Marshall Goldsmith's Blog, page 3

This week’s question for Ask the Coach:

What can I do to build my confidence in my capabilities as a leader?

You won’t get to the top without self-confidence; to build it, you have to believe in yourself. Don’t worry about being perfect — put up a brave front and do the best you can. That’s it in a nutshell. Here’s a little more background for you.

Last year, as I often do, I taught a seminar for MBA students at the University of California at Berkeley’s Haas School of Business. A second-year student approached me and told me he’d read my book What Got You Here Won’t Get You There. “In the book you talk about classic challenges faced by your clients,” he said. “I noticed that you never discuss self-confidence problems. How do you deal with your client’s self-confidence problems?”

This question really made me think. I rarely encounter self-confidence problems in my work with CEOs and potential CEOs. It is almost impossible to make it to the top level in a multibillion-dollar corporation if you do not believe in yourself. On the other hand, I am frequently asked to speak at business schools, and I have noticed that students in my seminars often want to talk about it.

This is such an important topic. I thought I would share a few suggestions about how you can build your self-confidence. I also hope you, my readers, will offer your own suggestions.

1. Don’t worry about being perfect. There are never right or wrong answers to complex business decisions. The best that you can do as a leader is to gather all of the information that you can (in a timely manner), do a cost-benefit analysis of potential options, use your best judgment — and then go for it.

2. Learn to live with failure. Great salespeople are the ones who get rejected the most often. They just ask for the order more than the other salespeople. You are going to make mistakes. You are human. Learn from these mistakes and move on.

3. After you make the final decision — commit! Don’t continually second-guess yourself. Great leaders communicate with a sense of belief in what they are doing and with positive expectations toward the achievement of their vision.

4. Show courage on the outside — even if you don’t always feel it on the inside. Everyone is afraid sometimes. If you are a leader, your direct reports will read your every expression. If you show a lack of courage, you will begin to damage your direct reports’ self-confidence.

5. Find happiness and contentment in your work. Life is short. My extensive research indicates that we are all going to die anyway. Do your best. Follow your heart. When you win, celebrate. When you lose, just start over the next day.

I hope you will you share your suggestions for building self-confidence with me and with each other by sending comments. Thank you!

This is second of two columns in which I address, in collaboration with my good friend and colleague, Dr. Steven Berglas, the unique challenges that entrepreneurial family businesses builders face in leadership succession. The first post describes how entrepreneurial founders can unwittingly sabotage the succession process.

Entrepreneurs who create and build businesses from scratch are nothing if not street smart. They know business, as well as the trends that impact businesses. I am not...

This is second of two columns in which I address, in collaboration with my good friend and colleague, Dr. Steven Berglas, the unique challenges that entrepreneurial family businesses builders face in leadership succession. The first post describes how entrepreneurial founders can unwittingly sabotage the succession process.

Entrepreneurs who create and build businesses from scratch are nothing if not street smart. They know business, as well as the trends that impact businesses. I am not...

This is second of two columns in which I address, in collaboration with my good friend and colleague, Dr. Steven Berglas, the unique challenges that entrepreneurial family businesses builders face in leadership succession. The first post describes how entrepreneurial founders can unwittingly sabotage the succession process.

Entrepreneurs who create and build businesses from scratch are nothing if not street smart. They know business, as well as the trends that impact businesses. I am not certain that all successful family business founders know this statistic: most (60-70%) of all family businesses that lose a founder to retirement or death are sold or liquidated — i.e. not passed on to the founder’s heirs.

Many theories attempt to explain why entrepreneurial ventures fail to thrive under the stewardship of a founder’s heirs. Most pin it on the loss of founders’ charismatic leadership and their personal devotion to the business. Assuming this is so, the fact that so many founders fail to prepare for the life of their “other child” — the business — after they are gone is very unfortunate.

My last post examined some of the most important factors responsible for this anomaly. This post will provide suggestions to founders who are facing succession. Our goal: To prevent the ancient Chinese adage about family firms — Shirtsleeves to shirtsleeves in three generations — from proving true.

Given the devastation brought upon an entrepreneurial venture that has not prepared for a founder’s departure, I advise all business founders to follow the procedures outlined below as soon as possible, even if they have no intention of retiring before age 99. It’s an ounce of prevention that is worth infinitely more than a pound of cure.

The first step in preparing for an entrepreneurs’ passing the baton involves adjusting their perspective vis-à-vis the leadership role they have held:

In preparing for transition, founders first need to face the reality of the personal dependence that their companies — and their families — may have on them. Founders need to begin managing the practical implications of departure long before they leave the business.
If founders plan to pass the baton of leadership to their children, they need to realize that this may well become not only a financial drama but also an emotional drama. Surprising heirs and potential leaders after the death of the founder is a terrible idea. Founders need to have thorough communication with family members about both who is going to do what as well as who is going to get what before the actual transition occurs.
Founders need to pick a successor before they leave, and not put off this difficult decision until the last minute. This can be especially tough for parents, who have to balance their desire for the future success of the business with their desire for the future success of their children.
Founding parents need to get objective third-party advice during the selection process. Even if the selection decision is made, it can be hard for parents to realistically assess the developmental needs of their own children. We have seen founding parents be both unrealistically positive — and unrealistically negative — about their children’s potential for leadership.
In some cases, eternal advisory boards may facilitate the succession process. Even though the founder may make the final call, family members may be more likely to accept the decision when external advisors make the recommendation.
Parents and siblings need to be aware of — and avoid whenever possible — a common problem that Dr. Berglas defines as splitting. Splitting occurs when family stakeholders may go to Mom if they don’t like what Dad is doing (or vice versa). They may also go to siblings and develop “sides” that end up in conflict. If founders are not careful, the succession process may begin to resemble the Survivor TV series more than an orderly transition that benefits the business. By counseling children about the dangers of splitting before it happens, founders can reduce the odds that it will happen.

In planning for transition, founders need to not only consider the needs of the business, they need to consider their own needs.

Entrepreneurial founders typically prefer action to introspection. If they do not consider their own needs before the transition, their needs will begin to become obvious as the transition time nears. Transition is challenging — especially for founders. While many founders may seem themselves as tough business people, they may be very emotionally vulnerable when it comes time to let go of their business. By facing up to their own fears and concerns, they can be more honest in communication and planning with successors.
Family members need to be advised to help more and judge less during the transition process. If family members are aware of the founder’s vulnerability during this process they will react more with sympathy — and less with cynicism or judgment. The more supportive the families members are, the more likely the process will work effectively.
One simple piece of advice that I give any of my friends who are getting a divorce is to reach an agreement as soon as possible. No matter how unfavorable the settlement may seem before the lawyers get involved, it is almost always better (for both parties) than the settlement after the lawyers get involved. I have the same advice for entrepreneurial leaders and their families. Reach an agreement concerning succession — make peace that everyone will not get everything that they want — and live with it. If a founder dies or leaves the business and a legal dispute follows — everyone will probably lose. Lawyers will make lots of money, family members will damage relationships, and competitors will rejoice — and may even recruit family factions to join them.
Finally, entrepreneurial leaders need to find something else to do before they depart. If they don’t, they will probably drive their spouses, adult children, and leaders of their business crazy. By finding work that will provide happiness and meaning after leaving the business, leaders can be much more effective in planning for transition while leading the business.

This is a fascinating topic. Steven and I are sure that we have only touched upon a few concerns and suggestions about family entrepreneurial succession. What have you observed? What are your suggestions? Please send in comments.

This week's question for Ask the Coach:

In your book, Succession: Are You Ready? you describe the challenge of succession for the CEOs of major corporations. What unique challenges do you see for succession in entrepreneurial family businesses?

My good friend and colleague, Dr. Steven Berglas, and I are currently writing a book that addresses this specific question. Given major demographic trends in the United States, this topic has become more critical today than at any time in our country's h...

This week's question for Ask the Coach:

In your book, Succession: Are You Ready? you describe the challenge of succession for the CEOs of major corporations. What unique challenges do you see for succession in entrepreneurial family businesses?

My good friend and colleague, Dr. Steven Berglas, and I are currently writing a book that addresses this specific question. Given major demographic trends in the United States, this topic has become more critical today than at any time in our...

This week's question for Ask the Coach:

I'm getting ready to move on. Should I look for my successor inside the organization or find a candidate on the outside?

Developing a great successor is one of the most important accomplishments that a CEO — or any senior-level executive — can achieve. But, what's best for your organization, and for you? Should you develop an internal or an external successor?

There are many reasons, both personal and professional, to invest in development for an...

This week's question for Ask the Coach:

I'm getting ready to move on. Should I look for my successor inside the organization or find a candidate on the outside?

Developing a great successor is one of the most important accomplishments that a CEO — or any senior-level executive — can achieve. But, what's best for your organization, and for you? Should you develop an internal or an external successor?

There are many reasons, both personal and professional, to invest in development for an...

This week's question for Ask the Coach:

Change is hard. It takes forever and I don't even know if it's working. Any tips for making this process easier?

Change takes longer than we think and the process is difficult. Acknowledging these facts can make your attempts more successful. My co-author Dr. Kelly Goldsmith, Assistant Professor of Marketing at Northwestern's Kellogg School of Management, and I researched why people give up on their goals. We discovered that there are five common...

This week's question for Ask the Coach:

Change is hard. It takes forever and I don't even know if it's working. Any tips for making this process easier?

Change takes longer than we think and the process is difficult. Acknowledging these facts can make your attempts more successful. My co-author Dr. Kelly Goldsmith, Assistant Professor of Marketing at Northwestern's Kellogg School of Management, and I researched why people give up on their goals. We discovered that there are five common...