Fast-growing young businesses inevitably make mistakes that prove painful, both emotionally and financially.
One way to stumble into fewer such traps is to bring on board someone who has already trodden the path you’re trying to navigate. This is where having an outstanding chairperson can prove incredibly valuable.
For many entrepreneurs, founders and business owners, hiring a chairperson (chair) feels like a massive step. But treat the recruitment of your chair in the same way as hiring anyone new for your business; be as disciplined and strategic as possible.
In practice, that means thinking about where the company is today, where you want to get it to, and the skills and experience that you will need in the leadership team to achieve these goals. Identify where you are currently short in these areas and then look for a chair who can help you close the gaps.
There is no one-size-fits-all solution. A chair who might be ideal for another business might not suit your company at all.
If your growth plan is a buy and build strategy, you may need a chair with extensive M&A know-how; if you’re focused on organic growth, sector experience may be more valuable. And where you already possess certain skills at a senior level, it makes sense to look for something else from a potential chair.
Chemistry matters
Doing this hard thinking should enable you to start pulling together a shortlist of possible candidates for the chair’s role. But cultural fit and a strong working relationship will also be imperative if the appointment is to be a success.
The CEO and the senior leadership team need a chair they can work with.
Defining what you’re looking for here may be more difficult, but simply sitting down with candidates over dinner can really help. You’ll learn a huge amount about each candidate personally, and get a feel for how they interact with others.
Is this someone you can imagine spending time with?
Will you feel comfortable having potentially challenging conversations with them?
Don’t feel that the appointment of a chair has to be conducted differently to other hires. You should certainly take up references, for example. It’s also possible to appoint subject to a probation period – a six-month period of getting to know each other, say, may be valuable to both sides.
And make sure your chair goes through your business’s induction process. Bear in mind too that a chair doesn’t have to be for life.
You may need a candidate to help you get the business to a certain point – a launch into a new market overseas, for example, or through a period of deal-making.
Once these goals have been achieved and new targets set, you may need a chair with different skills and experiences. Don’t be afraid to spell this out upfront.
The ideal chair will make time for the company and its senior leaders. You will want to agree a rough time commitment from your chair at the outset, but you need flexibility.
There may be times where you need a great deal of support and periods that are less intense.
Equally, while CEOs shouldn’t expect the chair to be at their beck and call, the best chairmen do try to fit in with their CEO’s needs – whether that’s calls or meetings at a set time, say, or simply being available at what may be short notice.
Equally, you will need to accept that the chair’s role is to be a critical friend. That means asking challenging questions about the business’s strategy which may sometimes be difficult to hear. Your chair should be supportive and you should feel comfortable bouncing ideas off them, but you also need honest feedback and a realistic view of the business.
Define the practical
For all these reasons, many business founders and owners understandably feel nervous about bringing in a chair for the first time, particularly as companies often make this appointment just as they are raising investment, which is a stressful experience in its own right.
However, keep your eyes on the prize. The right chair can make a huge difference to a business and make life easier for its senior management team.
The chair provides a sounding board for the CEO, who occupies what can often be a lonely position. And they can help the company achieve its goals by avoiding the problems they’ve faced in the past.
One way to get comfortable with a new chair is to set some practical ground rules early on so everyone knows where they stand.
Agree when you’ll hold board meetings – tightly-run meetings once a month often work well – and what other contact you’ll have.
Talk to your investors and senior leaders so that everyone is agreed about the nature of the role. Set out how hands-on you want the chair to be – would you want someone who will attend key meetings with new clients, for example?
Issue a formal appointment letter when the chair joins the company, setting out your expectations.
Finally, for many businesses, additional non-executive directors who will serve alongside the chair – albeit with a lesser role and a smaller time commitment – can add further value.
Even after you’ve appointed a chair, there may be other skills and experience that your business needs, either for a limited period as it strives towards a particular target, or on longer-term basis.
