Building your company starts by building your team. It turns out that being the coach of the team is more important than being the all-star on it.
Last week I was interviewed by the head of a South African company that focused on helping young entrepreneurs build their businesses. He asked me how I'd advise them. It went something like this:
1. Build the team to execute the strategy.
Earlier this year I was with the new CEO of a small retail store chain. I asked him, "Which of these four basic strategies drives his business: product excellence like Apple, market growth like PepsiCo, operational efficiency like Costco, or financial maximization like Goldman Sachs?" He said operational efficiency first and customer growth and satisfaction second. I then said if he wanted to successfully build his business, he couldn't compromise on the people hired to run these functions.
2. Throw your job descriptions in the wastebasket.
I remember helping a CEO for a midsize manufacturing firm hire a vice president of marketing. His entire management team was there as he handed me the job description to review. After I read it, I crumbled it up and tossed it in the wastebasket. I said, "This is not a job description--it's a person description." I then asked, "What would this person need to accomplish over the next year where everyone in this room would agree the person was successful?" Over the next five years we placed 10 people in his firm using these types of performance-based job descriptions.
3. Hire slow, fire fast.
I think I heard Red Scott give a talk on this theme, but the point cannot be understated. When I first started my management career I had a mentor who told me that I should fire someone within a month or two of taking a new job. It was great Machiavellian advice, since people knew the new kid in town meant business. The flipside of the advice was to spend at least four to five hours over multiple meetings with anyone you're going to hire for a critical position. This was better advice. It led to the writing of The Essential Guide for Hiring & Getting Hired and Hire With Your Head.
4. You'll only be as good as the people you hire.
Last year I met a 25-year-old CEO in the U.K. of a fast-growing marketing company. He asked me, if hiring good people was so important, shouldn't all his managers be graded on how well they hired people? I hugged him.
5. Let go.
A CEO of a rapidly growing fast-food chain asked me to help him hire a few VPs. He just took over the role from his dad. He wasn't sure where to start, so we spent a few hours writing down on a flipchart all of the things a CEO was supposed to do. I then asked him what he liked to do most, what he was best at, and what he didn't like to do. I then said, "Let's find the best people we can to do the things you either aren't best at or things you don't like to do." As a result of this simple idea, the people who were hired felt their jobs were liberating. (Note: The worst CEOs micromanaged and had to have everything done their way.)
You'll never have all of the information you need to make the best decisions possible. The worst thing you can do is procrastinate. The second-worst thing you can do is make an important decision with too little or the wrong information. Balance is the key to making the right decision using "when the decision needs to be made" as the stopping point for gathering information. This decision-making grid will help.
After working closely with 50 to 60 CEOs over a 15-year period, it became pretty clear what the best CEOs consistently do and what the least best consistently didn't do. While a CEO with energy, individual talent, and chutzpah can get a company pretty far, it's the people who are hired who will get the company a lot further.