How To Build Your Senior Leadership Team

It’s a familiar story for most company owners – as you start up your new venture, you’ll be the main driving force behind business growth – a one-person marketer, operations, and finance bod, making all the key decisions yourself.

But as your enterprise grows, you'll find yourself stretched thinner and thinner in trying to assume those same responsibilities. Eventually, you'll find you can't continue to oversee the whole gamut of business functions - operations and sales and accounting and fulfilment and marketing – not if you want to keep your business growing, at least. New executives are now required to take on some of the workflow. Ideally, you’ll find specialists to sit on the board with you and each manage major function of your business, using their technical knowledge and experience to develop their function to a far greater extent than was possible for you on your own.

So, who might you need to hire to build a capable senior team? Generally, a good board is composed of the following:

Chief Executive Officer (CEO)

The most prestigious of corporate titles, and for good reason – the CEO is essentially the boss of everyone, responsible for everything. It’s the role most business owners start with by default, and the title belongs to the person responsible for determining the company’s overall strategy, hiring and building the senior team, having the final say on where money gets spent. An excellent CEO must be able to think strategically, focusing beyond daily details on broader plans, and must be almost clairvoyant in their ability to foresee, and respond to, future trends and challenges. They can’t be afraid of taking risks, and have to be able to make good decisions.

But beyond all this, a CEO must be able to identify the right people to drive their business forward. Having the right management team on board can compensate for a CEO’s shortcomings. They have to be a good judge of character as well as of technical abilities, because both are required to perform well in executive roles. And your CEO can’t be shy about making tough decisions such as firing underperforming staff. How do you know whether you’ll be a good CEO, or whether you’ll need to hire outside? Simple: if you prefer the day-to-day aspects of your business, and focusing on the smaller details, you’d probably be better suited taking a management role and outsourcing a CEO. The CEO role should be for strategic thinkers who enjoy taking a broader perspective on the direction of the business, where it’s going and the people and processes they’ll need to get there.

Chief Operating Officer (COO)

While a CEO takes a broader approach to strategy, the COO’s main role is to oversee a company's complex operational details. He is there to ensure the CEO’s dream can become a reality, ensuring the day-to-day performance figures required are met (or exceeded). Often, particularly where the role is a new addition to a board, he’ll need to figure out exactly what needs to be measured, and then create systems and processes to track those measurements, and plans to respond when the company isn’t delivering.

Being so intimately familiar with the revenue-generating processes of a business make a COO a good choice to train as an heir-apparent to the CEO role, or to split the CEO’s duties with – indeed, this is what commonly happens with large publicly listed organisations. The COO is a broad role which requires someone who revels in measurements, operations and details, but also someone with a strong strategic focus – a tough combination to source.

Chief Financial Officer (CFO)

The clue is in the name for the CFO – they’re the person who’ll handle the money. The CFO’s main responsibilities include creating budgets and financing strategies, and developing the systems which will monitor the financial health of your business. Then they build the control systems that monitor your company's financial health. Based on these systems, they’ll decide what you spend on and what you don’t – which might mean irritatingly (but correctly) insisting that you pay off a loan rather than investing in a shiny new product range. Their primary focus is on cutting costs and ensuring that, when the time is right, you have the finances on hand to expand as you want to.

If you don’t enjoy thinking about numbers – and by that we mean, enjoy it so much that your company’s potential earnings in 2020 are the last thing you think about in bed at night - then you need to bring someone on board who does. Your CFO needs to live and breathe figures and statistics, with a sharp strategic brain and a penchant for taking calculated risk.

Chief Marketing Officer (CMO)

The role of Chief Marketing Officer is one that has become increasingly ubiquitous and important in recent years. The reason is simple: with so much competition for the eyeballs of potential clients in a world oversaturated with information and multimedia, most current business battles are essentially marketing battles. That means the direction your company takes will hinge on the marketing strategy being employed – and that, of course, is the job of the CMO. Modern marketing strategies often include sales strategies too, overseeing everything from the implementation of branding to the development of internal values which define your business’ product or service to the outside world. Ideally, your CMO will know – or get to know - your industry like the back of their hand, dictating the strategy of how to position your product in its market, differentiated from its competition, source distributors, and raising brand awareness and reputation. The ideal CMO will be someone who loves keeping an eye on new trends, can think strategically, and understands the importance of building strong client relationships (rather than being too focused on sales metrics), which will ensure longstanding repeat business, keeping the board very happy indeed.

Finding Your Team Members

While the good news is that hiring the right executive team is the closest thing to a cast-iron guarantee of business success you can get, the bad (and perhaps predictable) news is that doing so is extremely difficult to do at the best of times. High-performing executives are in very high demand, as every business owner worth their salt want to hire the best for such important roles as those at exec level. With executive hires, mass-market ads aren’t the way to go. They won’t reach top executives who, due to the demands of their roles, tend to be extremely busy. They will, however, reach a lot of people who are desperate to find work of any kind, and who will probably end up wasting your time.

Executive search firms offer a solution to this problem, but at a cost. The benefits of employing their services are that they can do the due diligence to present you with pre-screened candidates. This means you can focus on the day-to-day management of your business while they focus on their specialty – sourcing, and attracting, the very best talent ( who often form part of their network). They also monitor the pool of executive talent and can likely reach candidates you couldn't approach on your own. Search firms specialise by industry, function, job, and other criteria, so it’s crucial to find one that you know matches your industry and hiring needs perfectly.

Making The Deal

Once you’ve found the executive you'd like to hire, the next step is enticing them to join your team. Finding the right deal to strike is not easy – while regular, hourly workers may find hard cash a major motivator, executives generally aren't so easily satisfied, demanding stock options, exorbitant bonuses, and often contract flexibility for work-life balance, such as the opportunity to work from home. The best bet here is to ensure that their personal successes are linked to the company’s overall performance – as ensuring the latter’s success is why you hire executives in the first place. To do this, offer bonuses linked to the company’s overall goals of expansion and revenue, and offer stock options to give additional incentives to performance. But ensure that the contract you offer is simple – if it requires complex financial understanding to decipher, it’s not going to be very motivating.

Settling In Your New Executives

Once you’ve found executives that you think can do the job for your business, the truly hard part is next: trusting them. No business owner likes to cede control of their pride and joy, but giving your team autonomy and control over their function is the only way to allow them to make a proper impact and keep them happy. Although your instincts might fight you on this, it’s important to take a step back and trust your hires to do the job: if they didn’t have the credentials or character for the role, you wouldn’t have hired them.

A key part of helping your executives settle in will be to ensure they know what they’ve been hired to do. Early in their tenure, you should agree with them about what their roles are, what deliverables they're responsible for and on what timeframe. Although no-one likes to think about it in the honeymoon period of a new role, it’s crucial that you also agree how disagreements will be handled – because they will occur. From your perspective as a business owner, you hired this person assuming their judgement would be better than yours on a particular function. So, if you’ve hired the right person, their call will be the correct one, even if it’s one you don’t agree with. Make sure you discuss how the call will be made in cases of disagreement so that any conflict will be constructive. Disagreement shouldn’t necessarily be viewed as a negative, either: after all, if you agree on everything, one of you is effectively redundant!

Ultimately, business is about achieving things together that far surpass what you could achieve alone. Your job as a business owner isn’t to reach the goal singlehandedly, but to build a team that is capable of achieving your targets, now and in future. Good leadership is about collaboratively going for the much bigger and better things than what any individual could achieve alone. If you choose your executive team well using the tips we've provided in this article, and then trust them with the autonomy required to get their jobs done, you’ll give your business the surest possible chance of future successes.

If you would like a fresh perspective on meeting your hiring needs in the new financial year, whether at executive level or below, contact us to discover what options are available to you to help tackle the growing competition for the highest calibre A&D talent.