The most delicate battle for a CEO is determining how much pressure to put on operating leaders. CEOs want to give their new hires the space to perform, but also want their leaders to know that results and accountability are essential for success.
Too much bandwidth can give new hires a false sense of security, making them think they have the time, space, and resources to solve business problems. Excessive pressure can create anxiety and stress, resulting in a lack of focus, poor decision-making, and sometimes even a mental disconnect if people's mindset shifts from healthy problem-solving mode to fear and survival mode. This is a tough balance for CEOs, but the right amount of pressure helps everyone perform better, so learning when and how to apply it is an important skill that CEOs and business leaders need to refine.
Below are three parameters that leaders should consider when calculating the right amount of pressure to put on their team:
Time: Always put a performance window on both you and your operating leaders. For sales specifically, this is not a revenue only measurement. For start-up companies, the window can be around “cracking the code" for sales and scale, which may take a bit more time. For marketing leaders, it could be nailing product-market fit and messaging that resonates. For established companies, it may be optimizing towards profitability or margin, which could require a new business strategy or cost-cutting. Regardless of the outcome you seek, clear timelines and expectations, with detailed milestones and objectives, matter tremendously. It takes time to develop a strategy or learn a new market, but too much time is bad for the business and bad for everyone.
Resource Allocation: No matter how profitable the company, disciplined spending, with a detailed eye on resource allocation, needs to always be top of mind. Often I see companies over-spend or under-spend when they are in growth mode. A systematic and strategic approach to spending that unlocks more resources, after milestones are met, will ensure a company does not become bloated with headcount or starved from the lack thereof. Hiring is one of the most important factors for growth, but every new hire needs to have clear expectations and regular check-ins to ensure metrics are being met. When the bank account is full, it is easy to put money against a problem. But more resources can sometimes mask a bigger employee or product issue, so leaders need to always think lean – not cheap – to truly understand what is happening.
Process and Prioritization: A rigorous and systematic approach to prioritization forces hard conversations around what matters most for success. Frequently we see founders and even established business leaders at mature companies working on too many things at once. This puts too much pressure on team members which can result in employees with scattered minds because of a lack of focused direction. Instead, developing a hyper-disciplined approach, with opportunities for reprioritization, will allow the company to move more quickly and ultimately achieve their goals. This is not to say that innovation should be stifled. What this means is that leaders need to be thoughtful about how much time and resources they are allocating to new ideas that could alter priorities. Typically, staying hyper-focused on a well-thought-through roadmap is what achieves the best results.
Whether you are working at a Fortune 500 company, a privately held business, or in a Private Equity-backed organization, pressure is good. Bloated organizations and too much money can lead leaders to lose perspective on their employees and the market which can ultimately be detrimental for any company.
