I have the good fortune of working with a number of great CEOs, executives, entrepreneurs and other business leaders across different industries and stages of growth, giving me a unique perspective on the key traits that make some business leaders more consistently successful than others. Without a doubt, strong character, leadership and management skills, intelligence, critical thinking and structured decision making are absolutely essential for long-term success. However, there is one factor that I regularly see in the truly great CEOs. This is the ability and judgement to discern between being a business operator or a business builder, between working in the business or working on the business.
Given the demands of leading a growing business, it is easy to get drawn into a tactical, short-term focus and lose sight of the strategic, long-term focus. Typically, the most difficult decisions are percolating to the top of the organization, requiring the immediate and full attention of the CEO. In addition, some critical tasks within the company are rightly the exclusive responsibility of the CEO, imbedding the boss deeper into the operations and further away for business design.
The great CEOs handle these tactical activities and never lose sight of their primary role: to design and implement how the business functions, in order to adapt to the changing needs of the market and ensure a continually focus on enterprise value creation. They think at a higher level, and as a business architect, by designing and implementing the right systems, and then ensuring they have the right people and resources to operator the systems. They are consistently stress testing the weakest parts of the business in order to mitigate risk, while investing in the parts that are critical for adaptation, value creation and growth.
Here are four ways to be a great business designer and builder:
- Ensure you are setting aside sufficient time each week to work on the business and make it a strategic priority for the company.
- Think in terms of clear, repeatable and reliable systems that are operated by people, minimize the potential for error and maximize the opportunity for employees to be successful.
- Document your and communicate your business design in a simple but clear way.
- Stress test your business design by tracking errors (particularly those of high severity) and engage a feedback loop to implement permanent corrective solutions.
This dual role of business builder and business operator, does change dramatically dependent on the life cycle and size of the company. However, the fundamental principle applies over time – never lose sight of your role to work on the business as well as in it.
Eamonn has a B. Eng. (Electrical) from Lakehead University, MBA (Finance) from University of Toronto, and has completed Executive Education at Stanford University Graduate School of Business. He lives in Vancouver, Canada. Follow him on twitter @EamonnPercy.