You're a New CEO, What Do You Do Now?
The myriad challenges facing a new CEO can be broadly grouped into two categories: protecting the business’ present and preparing the business for its future. The best CEOs learn quickly that by balancing strategy and execution, these responsibilities become one and the same. The only way to get from where you are to where you need to be is to align a long-term strategic vision with the actionable, measurable steps that your team executes daily, weekly, monthly, and quarterly.
A recent HBR article on how new CEOs can balance strategy with execution by Millán Alvarez-Miranda and Michael D. Watkins laid out their thoughts on how to do it. Here’s how we think about it at CEO Coaching International using our methodology.
As a new CEO, you can divide the first year of your tenure into three stages that will allow your strategy and execution to develop in tandem:
1. Assess and advance.
Your first couple weeks in the big chair should be all about information gathering. Review the company’s cash situation. Are there any fires that need to be put out quickly? Discuss goals, values, and culture with the owners or board and determine how close the company is to key targets. Talk to your key customers and your employees to get their feedback. List everyone in the C-suite and everyone in a leadership position. Rate them on a scale of 1-10. Who are the superstars? Who can you coach up from a 6 or 7 to an 8 or 9? Being new to the company, you might want to give bad first impressions a second chance. But any glaringly obvious 6s and below shouldn’t be in your future plans.
This snapshot of where the company is right now will determine your timeline for the rest of the year. If this is a turnaround situation, you might need to allocate a full quarter or longer to stopping the bleeding and preparing for a pivot. A cash machine running on all cylinders might be ready for you to hit the gas in just a few weeks.
Wherever the company falls on that spectrum, identify some quick wins that will build positive momentum out of stage one. Modestly increase your weekly sales calls target and incentivize your people to hit it. Hire that buzzy marketing company to give your website a fresh coat of paint. Empower your R&D department to fire a few extra test bullets. Reset the company’s meeting rhythm. Or, if you’re already positive it’s the right move, replace employees who are dragging down productivity with top talent.
2. Think BIGGER.
In most cases, moving from step one to step two isn’t going to be like flipping a switch. Like I said at the top, the best CEOs see transformation and growth as an ongoing process. If your initial quick wins and correctives to best practices are effective, then you’re already moving towards BIG every single day.
With that flywheel spinning, aim a bit higher. Two typical growth targets: expanding your products or services and broadening your customer base. What additional problems could you be solving? What’s an underserved niche in your business space or local community? What do people who aren’t buying from you right now need that they don’t realize they need?
Once you’ve identified a potential growth opportunity, circle back to your assessment of key team members. It’s impossible for any company to maintain an upward trajectory without having the right people on board. “Good enough” may have gotten you this far, but it’s not going to get you any further. If you have any lingering doubts about middling performers, this is the time to make the tough calls and start hiring for the company you want rather than settling for the company you have.
As you start to zero in on the talent you’ll need to take the next step, get specific about skillsets. Work with executive search firms to help you get the best candidates because many of the best candidates are not actively looking for a job. If you’re focusing on an acquisition strategy to ramp up your production capabilities, then you want an M&A expert. Overhauling your sales team? Your next sales manager better be an ace trainer. Does your CMO have the creativity and vision to help you launch a new widget, or is she too comfortable fishing in the same pond? Looking to upgrade your data gathering and analytics? You might need to create a new C-suite position: Chief AI Officer.
Finally, before you and your improved team take the next step, review your cash situation. Even if you are technically in the black, remember: profit does not equal cash, only cash equals cash. If your cash operating cycle isn’t optimized and supported by the right people and technology, you could run the risk of “growing broke.”
3. Step into your future.
At the final stage of this process, new CEOs need to answer the question, “What’s next?” Inside your business, that means reviewing the bullets you fired in the last quarter and deciding which, if any, are worth additional investment. It also means maintaining a consistent cycle of reviewing KPIs, identifying room for improvement, and addressing core reasons for any shortfalls.
Outside the business, CEOs should be constantly scanning the horizon for the next BIG thing. Companies that lack a disruptive mindset are often the first to get disrupted. Hopefully the pandemic experience has given you some added insights on how to spot a transitional moment and pivot quickly on your terms, rather than have a major change forced upon you.
CEO vision is one key to arriving at a sustainable growth strategy. But so is the CEO’s ability to translate that vision into a culture that inspires both top performance and continuous innovation. At the management level, give your executives and leaders real ownership over problems, solutions, and opportunities. At lower levels, show employees a path to ownership or promotion that will increase their buy-in and encourage their best work.
And in your own office, set aside time for learning, reflection, and accountability. Ask yourself, “What are my blind spots? What am I not seeing that my competitors are? How can I be an emotionally intelligent leader who attracts and develops exceptional talent?”
So what happens when you’re running the company you envisioned a year ago? You rinse and repeat.
Go back to step one: strengthening fundamentals, repairing weaknesses, reviewing talent, and matching a 12-month growth strategy to an executable plan that will keep making BIG happen.
About Mark Moses
Mark Moses is the Founding Partner of CEO Coaching International and the Amazon Bestselling author of Make BIG Happen. Mark has won Ernst & Young’s Entrepreneur of the Year award and the Blue Chip Enterprise award for overcoming adversity. His last company ranked #1 Fastest-Growing Company in Los Angeles as well as #10 on the Inc. 500 of fastest-growing private companies in the U.S. He has completed 12 full distance Ironman Triathlons including the Hawaii Ironman World Championship 5 times.
About CEO Coaching International
CEO Coaching International works with CEOs and their leadership teams to achieve extraordinary results quarter after quarter, year after year. Known globally for its success in coaching growth-focused entrepreneurs to meaningful exits, CEO Coaching International has coached more than 1,000 CEOs and entrepreneurs in more than 60 countries and 45 industries. The coaches at CEO Coaching International are former CEOs, presidents, or executives who have made BIG happen. The firm’s coaches have led double-digit sales and profit growth in businesses ranging in size from startups to over $10 billion, and many are founders that have led their companies through successful eight, nine, and ten-figure exits. Companies working with CEO Coaching International for two years or more have experienced an average EBITDA CAGR of 67.8% during their time as a client, nearly four times the U.S. average and a revenue CAGR of 25.5%, more than twice the U.S. average.