In a previous piece for Fresh Business Thinking I wrote about the boredom that can afflict company founders once their business is well through the start-up stage and is settling into more of a steady state. How long does this transition take? It depends on a lot of things, but my experience of working with literally hundreds of founders suggests a minimum, in most cases, of five years.
As the founder, there are two roles that you are almost inevitably stuck with. You are the public face of the business, the ambassador if you like, the most high-profile point of contact for customers, suppliers and investors, if you have any. The second role is that of chief strategist, the keeper of the company’s vision and the builder of the business of tomorrow. In times of crisis, both roles come into their own and people will look to you for answers.
If you’re getting bored, or in danger of getting bored, these two features of business life actually provide the opportunity to change your role in the business, to the benefit of both you and the company. That opportunity is for you to shift from CEO to Chairman of the business, typically in a two-stage process: first as Executive Chairman and then as non-executive Chairman. I know a number of entrepreneurs who have made this transition successfully and rediscovered their enthusiasm for the business as a result.
There are two major questions that commonly arise when this suggestion is raised. The first is what does or should a Chairman actually do? My answer to that is to refer to the roles mentioned above. Embrace the opportunity to get out of the office and strengthen or renew contacts with key customers, suppliers and other shareholders. You have a good reason to talk to them – after all, you’re explaining your new role in the business, which they’ll also see as a sign of the business maturing. You can reassure them as well that while you may be delegating, you’re very much not abdicating! You can also use some of your newly-released time to do some serious thinking about planning the future of the business, instead of reacting to events as they arise.
The second question that typically occurs is “how do I prepare for this new role?” This is the ideal time to get some experience as a non-exec, sitting on someone else’s board. Watch and listen to start with. Over time, as you understand more about the business, my guess is that you’ll be surprised by how much you didn’t know you knew [to paraphrase Donald Rumsfeld], and how that translates into useful insights and advice you can bring to the table. As an outsider unencumbered by all the baggage that stops the founder seeing the wood for the trees, you’ll also discover how much easier it is to run somebody else’s business! And a fair amount of that new insight and clarity can nearly always be brought back to be shared with the executive team that is now running your own company.
Which brings us neatly to the question of recruiting your successor as CEO, once you’ve made the decision to step up to the Chairman’s role. Some thoughts on the do’s and don’ts of this process will feature in the next piece.
By David Molian, visiting fellow, Cranfield University