Founder Lessons from the 2014 Headlines So Far
We are just a few weeks into 2014 and there is plenty of juicy news to digest. We’ve already had political scandals in New Jersey, apocalyptic weather in the Midwest and big deals personnel drama in Silicon Valley. And the month isn’t even over yet! At first glance it might not be obvious what you can learn about your own business from these headlines, but if you dig in a bit deeper I think you’ll see that the front page is packed with lessons for managing your growing company.
Bridge Over Troubled Water
You don’t need to take sides in the Governor Christie drama to see what went wrong here. Whenever a chief executive has to resort to “mistakes were made” you know he’s on his heels and the high ground is lost. You only have to look at Governor Christie’s immediate response to Hurricane Sandy to see how much passion he has and how hard he’s willing to work to deliver results for his home state. But just like a lot of CEOs with similar skills, Christie operates with an in your face, I’m in charge, take control approach to getting things done. This is a very common style for successful individual contributors who often move up the ranks into management roles over their careers. But when you are management, things have to change.
Your team only sees the tough, bombastic exterior; they likely don’t see the nuance in your approach. Out in the market, they start acting the way they think you want them to act – maybe they demean a competitor or pick a fight with a complaining customer. In the end as the CEO, you are the one fighting for your company’s reputation because of your employees’ actions. Be careful about the image you cultivate because your team plays off your cues more than you think.
Hit the Road Jack
Yahoo CEO Marissa Mayer announced in a widely leaked email that her Chief Operating Officer Henrique De Castro was being fired after only fourteen months on the job. No tears for ex-Googler De Castro on this one considering his $100 million severance package but what does this move say about Ms. Mayer’s management style? I say “Good for her.”
The biggest mistake in management is to compound your mistakes by not fixing them quickly. Obviously she didn’t click with Mr. De Castro or he wasn’t effective enough or the company needed a different approach to grow. Whatever the reasons this didn’t work, it is always easier for a CEO to keep a high profile, highly paid star than to admit the hire didn’t work and move in a new direction. I give Ms. Mayer credit for making a quick change even though she’ll be second-guessed for hiring him in the first place or moving on him so fast. One question still remains though, will she show true leadership and take responsibility for the poor sales results or will she blame Mr. De Castro instead?
Baby It’s Cold Outside!
For those of you in the American Midwest, January has been cold. Not like regular cold, Antarctica cold. Ernest Shackleton himself would stay inside by the fire. Travel was snarled for a week as planes stopped flying, trains froze in place and cars were buried under mountains of ice and snow. So what does this have to do with your company?
These are times when you find out about the “edge cases” that can impact your company’s operations. Were some of your employees unable to make it to work and don’t have the capability to work remotely? Did you lose business because of customer or vendor concentration in a certain region? As a CEO of a growing company, it’s important that you encourage your team to think proactively about these scenarios and fix your weak links before they break. If you have soft spots in your supply chain or management capabilities or IT infrastructure that an edge case like this can expose don’t wait until it’s too late to address.
The Search Engine Who Kicked the Hornet’s Nest
Google bought Nest this month if you haven’t already heard! My friend puts Nest squarely in the “niche toys for rich people” category because, really, how many people need a $250 thermostat? Point taken. Add to this the news that they are sold the Motorola handset business to Lenovo for about $3 billion after paying $12 billion just a few years ago. So is Google getting into and out of the hardware business? That’s one question to debate. But there are larger lessons here for you as CEO that don’t require billions of dollars.
Make small bets. Yes, even at $3.2 billion, Nest is a small bet for Google. Spending just 5% of their available cash they just aqui-hired one of the best hardware design teams in the world with deep Apple DNA. They also got into the rapidly growing Internet of Things market with a highly lauded product. And at $12 billion Motorola Mobility wasn’t a bet-the-farm move either. By selling it, they admitted a mistake and moved on. You and your team should always consider adding tuck-in acquisitions, new products, team additions and market adjacencies into your company’s vision and not be afraid to admit defeat and move on. Small bets give you that luxury.
Been Down So Long It Looks Like Up to Me
Isn’t it about time for a little optimism? The economic headlines so far in 2014 are predicting a rosy outlook for recovery, growth and momentum. While most of you will take a cautious approach to fully embracing this new optimistic outlook after years of disappointment, you really should give in to it a little. Crack a smile, get some swagger back in your step and start thinking about the long-term again because every team needs a coach who believes they can win. Give them the feeling that this year is going to be a great one for you, for them and for the company.
And keep reading the news. There is plenty hidden below the headlines.