Ten Things the New CEO Needs To Do
You’ve just been hired as the first ‘professional manager’ in a growth company run by the founder. What’s your plan for the first 100 days?
I asked David Patrick to address my Harvard Extension class on this topic. David is well qualified having served as the first professional CEO at Ximian, XKoto and now Apperian. Here’s are his guidelines for CEOs joining founder-run companies (captured in the first person):
1. Get to Work. Don’t show up just to be a manager. Telling everyone what to do is not a full-time job. You need to find a role for yourself to contribute immediately to set an example and build respect.
2. Find a Role for the Founder. The company can’t have multiple leaders. You need to find out what role the founder wants on the org chart. It could be CTO, Business Development, Services, Strategy or a comparable executive role. It’s important to get past this awkward issue quickly.
The worst example of a CEO coming into a founder-run company was John Sculley who joined Apple and then fired Steve Jobs. Sculley acknowledged later that this was his biggest mistake.
3. Make Sure the Founder’s Not Going Anywhere. Some founders may be thinking, “How long do I have here now that we have a new CEO – one year, two years, the length of my options?” It’s important for the new CEO to address this right away. I make it clear: “If you’re not staying, I’m not coming on board.”
The VC’s say that the average venture now takes 9 years before realizing an exit. So I often say to my business partner, the founder, “Remember … 9 years!”
4. Don’t Change the Culture Overnight … but you may have to change the culture. You can destroy productivity by moving too quickly to a more professional business culture with normal business hours. But over time, the new CEO needs to begin this transition.
At one company I had executives from HP visiting and was looking frantically for the founder. There were developers in the office who had been working all night and I couldn’t wake anyone up. Finally someone told me the founder was in his office. It was true – he was asleep on the floor of his office and we could not wake him so we started the meeting without him.
Some of the engineers were in the office for days so I always kept a stack of fresh T-shirts in case we had a customer visit.
5. Don’t Make All The Decisions. I mentor — I don’t make all the decisions. You eliminate ownership by the team when you make all the decisions. Any small company will need to change strategies many times, often returning to the investors for more capital. We all need to share ownership in success or failure.
6. Stay Positive. In the growth stage there are usually eight ways you can be a failure but only two ways to be right. Many days I go into work knowing the deck is stacked against me. So every day I go into the office and think about how we are going to win.
7. Pick Early Goals and Exceed Them. When I arrived at Apperian I defined success as (1) raising money, (2) recruiting a team, and (3) developing a two- year operating plan with deliverables and dates. I wanted to overachieve on all of these goals to give a sense of momentum.
8. Hire “A” Players. I try to hire people smarter than I am. “A”s hire “A”s while “B”s hire “C”s. Hiring is the most critical task for the CEO. The first hire is the most important because it sets the tone – take twice as long on your first hire.
9. Have Some Fun. It’s important to celebrate every milestone without trying to be everyone’s best friend.
10. Have a Supportive Partner. My wife added this. You need to have someone who understands trips with no notice, interrupted dinners and other sacrifices that go along with running an early stage company.
Follow Dave on Twitter: @WDavidPower