Imagine staring at financial statements in disbelief, wondering what's just gone wrong. They reveal that you've just lost $50,000 a month in net profits, a performance plummet of 50 percent.
It's a nightmare scenario. I know, because I lived it. A bad hire at the C-level was the cause of the problem. I'd put way too much trust in my new executive, and the company was suffering as a result. It could happen to anyone.
Hiring a bad customer service agent or sales rep is expensive, but you can recover. Hiring at the C-level is a much bigger investment with far greater consequences. Let's do a gut check so that you don't have to live my nightmare.
First ask yourself if you need C-level executives.
In our "bigger is better" culture, we all feel the pressure to grow our businesses as quickly as possible. If you're a new entrepreneur, you may also be grappling with the drive to prove that you've got a "real" company. Putting people in the C-suite may give you a feeling of legitimacy, but it's not a good reason to start hiring. Check yourself and make sure that you're at the right point in your company's growth before you proceed.
More and more C-level executives are outsourcing their services. This is a great option if you want to tap into executive expertise without relinquishing control over your company. It's also a lot cheaper than paying a C-level salary, plus benefits. Finally, this option can give you a sense of what an executive might actually accomplish for your company.
Keep one hand on the reins.
Never relinquish full control over your company, even if you hire a full-time CEO. Trust yourself. Nobody knows your company the way that you do. You may be a scrappy kid who started your business in a basement, and this executive in front of you may seem glamorous and worldly. Keep some control anyway, because you know more than you think you do.
Take it slow.
Not all executives are right for all companies, no matter how experienced they may be. So experience or a past track record are not reason enough to hire anybody.
Thus you don't want to be in a hurry when it's time to hire your first executive. Take six months or so to get to know this person, and check every one of their references. This will give you time to determine whether or not he or she will be a good fit.
Then ease the executive into your company. Watch what they accomplish. Don't just walk away, thinking that everything will be fine because you've hired the right person. Everything may not be fine, and you won't know it until it's too late.
When can you relax? About a year after making the hire. At that point you'll have a track record to look at, one that came from performance within your own company. You'll emerge with the knowledge that you've made the right decision. Turn your attention elsewhere so that you can keep growing.