Is your leadership team still effective during COVID in protecting and building your company value
I’ve been having frequent dialog recently with business owners that are seeing their leadership teams in a new light, the light of a crisis. For some, they have a CEO exhibiting the right leadership qualities and experience to navigate this crisis. Unfortunately for other business owners, their CEO that was able to lead the team during “normal” times is not exhibiting the needed leadership during this crisis. What I’m seeing with most of these business owners is they need to step up their leadership and articulate more clearly what their expectations are for their CEO’s now.
Early in my leadership development years, I had a boss say to me that true leaders know how to lead effectively during normal times and equally as well during times of crisis. But because so few have truly experienced crisis, they turn out to be inexperienced and potentially ineffective when the crisis hits. This ineffectiveness can harm your company worth for the short and long term.
If as a company owner you find yourself in this current mindset of losing confidence in your company CEO, here is the dialog you want to be having now so that your expectations are clear:
- Analyzing the current business performance – convey to your CEO that you expect them to truly understand how COVID is impacting your business, not emotionally but through data and facts. Are they effectively using data (i.e.: new customer purchasing patterns) as a friend to help convey where your business has changed and may be changed permanently?
- Making the tough decisions around costs – convey your expectations around your CEO making the really hard decisions to adjust the operating cost structure of the business. Are they just letting variable costs make the natural adjustments they make as a business ebbs and flows? (example: your material purchases are lower because your revenue is lower or your team is traveling less to see customers so T&E expenses are down). Or are they taking the hard look at fixed costs as well to truly protect your margins? Are they looking at indirect labor, not just direct labor? Are they looking at office positions to see which could be consolidated? Are they looking at processes to find opportunities for improvement and cost out?
- Providing strong leadership to employees and customers – convey your expectations for how your company is communicating with employees and customers (even suppliers) during this crisis. Are you pleased with the quantity AND quality of the communications your company is providing to all stakeholders.
- Protecting your company value proposition – convey your expectations regarding any changes your company should or shouldn’t be making to the overall value you bring to the market. How do customers view your company in terms of the value you deliver and your uniqueness versus competition, is your CEO managing this effectively during this crisis?
- Planning and forecasting effectiveness – convey your expectations around the types of planning you want taking place now and what business projections or forecasts you want to be monitoring. Although you want your CEO looking in the rear view mirror during this crisis to understand what your customer data is telling you, you want them also looking out the front windshield and developing their crystal ball of business projections so you can be confident that your resource planning (materials and labor) are being done effectively to protect, even build the worth of your company.
If you are pleased with how your CEO is navigating this crisis, make sure you clearly let them hear this feedback. If you see gaps, especially in these areas above, show your leadership and convey your thoughts and expectations clearly. And if you don’t feel comfortable or confident having these types of dialog, turn to a member of your Board or engage with an advisor who has the CEO operating experience to be able to hear your expectations and effectively coach your CEO. As the owner, it’s also your job to protect and build the value (or company worth) even during a crisis. Decide now if you think you have the right leadership team in place to help ensure you one day receive a euphoric valuation upon exit!
