Posted by The Bowdoin Group on August 17th, 2018
Growing companies consistently grapple with the challenge of when specific C-level executive roles should be added. It’s understandable—there are financial factors, concerns over whether the company will be top heavy, egos to manage, and much more.
In light of that, we often get asked whether there are certain triggers that indicate that they should be hiring a C-Suite executive. It’s flattering, really. They think that as an executive search firm, we have the crystal ball that foretells exactly when the time is right.
We get questions like, “I have a VP of Sales—do I need a CRO? We are operating with a Controller – do I need a CFO as well? Should we hire when we receive Series A funding? Or when we’ve reached a certain number of employees? Or perhaps when we reach a certain revenue?”
Here’s the cold, hard truth: no one can tell you when the time is right to hire in the C-Suite for your company because every company is different. However, after helping hundreds of companies navigate through this very issue, here are three subtle signs that suggest it could be time to hire your next C-level executive.
- Your org chart looks like a three-year old made it – You know what we mean—circles over here, lines over there, dotted lines everywhere. Let’s face it: as your company grows in unexpected ways, you are going to have to hire above people. To avoid tough conversations, we’ve seen companies create org charts around the talent they have instead of what they need. This rarely ends positively and may even become a situation where a confidential search is required. In this tight talent market, when you stumble through describing to candidates why your structure is the way that it is (even as you try to recall why it is that way in the first place), it becomes more difficult to attract new candidates. They can’t see how the vision works out for their own growth. What’s right for one person is not always what’s right for the entire organization, so keep that in mind when you’re creating a simplistic or point-in-time org chart instead of hiring your next great executive.
- An existing C-level executive is in over their head – HBR’s The New Path to the C-Suite explains that “the skills that help you climb to the top won’t suffice once you get there. We’re beginning to see C-level executives who have more in common with their executive peers than they do with the people in the functions they run.” We’ve seen this exact situation happen hundreds of times: a C-level executive builds a company to a certain stage and then the company’s needs outgrow their capabilities. This person could be an excellent scientist, a visionary founder, or a brilliant technologist—frankly, the role doesn’t matter. It happens again and again at the executive level. As the company’s needs change, their role begins to shift and they’re asked to take on responsibilities that fall outside of their realm of expertise. Some do adapt in these scenarios, growing quickly, but more often the reverse is true.
- One of your executives is doing double duty – Similar to the point above but quite different in practice, one of your executives may be taking on two very separate disciplines. Take, for example, one of our clients whose Chief Medical Officer’s scientific chops were second to none. As they grew, the development that a CMO typically handles became more focused on operational and people issues. That’s when they realized it was time to hire a COO. If one of your executive peers is doing work that they are not meant to do, breakdowns will happen. Stay tuned in to your company’s changing needs and hire for the strategic skills that you don’t already have on your team.
Your challenge, as an executive yourself, is to determine your company’s needs for “where we are” and “where we want to be” and explore whether your existing team can fulfill them. That exercise requires resources, certain skills, discipline, time, and an unbiased viewpoint. If you’re experiencing the above issues, or if your future goals don’t align with your current team, it could be time to hire your next leader.
Do these “subtle signs” ring true for you? What scenarios have you seen that indicate C-Suite expansion?