Chapter 18 of the New York Stock Exchange: The Entrepreneur’s Roadmap from Concept to IPO
Who’s on your team? For CEOs, it’s one of the most important questions to consider. The strength of the team determines how well the organization can respond decisively and swiftly to opportunities as well as to challenges. It’s the team’s responsibility to help the CEO formulate and execute a coherent strategy to achieve the company’s objectives. But not all teams are created equal. In our study of the effectiveness of leadership teams, we found that only 25 percent were outstanding, as determined by their ability to serve all their constituencies superbly, while growing in capabilities as a team over time. The remaining 75 percent rated only mediocre to poor.
While our research focused on well-established companies, the findings and lessons learned are highly applicable for startups and other new companies. For these organizations, creating a real team—beyond the core nucleus of the founder(s)—is key to future success. In this chapter, we will discuss the highlights that can help startup companies establish great teams and foster their success over time. We will draw from the lessons and examples of the outstanding teams—what do they have going for them; and examine the struggling ones—what got in their way.
Before launching into the structure and elements necessary for creating a top team, it’s helpful to look at some of the common themes among organizational success
stories. One is getting individual team members to move out of their silos and to function as an interdependent team. These teams are able to advance the leader’s agenda quickly and switch gears when market changes require it. As one CEO noted, his team traditionally had worked very independently. However, the leader recognized that if they had continued in that vein, the company could not have accomplished a turnaround that led to significantly increased revenues, which was due in part to capitalizing on more opportunities once products and services were combined. In effect this transformed the company from a product and services company to a solutions company whose offerings commanded a premium price.
For all companies—large and small, startup and mature—collaboration within the top team is a necessity, not a luxury. “The world is too complex today,” said one executive. “Executive teams, especially in global companies, can’t afford to allow a silo mentality. To think a company can achieve its objectives with individual team members acting in isolation is naïve.”