Their careers, reputation and sense of pride become inextricably intertwined with their business. This lack of separation has two major negative consequences:
- They stop properly working on the business because they become the business. Therefore to work on the business means to work on themselves – and that is hard for them.
- Their lack of separation from the business means they are unable to elevate their perspective to the level that everyone relies on them to achieve. They fail in their primary accountability to direct and lead their business with full realistic awareness of all available facts.
A solution to this is to challenge themselves to think like entrepreneurs and founders. By thinking like entrepreneurs and founders of smaller businesses, CEOs of more established companies have a mental model to apply that enables them to access a level of self-awareness and corporate introspection that is healthy and necessary.
These are the top 7 ways that CEOs can fail to think like entrepreneurs & founder:
- Nobody else is going to call the business out. You’re the one who has to fearlessly pivot or close. With momentum behind the business this is even harder to do than for a founder or entrepreneur facing failure in the first few years. For every leader who’s been there it’s a phenomenally hard call, CEOs just often have to turn more of an oil tanker with a route programmed into its super computer.
- Remember you’re an entrepreneur. Some would argue that ‘CEO’ skills are learned and entrepreneurial skills forgotten. However, CEOs can never stop being entrepreneurs – if they do they fail their business. They lose the degree of seperation from the entity which is healthy and enables them a ‘thinking gap’. Instead they become just another corporate officer.
- Ask the simple questions. You will sit in many meetings as leader of a business and be privileged because you can ask the dumb questions without fear of condemnation. In Roadmap to Entrepreneurial Success, Robert W. Price suggests entrepreneurs need to ask the really scary simple questions which are at the heart of entrepreneurial management :- What is this venture about? (mission and values statement)
– Where should we go? (goals and objectives)
– How will we get there? (growth strategy)
– What do we need to get there? (people and resources)
– What structure is best? (organizational capabilities)
– How much money does we need and when? (financing strategy)
– How will we recognize the final destination? (vision of success)
- Living inside the customers head. Entrepreneurs spend more of their time there. CEOs should never leave. The Lean Startup method is a good place to go to provide a structured approach to constantly engaging with customers. A CEO of a non-startup can adapt the build/ measure/ learn methodology to be constantly testing what the customer wants. This doesn’t have to be all about new products and services. The evolution of many aspects of your customer facing business operations (support, customer care, new product features etc.) can be driven using this customer-centric methodology.
- The importance of the +1 of talent. Many things hijack a CEO from the importance of the talent mission. Entrepreneurs and founders recognize that each new person (their +1s of talent) into their organisation at an early stage can have substantial impacts on business success. This should never change, regardless of size as these +1s could be your future leaders.
- The evolutionary imperative. Even though the CEO should constantly be 18-24mths in the future, they’re often quagmired in the operational present with the temporary comfort blanket of a relatively mature set of products and services. Even though this can be a common trap for entrepreneurs and founders as well, their lowly position in most of the business food chains means that they have to be constantly fighting for survival (read payroll/ rent/ growth investment etc.) and working out how they need to evolve. Modelling the extinction fear response rather than the ‘hit the earnings target’ fear response will make you look differently at the business you should be leading.
- The importance of real mission and enemies and need for pace and urgency. Again, because of the immature stage of their businesses, good entrepreneurs and founders recognise the importance of instilling pace and urgency in their organisations in order that they may move fast enough to survive. CEOs of larger organisations may feel less of a need to do this as there is less of a need for a survival imperative. What actually happens when you create a real mission above profit or focus the business on wrongs you want to right in the world, or enemies you want to defeat? You align your business behind a common objective which isn’t boring and meaningless to the 80% of the organisation who don’t care about maximising shareholder value or EBITDA.
Avoid becoming inextricably intertwined with your business and failing to achieve the level of separation and perspective expected of you as a CEO. Access a level of self-awareness and corporate introspection that is healthy and necessary by applying the mental model of thinking like an entrepreneur or founder would about your business.
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