BY MARK FAGAN
With Patrick Gallagher
Having a sound strategy for corporate growth counts for nothing if you don”™t have the means ”“and the people ”“ to implement it.
For a CEO”™s strategy to be most effective, obtaining buy-in from your management group is critical. Why? Because you need your management team to be an extension of you.
Over the course of implementing a corporate strategy for long-term growth, your entire organization must accept and embrace a higher level of accountability and the pressures that go along with constantly trying to raise the bar.
In the old days, obtaining corporate buy-in just meant barking orders, but this is a different generation that responds to a more hands-on, grassroots style of leadership.
As a CEO, your management team is closer to the action than you are, and so you want them to be thinking of ways to solve problems as you would. That necessitates that they buy into this concept ”“ the culture of constant accountability and self-improvement.
Message: Discuss with your management team the key drivers that you feel are most closely linked to your company”™s growth. Establish protocols for monitoring your progress as a company and your employees”™ progress as individuals.
Compare where the company is now to your competitors, or to the industry standard. You can access data on various industry metrics from sources like IBISWorld Industry Research Reports (ibisworld.com) or Integra Benchmarking by MicroBilt (microbilt.com).
Identify areas where the company is strongest and other areas that need improvement.
Most importantly, show management and employees what will happen if those key business drivers are improved upon, how profitability and free cash flow will be affected, and how that can lead to rewards such as increased compensation for those who are shown to be contributing most to the improvements.
Consistency: Creating a culture of accountability takes time. It means having weekly and monthly meetings to discuss and act on key business drivers, and reinforcing the company”™s goals.
Be sure to regularly discuss progress of each key business driver with the management team, taking time to reflect on and reach conclusions over what the data is showing.
Communicate to the management team what you, as CEO, are seeing, and what you would like to see done differently (or maintained) going forward. And then follow up on any directives given to management.
Consistency means having weekly and monthly meetings to discuss and act on the key business drivers. Some topics ”“ such as sales, gross profit, or profits by location ”“ lend themselves to monthly meetings, whereas others ”“ open leads, for example ”“ need to be discussed on a weekly basis.
Keep meeting times, agendas and locations consistent as well, ensure that all of the necessary people are regularly present, start the meetings on time and don”™t cancel except in the case of emergencies. Again, this is all about tone at the top and leading by example.
Accountability: Developing a culture of accountability starts with and must be maintained by the CEO. If employees see their boss lose steam and discontinue initiatives after a short time, chances are, they will follow suit.
The management team and all personnel must understand that reports on the company”™s progress will go all the way down to the individual level, and that there will be accountability for success and failure at that level.
Goals will be set, and compensation, promotions, and careers paths will be driven by this system.
A word of caution: CEOs must be willing to reward the appropriate personnel for successes that increase the company”™s profitability. If there is no upside for them, then buy-in is going to be much more difficult.
Mark L. Fagan, CPA, is the managing partner of Citrin Cooperman”™s Connecticut office. Mark can be reached at mfagan@citrincooperman.com or (203) 847-4068.
