As the owner and CEO of a small or midsized business, the success or failure of your operation begins and ends with you. But success doesn't just mean earning profits. To truly be a leader, you must strive to improve the welfare of your employees, stakeholders, and others allied with your business by envisioning and implementing a strategy for success. Make the right decisions with the guidance of author Oswald R. Viva, a longtime entrepreneur and business coach, using this straightforward manual. You'll be jotting down notes nonstop as you learn how to: motivate yourself to the best CEO you can be; create a work culture that cultivates achievement; delegate and make employees accountable; improve every aspect of your organization. This guide points you to the knowledge that can help you make the right decisions even in the toughest situations. It's Lonely at the Top, but when you seek out the right guidance and make educated moves, you can accomplish your objectives, become a better leader, and increase profitability for your small or midsized business.
IT'S LONELY AT THE TOP!
A PRACTICAL GUIDE TO BECOMING A BETTER LEADER OF YOUR SMALL COMPANYBy Oswald R. VivaiUniverse, Inc.
Copyright © 2011 Oswald R. Viva
All right reserved.ISBN: 978-1-4620-4653-9Contents
? Preface............................................................................xv? Acknowledgments....................................................................xix? Introduction—The Making of a CEO.............................................xxi? Part One—The Formation or Enhancement of Personal Traits.....................xxvii* Chapter I—Are You the "Right" CEO for Your Business?..............................1* Chapter II—Founding CEOs versus Second CEOs.......................................14* Chapter III—Leadership............................................................28* Chapter IV—Setting Goals..........................................................41? Part Two—Your Functional Development.........................................49* Chapter V—Planning................................................................51* Chapter VI—Organization...........................................................67* Chapter VII—Communication.........................................................96* Chapter VIII—Culture..............................................................112* Chapter IX—Delegation.............................................................119* Chapter X—Empowerment.............................................................132* Chapter XI—Making it Happen: Execution............................................142* Chapter XII—Accountability........................................................156* Chapter XIII—Performance Management...............................................174* Chapter XIV—Systemizing Your Business.............................................185* Chapter XV—Exit Strategy and Succession Planning..................................198* Chapter XVI—Sale of the Business..................................................220* Chapter XVII—Other Subjects.......................................................229? Conclusion.........................................................................251? About the Author...................................................................253? Appendices.........................................................................255* Appendix I—Business Owners' Personal Roadmap......................................257* Appendix II—Exit-Planning Questionnaire...........................................275* Appendix III—Advisory Boards and Coaching.........................................281* Appendix IV—"TEMENOS".............................................................293* Appendix V—The Power of One.......................................................297
Chapter One
Are You the "Right" CEO for Your Business? Evaluate Your Qualifications and Desire for the Job
There are hundreds, if not thousands, of books on leadership, and this book does not pretend to be one of them. This book is intended only as a simple coaching session for small-business owners to evaluate themselves as candidates for the CEO chair. I don't pretend to teach you leadership here, only to have you examine your qualifications for the job.
What Does It Mean to Be CEO?
While the following pages may be perceived as written for the "CEO-to-be," they are mainly intended for business owners who are positioned in the CEO chair. Whether you are in that position or plan to be, you need to understand—really understand—its implications and demands as well as your desires and qualifications. The two main questions you need to answer are: a) Am I qualified? and b) Do I want to be CEO? Hopefully this section will help you answer both.
Have you appointed yourself CEO of your company? Did you do it because you believe you are the best person to lead the company? Or did you assume the CEO role because you started the company and landed the job by default? Because you are the owner, did you claim the position without evaluating your ability to do the job? Have you thought about what is needed to do the job? Do you know which qualifications are required? Do you know which traits you must have? Have you considered—really considered—what the job calls for? Have you created a job description for the position to see whether you qualify? Are you the right person to lead the company to the next level and beyond?
Jack Welch said of leadership for CEOs: "The ideal leader is courageous, strong, persistent, and wise—but what really separates him or her from the pack is passion and vision. It's not enough to be a skilled administrator and world-class manager; no, to be a true leader, you need the passion of your dreams and a vision for how to make them real. Passion and vision are transforming forces that will fail unless you fuse them into a powerful source for change".
So if we accept what Jack said as a real prerequisite of good leadership, as the CEO of your business you must have or develop that passion and vision. If you started your business and built it to what it is today, you have the passion and most likely have a vision, a vision for what you want to do with your business and what you want to get out of it. Consequently, you have the two things Jack demands; now you need to decide whether you have the talent and want to be CEO.
Your Primary Aim
As part of your evaluation where you need to see whether the CEO job is for you, consider your "primary aim" in life. Your primary aim is the vision necessary to bring your business to life and your life to the business, understanding that the business should not be your entire life. (Your business should be part of your life and "apart" from your life.)
Your primary aim provides you with a purpose in life and the energy to work on it. It is your greater motivator and the driver of your business activities. Ask yourself the following:
? What do I value most?
? What kind of life do I want?
? What is I truly love in my life?
? How would I like people to perceive me?
? What would I like to be doing _ years from now?
? What material things are important to me?
? How much money would I need to do the things I wish to do?
? What is important to me?
Don't take these questions lightly; put much thought into them and be honest with yourself. Whatever your answers, they are okay and you should not feel bad about them. The most important thing is for you to be happy and do what you like and have what you like; everything else is secondary, because without your happiness you wouldn't be successful.
Your Development as CEO
Have you thought about the demands and qualifications of the CEO position? Are those demands in line with your goals and what you like to do? Do you feel eminently qualified for the position? A self-analysis is an essential part of the development. You must be candid in answering the following:
What do you have and what does the job entail?
CEO job description: Do you really understand what the job is? Start by writing the job description of your present functions (i.e., what you do every day). Next write (or get help from your business coach to write) the job description for the CEO position. Take action.
Is the CEO position what you really like to do? Identify areas of personal interest for your happiness. Many business owners prefer one of the main activities of the business (technical, operational, sales) but not the administrative, strategic, or visionary demands of the CEO position.
If you feel obligated to act as CEO, you will not reach personal happiness and your business will not reach its potential. Both you and the business would benefit if you were to assume a position of your liking (for example chief technical officer, or CTO) while another qualified person took over the role of CEO.
Analyze your strengths and weaknesses and develop a plan to emphasize the strengths and work on the weaknesses. List your top three weaknesses and work on them. Whenever you consider one of them "solved," add a replacement so you are always working on three weaknesses. Make this a continuous improvement process.
Founding CEOs versus second stage CEOs: Are you capable of taking the business to the next level? Sadly, it is common to find owners who do a commendable job starting a business and growing it to a certain level but are incapable of leading it to the next level; in other words, they reach their level of competence in the business development cycle.
If you admit your limitations, identify your critical level of competence, and concede the CEO position to somebody more qualified, you will drastically improve the chances of your business succeeding.
Are you a leader? Can you become a leader? As explained above and in the respective section, leadership can be developed (to some extent), assuming the natural prerequisites are there. Don't let pride fool you about your qualifications. A coach or your peers can help you estimate your chances of becoming the leader you need to be.
Do you share those traits that define good leaders? Some of the most important ones include being:
? Visionary
? Honest
? Communicator
? Inspirational
? Dedicated
? Magnanimous/modest
? Creative/innovative
? Assertive/decisive
? Influential
Remember that the primary purpose of a leader is to lead others toward a goal.
Management versus Leadership
Many small-business owners realize it is not easy combining leadership and management while at the same time motivating others and working on the business with all its intricacies. One reason is that they are not sure of, or comfortable with, the differences between leadership and management.
There is a big difference between being a manager and being a leader, and as CEO you must be a leader. Owning a business automatically puts you in a leadership position; however, being in that position does not necessarily make you a leader.
As a manager, you can direct people in activities and tasks, but it takes the leader in you to enlist their passion in the work they do and in the business you lead. As a leader, you know that having a sense of belonging increases commitment in their job and thus, you want to make your employees "buy into" your vision.
There is also a big difference between being the boss of a budding or very small company and the CEO of a rapidly growing bigger company. The requirements are different, the responsibilities are different, and the two must have completely different approaches to the job.
Let's look at the basic differences between management and leadership.
Management is a business skill; leadership is a people skill. Management is about coping with complexity; leadership is about coping with change. Management is about planning, budgeting, organizing, staffing, controls, and problem solving. Leadership is about setting direction, aligning people, motivating, inspiring, adapting and creating change.
In your self-analysis, decide whether you prefer to be a manager or a leader. This choice is somewhat misleading because as a manager you must have leadership ability too. So the question really is: Are you or do you want to be the operations type or the executive type? You as the owner have the prerogative to choose your position without affecting your position of privilege.
As we will see you may prefer to be the COO or the CTO or the chairperson and leave the headaches of the executive position to someone else. Of course since it is your business you are still the ultimate decision maker and the most affected by whatever decisions are made by others.
Are You Qualified to Be CEO?
Are you ready and qualified to be the CEO that your business needs to move to the next level? As a coach, I like to do an evaluation of your qualifications for the job. First let's look at your personal traits:
? Do you have the fortitude, energy, and ability to be CEO?
? Are you capable and ready to take the role of leader as opposed to the management role?
? Have you done a good analysis of your strengths and weaknesses and matched them against the needs of the job?
? Have you done a job description for the position and "applied" for the job?
? And most importantly, do you really want to be CEO?
I'm asking the last question because many business owners prefer certain activities not related to the CEO position and dislike others that are prerequisite for the position. For example, it is typical for engineers to prefer to stay involved in the technical aspects of a company; technology has an attraction they don't want to give up. However, as a CEO you can stay in touch, though not intimately so, with the technical side of the business, but you have many other things to attend to. Conversely, they—or many others—may have a pronounced displeasure for administrative functions that are intimately related to the CEO function. Those people (engineers in this case but could also be from other fields) are better suited to hold other positions they would enjoy more.
For the example of the engineers, being the CTO may be a more rewarding position and one that would offer better chances for the company to succeed and for them to be happy.
From My Bag: "OP" was the owner of a manufacturing company with almost ten million dollars in revenues and thirty-four employees and was growing rapidly. The company was part of a highly technical field, and OP was an engineer by education and by heart. He was so involved in the technical side of the business that the company was not performing as well as it should have been, and he was not pleased with having to do "all those menial jobs," as he described the administrative tasks.
I coached him into considering a change of position, and we did some of the evaluations that I suggest in this book. It was not an easy task, as he was reluctant to "take a lower position and have someone else over him" as he saw it, but in the end I was able to convince him. He became the CTO and hired an outside person as CEO. It was a difficult adaptation period, but after some time he admitted he was happier and the business was doing much better. Today as the company approaches twenty million dollars in revenues, he is appreciative of my advice, and the company is doing very well.
I have worked with business owners who are excellent managers but are not the visionary types CEOs are required to be. My advice is to place themselves as COOs (chief operations officers) and to leave the CEO job to more qualified people. Unfortunately in many cases the egos of the owners get in the way, and they can't accept having others in the position they believe should be theirs. I say there is no shame in being what they like to be and in doing what they like to do. Nobody is going to take the main title away from you—owner—and your happiness and the success of your company are more important than titles.
The CEO Job
As CEO your leadership activities include the following:
? Defining and implementing the strategy to realize the vision.
? Defining, developing, and leveraging company core competencies, whether technical, human, market, etc.
? Building and nurturing the culture of the organization.
? Developing, utilizing, and managing resources—human, capital, facilities, equipment, etc.
? Driving performance-based results.
? Leading change and continuous improvement.
? Systematizing (i.e., developing and implementing systems) so the company is "run by systems and not by people" (from The E-Myth).
And as a "candidate" for that position you must ask yourself:
? Am I a visionary and do I think strategically, rather than implementing "the idea of the week"?
? Do I have a tactical mind or a strategic one?
? Do I handle stressful situation well without losing focus and directions?
? Am I good under pressure?
? Am I good at building teams and motivating team members?
? Do I accept the responsibility for problems instead of blaming others?
? Do I practice "the window and the mirror"? (See definition later.)
? Do I set an example of the type of behavior needed to enforce the culture of the company?
And you need to consider shortcomings you may have. Ask yourself:
? Do I always strive for excellence? Mediocrity won't get you where you want to go.
? Am I a good delegator? Failing to see delegation as a critical element of leadership.
? Do I have a life outside the business? Failing to allocate time for yourself and for your family and balancing your business and your personal life.
? Do I assume that because I am good at some skill or trade I am qualified to run a business? It's Lonely at the Top!
Coaching Suggestion: Write a job description for the CEO position. Also write the "job description" of what you do now (whatever your present "job" is); compare the two and see where you need to improve. Another worthy exercise is to "apply" for the job as listed in the job description for your company and see whether you qualify. You will need an independent and impartial person to evaluate your application; your coach would be the right arbiter
Dominant Personality Traits of CEOs
What traits or qualities are expected in a good leader? A number of key traits have been identified over the years that are consistently noted and described as being essential for leadership.
As the CEO of your company you are its leader; as such, you must possess the personality traits that distinguish good leaders. Check yourself against the list below and see whether you have them or need to improve on them.
? You must lead people toward a goal; the goal you created about where you want to take your organization.
? Commitment to your vision.
? Creativity and the ability to implement your creations.
? Ability to inspire others to embrace your vision. As a leader you must "sell" the vision so that it becomes everybody's vision and everyone works to reach it.
? Strategic thinking to clearly recognize your and your organization's strengths and weaknesses, along with the external opportunities and threats.
? In parallel with your strategic side, you must have a tactical side as bottom-line oriented and be obsessed with execution.
? Ability to seek, pursue, and recognize opportunities in every challenge.
? Awareness to be a risk taker but recognizing "safe risk."
? Focus on the job on hand and on long-range issues to guide your company.
? Motivation to succeed and motivate others through persuasion rather than intimidation.
? Emotional intelligence and interpersonal skills.
? Ability to make quick decisions, even with incomplete data.
? Strong values to guide your actions.
? Empathy for others, their needs, and their wants, and the desire to develop others.
? Ability to communicate clearly and to deal with conflict management.
(Continues...)
Excerpted from IT'S LONELY AT THE TOP!by Oswald R. Viva Copyright © 2011 by Oswald R. Viva. Excerpted by permission of iUniverse, Inc.. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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