You’ve worked day and night to perfect your product and risked everything to get your business up and running. Now comes the hard part – stepping back and assuming a strategic role so you can really scale up your company and prepare it for the next stage of its development, be that investment or acquisition.
On the other hand, you might simply be ready to retire or you might be a serial entrepreneur who is looking for the next project. Whatever the reason for the change, the most important decision is also the most difficult – how to choose the right person to replace you as leader of the business so it can really fulfil its potential.
“You might know your sector and your product range inside out, but managing people is a very different skill,” says EJ Packe, managing director of The Supper Club, a membership community of scaling entrepreneurs who discuss issues and learn from their peers at regular roundtables, workshops and speaker events. Its 400-strong membership comprises founders of high-growth businesses from all sectors with sales typically from £1 million to £500 million and average growth of 34 per cent.
“Founding your own business is incredibly exciting, but it can also be quite isolating. We’ve discovered that entrepreneurs really benefit from peer learning and the opportunity to share experiences, problems and solutions with inspirational leaders who are or have been in the same situation,” says Ms Packe.
Upskilling members of the senior management team to step up to the managing director role so the founder can move on to take a more strategic role, perhaps as chairman, is essential. Ms Packe believes that essential to this is the creation of opportunities for all team members to show their true potential.
“We help members share tactics on how to enable their managers to step up. It’s confidential and carefully curated to encourage open and honest insight into what worked well, what failed and why,” she says. “Sharing stories like this provides insights and allows members to learn from each other’s experiences.”
One member, Alex Malcolm, managing director and founder of tailor-made luxury holiday and safari company Jacada Travel, has learnt from other founders how to delegate the everyday management of his company effectively to take a more strategic, long-term view of its development.
I can now devote more of my time to issues relating to strategy and growth, and focus on growing the international business
“The Supper Club’s Director Days enabled my management team to deal much more independently with the day-to-day running and processes of the business, and it’s fundamentally changed us as a company for the good,” he says. “I can now devote more of my time to issues relating to strategy and growth, and focus on growing the international business.”
The best way to choose a chief executive either externally or from within the company, or how to prepare the founder to become CEO, are key areas of peer-to-peer learning among the founders of fast-growing companies.
“It’s essential that the managing director is encouraged to challenge the status quo, and the founder steps back and supports when required. The founder and MD roles must be clearly defined so there’s no confusion or room for error,” explains Susanna Simpson, chief executive and founder of Limelight. “By adopting these principles, I was able to successfully transition to CEO and focus more on vision, growth and marketing, which is what I love doing most.”
Ultimately a successful transition is about empowering a new CEO to make decisions without interference from the founder. This means ensuring the team sees them as the boss. It’s only by removing the founder from the scene that such a transition can take place properly. That’s the hardest part of the whole process, but the most rewarding.
For more information please visit thesupperclub.com
