The biggest decision you will make as CEO is who is on your leadership team. Here is how to make sure yours will boost you up, not drag you down.
As a company grows, so do the leaders of the business. And nobody needs to grow and change more than the CEO. In the early stages of the company, a CEO needs to focus on understanding customers, designing products and services, and selling solutions to the market. However, once a company gains traction and begins to grow, the CEO needs to shift their focus to designing and building the organization and culture.
The most important part of this process is creating the company's leadership team. These are the functional heads that will expand and manage the different parts of the business. The team's ability to think strategically and execute with confidence and efficiency will be the driving force to the company's success.
As a business advisor and executive coach, I've worked with dozens of CEOs helping them build and grow their team as they scale their company. When deciding who to bring on, these are some of the important questions I ask.
1. How well do you know yourself?
Before you start selecting who will be on your team, it's critical that you step back and look at your own strengths, weaknesses, style, and habits. The best CEOs are highly aware of their own shortcomings and blind spots, and they make sure that the team they build will round them out and help cover bases they can't.
2. What are the limits of your knowledge and skills?
Many times, I've been brought into a company to work with the leadership team only to discover that the CEO has built a team of "yes people." They add nothing to the conversation and only look to curry favor and avoid criticism. Great CEOs have the confidence and humility to surround themselves with people much smarter than they are. This will expand the capabilities of the team and deepen the team's experiences and insights.
3. What will help you in the future market?
Another consideration is what market understanding or experience will benefit the team. Choosing executives who have been in other companies or have worked in a particular industry or market can be extremely valuable if you lack knowledge or history in a critical area. Bring in people who have "been there, done that" so you can avoid common mistakes.
4. What are the limits of your experiences?
When putting together a team, make sure that you have a range of backgrounds. If everyone's coming out of a startup, you'll have a blind spot for mid-market challenges. Bringing in people with backgrounds in small and large companies will give you different perspectives. Also consider things like products/services, sales cycles, market maturity, and geographies and/or cultures.
5. Where can you increase gender, ethic, and cultural diversity?
You also want your team to have a gender balance and diverse background. A 2015 McKinsey study found that teams who had more ethnic and racially diverse leadership teams had 35 percent higher returns and that teams with greater gender balance had 15 percene higher returns. Creating diversity at the top will more likely drive diversity throughout the organization.
6. What is your natural thinking style?
Another area that diversity is important is thinking style. If you're a shoot from the hip kind of CEO, they you'll want to balance that out with some cautious and analytical thinkers. And while these people may drive you nuts at times, they might also save you from a rash decision that could harm the future of the company.
7. What are your core values?
While diversity in gender, culture, and thinking style are important, you don't want people who have radically different personal or ethical values. Be sure to articulate your company values and your personal values and surround yourself with people who are well aligned with them. If service to the community is important to you and your company, bringing in someone at the top who has never volunteered a day in their life will cause friction and undermine trust.
Creating a great leadership team is not easy. It takes critical thinking, excellent recruiting, and hard decision making. It also takes time and patience. Done wrong, it can lead a company unwittingly down the wrong path and hinder growth. But done right, it can boost a CEO and elevate the company to higher and higher levels of performance.
This article was originally published on Inc.com: https://www.inc.com/bruce-eckfeldt/great-ceos-surround-themselves-with-best-leadership-team-heres-how-to-create-yours.html