Like a Virgin: Secrets They Won't Teach You at Business School

SO, YOU WANT TO BE CEO?

There is nothing quite like the early, frenetic days of an ambitious start-up. It’s high-octane and high-risk; the shared experience builds tremendous team spirit and camaraderie that will help your people through some of the company’s most trying times. Your team will seldom work harder than during this period.

The launch stage is also an ideal time for you to decide whether you are suited to the CEO position. While entrepreneurs have the dynamism to get something started, and often create opportunity where there was none, not all of them are good at running businesses. Recognising your own weaknesses is essential to your company’s future.

Once your business matures, it will almost certainly become more challenging to maintain the excitement that accompanied the ‘rah-rah’ days of the launch. It will then be up to you and your team to make sure that employees remain motivated. This is the point at which you will have to make a decision about which role is right for you: entrepreneur or manager?

If you’re hoping to continue as CEO, you must learn the ins and outs of every area of the company. There are no shortcuts-getting this right requires patience and hard work. When Brett Godfrey was CEO of Virgin Blue (now Virgin Australia), he insisted that all senior managers learn every job at the airline, including luggage loading. (I needed to visit the osteopath for a checkup after my stint!) This will prepare you to delegate properly as your business gets bigger. When people come to you with problems, you will be able to provide practical advice based on your first-hand knowledge of how the business works.

You should also sign every cheque and examine every invoice at least every six weeks; you’ll soon know where the money is going, how it moves across your organisation and where it is spent. When you are familiar with the company’s everyday finances, you’ll find yourself asking: ‘What on earth is this cheque for?’ You may be able to cut unnecessary expenditure dramatically. Even at the Virgin Group, I continued this exercise for many years, signing every cheque that went out for one month out of every six, and I ask our managing directors to do the same.

Most importantly, a manager must have the acute psychological know-how to smoothly organise a large group of people and handle the pressures of an ongoing venture. Use the launch period to gauge your own strengths and weaknesses as a leader; ask your best advisers for their honest opinions on your performance. Consider how you inspire and motivate other individuals to cooperate and get the job done.

It takes a certain generosity of spirit to fairly judge people’s merits and limitations, and to trust them with responsibilities. Optimism, openness to possibilities and self-confidence are all qualities of a good manager. Some people are more inclined to these qualities than others-which describe you?

Are you someone who brings out the best in people? Great managers seldom criticise their team members. Just as plants need water, people need encouragement so that they can grow and flourish. An employee who makes a terrible error of judgement rarely needs to be told about it, so instead his manager should focus on helping them learn from their mistake and recover their confidence.

Do you acknowledge your own mistakes and apologise for them? You’d be amazed at how much people appreciate this quality in their supervisors, and how much they can learn from their managers’ experiences. The ability to recognise your own missteps and discuss them is crucial, and requires bravery. If you promoted someone and they are not performing well, you should be able to discuss the problem with the employee, admit your mistake, offer them their old job back and see them through the transition-a difficult conversation and a situation that not everyone is equipped to handle.

Management is also about communicating clearly; explaining why a decision has been taken or in which direction the business is going. Your communications should carry authority without being hectoring or bombastic, presenting a simple vision of what has to be achieved. At the same time, good managers continually question the way people do things and encourage employees to do the same-thereby ensuring they are always ready to adapt to changing conditions.

While a natural talent for the CEO role is truly an asset, many leadership skills can be learned. If there are areas you need to work on, ask yourself who among your circle of friends and colleagues is a leader you can learn from, and talk with that person frankly about your wish to improve. The mentoring experience may be deeply rewarding for both of you.

At the end of this process, if you and your advisers agree that you are suited to the role then you may decide to stay on as CEO and help your business grow. If you perform better in the role of entrepreneur instead, then you need to find a suitable senior manager to take your place. Look for someone who has the above qualities, and, when you find your replacement, give them a proper stake in the business.

Now, it’s time for you to move on and set up your next enterprise. So what’s it going to be?