| Major Challenges for new leaders of Mid-Market Companies |
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| Written by Stuart Morley MBA |
| Tuesday, 06 April 2010 14:49 |
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The new CEO of a mid-market company has very different challenges when compared to a CEO of a large company. In the larger companies an executive can be groomed for the job over many years, have access to mentors and advisors, but in many Mid-Market companies the CEO is offered the job often with little training or preparation. As a result the new CEO is often surprised by many issues that a more seasoned CEO would not lose any sleep over. For a new CEO of a mid-market company it does not take long before they are drowning in reports, memos, and other insane demands on their time. Then to make it worse, the CEO realizes that much of the information is not reliable and many of the demands on their time are not translating into improving the business. Finally the CEO recognizes that the extra demands of the job are cutting into family life and friends are being ignored making the CEO feel more and more issolated. A good CEO has a built in "spin detector" to weed out those employees are only trying to please the boss and put a positive spin on things rather than telling it like it is. Until the new CEO develops a really good spin detection capability, they need to get out and walk around the office or factory and go on sales calls to hear the "straight goods" from others who are not interest in putting a spin on what is going on. "Decision creep" is another challenge for the new CEO. Employees line up at the bosses office trying to get the new CEO to make as many decisions as possible and free the employee from doing their homework and making the decision themselves. Once the new CEO realized they have fallen into this trap, it is tough to change gears and get employees to make decisions and only involving the CEO when necessary. Often, a CEO will start the day making a list of things to do and, by the time it is done, this list may be several pages long. The challenge is for the CEO to pick a few key things and delegate or ignore the rest. We also suggest the CEO start the list the night before so they can be delegating first thing every morning! As a former employee, the new CEO can often remember how they used to analyze every word and nuance they could pick up from the their former boss and comparing notes with others to see if they were interpreting or misinterpreting what was needed. The shoe is now on the other foot and the new CEO often worries if they will lose the loyalty of employees in a second if they make a careless comment or inappropriate facial expression. However, this phase passes when the CEO realizes the power of constantly repeating messages on a regular basis to reassure employees what is needed. There are very few employees who can be given instructions, and the CEO can relax knowing the work will be done. The new CEO finds they have to spend endless hours following up on the little things that others have promised to get done and yet are still not done. The CEO today is expected by the shareholders, board of directors and staff to be a mind reader and know exactly what customers are thinking and what to do about it. The CEO is often further from the customer and less in touch than the sales people but is expected to have greater insight than the sales people. The CEO is also further away from the daily operations yet is expected to have the all the answers to what is getting done when and where. The pressure to have all the answers grows until one day someone whispers in the CEO's ear that it is ok to say "I don't know - what do you think?" Successful CEOs learn these insights over time but few CEO's are given this information or insight before they take on the job! We find CEOs love checklists of things to consider. When they don't have time to read and interpret stories, they can turn to checklists to guide the discussion and work to be done. However there are some issues, that we call Show Stopper Issues that have the potential to cause a gridlock in any mid-market organization. Some of these Show Stoppers are: when management cannot agree on the future direction of the business; cash flow challenges or the banker is giving the company a hard time; losing key customers or having to drop prices to get customers; as well as issues like struggling to get work out the door on time; losing key personnel and late and inaccurate financial reporting; not to mention the dealing with the day the shareholders decide to sell the business the CEO is running. So for the new CEO, pace yourself. Whether you are verifying the information, building checklists, delegating, following up or overcoming the show stoppers think of the job more as a marathon, not a sprint - and those the show stoppers as you will face a few of them every year you are in the job. About the Author: Stuart Morley MBA is a world renown keynote speaker and advisor to mid-market companies during their tough times. Find more information on mid-market companies which includes video clips, articles and order his recently published book. Grab a totally unique version of this article from the Uber Article Directory |