That will typically account for around 80% of their time.

  But a company can’t scale when all of its leaders are still ‘in the weeds’ of running their functions or departments. For a true C-Suite exec, the job of building and running your department or function should take little more than half their time. That means they’ll need a layer or two of strong functional leaders beneath them who are able to keep things moving.

  This frees them up to spend the majority of their time on three tasks that are crucial as a company scales: cross functional-collaboration, reinventing and scaling their department for the future, and company-wide strategy and planning.

  In an ideal world, the old functional managers who got you to this point would all develop this capability. But very often they don’t. This creates a dilemma for CEOs: should I stay ‘loyal’ to the exec who got us this far, but who can’t grow further?  Or should I layer someone above them and risk losing them, along with their institutional knowledge and perhaps some of their loyal followers. This is a painful and confusing decision for many CEOs.  But a Scaling CEO knows that there’s ultimately no choice.

• Build an Organizational Roadmap
  A major obstacle to effective scaling is that CEOs are so busy focusing on immediate or mid-term challenges that they have no time or energy to think about the organization they’ll need in the future. And when they do, they typically think forward from the org’s current state – who’s the next hire we need to make? But this limits you to making incremental changes.

  To truly build a scalable organization, CEOs need to think from the future back.  By asking questions like: what capabilities will we need in two years to support the scale, scope and complexity of the business they’re hoping to build?  And which current departments and capabilities will need to be completely rebuilt to scale?

  It’s valuable to get your top team together for a day to develop a vision of the organization you’ll need to support the business you’re trying to build. Then you work backwards and see where the biggest gaps with current reality are.  This results in a roadmap showing what org development moves (hiring, reorgs, training, acquisitions, etc.) you’ll need to make quarter by quarter.

Don’t get stuck just growing  

Scaling is not the same as growing. Growing is simply increasing your revenues and the number of people in your company. Scaling is about building an organization that gets more effective and efficient as you grow; that maintains speed of execution with minimal internal fiction, and results in highly motivated, energized employees. Scaling allows you to maintain the performance and culture that jump-started your success in the first place. Most importantly, it turns growth into a sustainable process that can continue indefinitely. 

CEOs who understand this and can successfully adopt the shift to organization building are the leaders who build truly scaling businesses.

Written by Rob Bier.

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