6 Ways New CEOs Can Lead an Established Company Through Change
In many industries, innovation always wins over tradition, regardless of how rich a company’s history may be. No matter who your founders or customers are or what industry acclaim you have to boast, the fact is you’re only as good as your last innovation.
This was the message I had to communicate when I walked through the doors of Avention, a 20-year-old business-intelligence company that had recently undergone a rebrand. The company was going through some big changes, and although the technology team was stellar, the product was strong and the market was hot, Avention was in need of a new leadership team that could reestablish a value system, reinvigorate culture and help the company reach its market potential.
Like any new CEO, my first big decision was where to start. How can a complete stranger walk into an established organization and expect to quickly transform the internal brand? There’s no magic formula, but here is the process that worked for me:
1. Introduce yourself and establish expectations.
When you’re the new guy at an established company, building trust and respect is paramount. Start off on the right foot by taking the time to meet as many employees as possible during your first couple weeks. It may sound obvious but many new leaders get so overwhelmed at the beginning that they forget to allot time for simply walking around the office and shaking employees’ hands. These initial conversations also give you the chance to set clear expectations, both in terms of what employees can expect from you as well as what you expect from them.
2. Open the lines of communication.
As a new CEO, you can spend hours poring over historical documents and financial reports to identify the company’s challenges and opportunities. But when it comes to developing culture and values, the most valuable intel comes from veteran employees. Not only can these people articulate what they think the current value system is but by observing their behavior and questions, you start to gain a clear sense of what (and sometimes who) is missing.
I remember at one of the first town halls I hosted at Avention, I presented some of the company’s financials and immediately noticed that most of the team looked shocked. It was clear that this type of financial information -- good or bad -- had previously been kept behind closed doors. I knew then that the values system we developed would need to emphasize the importance of transparency.
3. Establish values.
When you’re leading a company during a transitional phase, it’s incredibly important to establish clear values that employees can rally around. Some people say that corporate values are the epitome of phoniness and that’s true if all you’re doing is sticking them up on a wall or your website. But it’s important to remember that companies don’t have values; people have values. When you start to think that way, a value system becomes a guiding force for hiring, performance reviews and the way people approach their day-to-day work. Values help ensure that your employees, especially those who may feel jaded, lost or disengaged, have something to stand behind. This ultimately makes it that much easier to attract and retain a world-class workforce, something imperative for any new CEO.
4. Align people with values.
Once values are in place, a new CEO has a clear framework to help him or her build the right leadership team. It’s important to act swiftly, as the people who lead various aspects of the company will be the strongest representation of the internal brand you’re working to build.
One thing I emphasized early on at Avention was the importance of sharing bad news and giving candid feedback -- something that hadn’t been happening before. When I met with current or potential members of the leadership team, I always asked them: “What should I be doing better?” If they said “nothing” or could not come up with an answer, it was a clear sign to me that they did not embody our values. It’s never easy to let people go, especially when you’re the new guy, but the more transparent you are at first, the less surprised the team will be about your hiring decisions.
5. Inspire the team.
Once you have the right team in place, you need to establish structures that will enable the new value system to thrive. At Avention, one of our new values was “A Passion for the Customer.” To ensure that this truly stayed top-of-mind with employees, I had to do more than just tell them it was important, I had to show them. One of my first priorities was to create an incentive program designed to reward all team members -- not just the sales team -- for helping increase renewal rates, promoter scores and customer engagement. This sent a clear message and helped instill relevancy for team members across the company.
6. Seek outside input.
As a new leader at an established company, there’s no question that you’ll have to face plenty of tough decisions during your first few months. Having an unbiased third party who can help you think through these decisions can be invaluable.