The top executive (perhaps the founder) grew the firm to this point, but now seems to be a constraint to growth.

Challenge

As companies grow, complexity grows to the point where one individual (such as a founding entrepreneur) can no longer personally manage everything. Ironically, the founder who created the company may seem like the constraint to its continued success.

To eliminate the bottleneck at the top and refocus the CEO on strategic issues, and to tap all the talent that's already in the organization, the next tier of leaders must be empowered to manage their respective parts of the organization, exercise their creativity, and work directly with one another without the need for day-to-day involvement of the CEO.

However, empowerment cannot mean chaos. Everyone must be aligned with strategies; resources must be controlled; and activities must be coordinated -- functions formerly done by the CEO.

Disciplined business processes must take the place of an individual at the top personally governing resources and coordinates everybody's activities.

How can you install business discipline without destroying the entrepreneurial culture on which the company was built?

Solution

The best place to start is by implementing a business and budget planning process in which managers:

1. Define their group's products and services.

2. Associate all their costs with those products and services (not just direct costs).

3. Agree on the specific list of products and services they're expected to deliver, with a budget matching those costs.

With such a plan in place, the CEO can now measure both results and financial performance.

As an added benefit, the CEO can coordinate activities across the enterprise (without micromanaging leaders) by funding all the products and services from various groups that will be required to execute a strategy.

With both control and coordination in place, the CEO no longer needs to be personally involved in the day-to-day management of the enterprise.

Comprehensive solution....

Other Resources

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