A transformative executive team includes leaders with the skills, experience, and capabilities to make step-change improvements that significantly alter the trajectory of a business.
“In growing organizations, CEOs often believe that they are the only person in the organization that can envision the future and drive needed change,” says Peter Olmsted, Managing Director at Clark Schaefer Executive Search. “They feel that the weight of the organization is solely on their shoulders and it’s up to them to make all transformation happen. That doesn’t need to be the case.”
Transformative executive leaders share ownership of business outcomes with the CEO, working with them as a team. They also share the CEO’s passion and sense of urgency, helping to lift some of the burden off the CEO’s shoulders.
Smart Business spoke with Olmsted about building a transformative executive team.
When is building a transformative executive team most important?
While every company is unique, there are critical milestones that require a CEO to bring on transformative executive talent. The first is the frustration stage, where a CEO is frustrated because they can clearly see significant growth potential, but the leadership team is incapable of making that growth happen. The second milestone is the danger stage. This is when the organization is struggling, and change must happen quickly, or the business may decline or even fail. The third milestone is the transition stage. This is when a company is transitioning to a new stage in its lifecycle.
One way for a small or growing company to navigate these scenarios and make a step-change would be to add a transformative CFO with best practice experience. That hire could positively impact everything from potential M&A transactions to systems improvements, compliance processes and financial decision-making.
How does a company build this executive team?
Deciding is the first step — the CEO needs to decide if they really want step-change performance improvement. Building a transformative executive team is hard work and sometimes requires difficult, people-related decisions. Many CEOs put off these decisions for years.
When a CEO decides to build a transformative executive team, the next step is to envision what their business could look like with a high-performance executive team. By envisioning how step-change performance improvement will benefit your business, your employees, and your life, you will strengthen your resolve to do the hard work.
Assessing where your team is today is the next critical step — identifying your current and future transformative leaders, and those leaders who can’t or are unwilling to lead change —followed by strategic talent planning. CEOs must map out when specific leadership talent changes will be needed, in alignment with planned business changes. CFOs, especially, can play a critical role in talent planning as they are in a unique position to help manage costs and support the CEO on evaluation and timing of talent investments.
What challenges might companies face when building this team?
The biggest challenge will be to avoid not doing anything at all. Step-change performance improvement requires organizational changes that affect people and are hard to implement. For example, the company’s controller may believe they should be the next CFO. They may be respected for what they do and a longtime key contributor. However, if they are not the transformational CFO that is needed to achieve the vision, it will require having a difficult conversation, while also trying to retain the controller.
The growth of an organization is directly tied to the capacity of the executive team to lead and grow the business over time. A CEO limits growth when they try to be the only transformational leader in the company. An executive search firm can help CEOs identify needs, benchmark against best-in-class organizations, and help build over time the transformational team they deserve. ●
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