Are you a founder who has built a great business but wants to take a break from the administrative work, or maybe you want to take a step back from leadership and focus on building your product? Either way, hiring a chief executive officer (CEO) to lead the business you created is a difficult task. It will probably take more than a job ad and a few interviews to find the perfect candidate for the job.
Internal succession can be a great way to nurture and hire a CEO. Robert Half reported that 68% of CEOs appointed have been through internal promotion. If you have someone who has been with your company for a long time, and they've been promoted through the ranks, then this is a great way to fill the position of CEO. This person will already know how to run things, will know the vision and will be able to take over immediately or transition into the role slowly. However, the only downside may be a lack of experience as the candidate will most likely not have any CEO experience. If you need skills and expertise which are not be found internally then you may want to look at other options.
You may use recruiters to help you with the search process involved in hiring a new CEO. Headhunters specialise in sourcing experienced candidates for specific positions. They have years of experience in sourcing candidates, a great network and can assist you in your hiring process. The service will come at a fee however you will benefit from time saved and ensure that you have an experienced vetted candidate with prior knowledge and experience tailored to your needs.
You can use an executive search firm to help you find the best candidates for the position. An executive search firm specialises in headhunting therefore it will relieve you of the stress and will source the most qualified candidates for the role.
You can use channels such as LinkedIn and Indeed to advertise for the role or even source candidates yourself for an interim role. An interim CEO is someone who is hired for a specific period of time, to work on a specific project or during a transitionary period.
In 2015, Harvard Business Review reported that firms who appoint interim CEOs have lower returns on assets compared to those who hire a permanent CEO, however, they also reported that interim CEOs focus on short-term goals rather than rewriting the strategy. Furthermore, companies which hire current chairmen as interim CEOs see a lot more success compared to those who hire outsiders.
An Interim CEO may be a good way to reduce your responsibility as a founder without committing to a candidate permanently. It will allow you to assess the skill, character and drive of the interim CEO as well as a culture fit. You may be content with your interim candidate and offer a permanent role or at the least, the experience of hiring an interim CEO may help your search process by ascertaining what kind of CEO you want in the future for your company.
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Hire a COO or a CFO instead
If you wish to hire a CEO to reduce your workload consider hiring a chief operation officer (COO) or a chief finance officer (CFO) instead. This will reduce the burden of responsibility and you will have an employee who you can rely on when it comes to executive decision-making and managing a company's overall operations meanwhile maintaining some form of executive decision-making.
A COO will oversee the company's day-to-day decisions, manage the overall business operation strategy, establish policies and procedures and other tasks. A CFO is in charge of managing the company's finances. Hiring a COO can help you run your company more efficiently, and that means you can reduce the need for a CEO. The COO will take on many of the responsibilities that are typically reserved for a CEO, such as day-to-day operations and financial management. This reduces the amount of work for you as the founder and frees you up to focus on long-term strategy, marketing, or building the product.
Your investors may have recruitment teams or contacts that can help. Investors have extensive networks of CEOs and founders, they may know just the person who is right for the job if they invest in similar fields. If not, they can surely put you in rooms where you can find someone suitable.
Consider expanding your network of companies in your industry. Connecting with other executive professionals in your industry can help you come across senior knowledgeable individuals who may be suitable for the CEO role or know someone who is.
Create a search committee
Consider creating a search committee to assist you with the task. The committee should be comprised of key employees as well as board members who can help with the search process. The committee will be heavily invested in the success of the company and will therefore be a good source of ideas and perspectives which can help to determine if a candidate is the right fit.
A committee can help you set clear expectations for the role. As well as ensuring that the candidate's experience and expertise line up with what you need. They can promote diversity and help to avoid bias when making final recommendations about who should be hired as CEO.
A search committee are an excellent source of information. They are likely to have a deep understanding of the company's culture and mission, as well as its history and current challenges. They may also be able to provide insight into the qualities that make for a good CEO within your organisation and help to filter through the CEO candidates.
A CEO is an integral part of any organisation as they are in charge of creating the vision and leading the company to make that vision into a reality. After you finalise your interview process and decide on your new CEO, the next step would be to send the Employment Offer Letter and the Employment Agreement.
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