Tuesday, February 22, 2011

The next day

Over the years, I've participated in many theoretical academic debates over which is more important; the CEO or market. It's similar to the 'nature vs nurture' parable which modern genetics has resoundingly answered (both).

It's true that rising tides lift all ships, but it takes a captain to determine when to sail, as well as choosing the proper port to leave from and to enter. I've come to greatly appreciate CEO's and the myriad challenges they have in the day to day implementation of company plans and strategy development. Coming off a few board and new prospect meetings only highlighted this appreciation. Let me share a few of 'the next day', after the board meeting issues these CEO's are dealing with:

1. The pivot- Six months ago this company introduced its product to the market. A beautiful looking social application which has garnered a fair amount of traffic, but basically zero uptick to a paid version which fuels their 'freemium' business model. Angel cash is getting tight and a new module, enhancing the value of the base solution will race against the clock. Build momentum to attract new capital or shut out the lights.

2. The approach- After working 4 hard years and creating value, this company has been approached to be acquired. The CEO is moderating disparate shareholder interests where some want to defer a sale till greater value is earned, some want to sell now, and a few shareholders are agitating for a large financing round.

3. The team- The CEO hired what seemed like a wonderful senior officer, introduced him to investors and integrated him into the organization. It's six months later and he thinks it's a bad hire; the fit's just not there.

4. The acceleration; or 'what's next'- Business is great, metrics are up, team is happy. But (and there's always a but) all agree we will see slowing growth in the next 18-24 months. Got to find another market or add more value to existing customers. If no solution is found, we should exit soon.

These may seem like distinct issues, but a CEO faces these, and many more, multiple times in a year. If there's a blind spot in her vision, it will surely be exposed and may very well likely maim the company. The best CEO's address the issues rapidly and move on to 'next'.

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