No matter how many capable advisers you have around you, being the CEO of a growing company is a big job that requires many skill sets. So why not divide the responsibility and put co-CEOs in charge?
But two heads aren’t always better than one. A George Washington University study explored whether co-CEOs were the answer to the high failure rates of second-generation, family-owned businesses. (The answer: sometimes.) But David Martin, founder of leadership consulting firm David Martin & Company, says having two people in a role where there is typically one decision maker “almost never works.” When two people are working in a fast-paced environment and need to make decisions quickly, having to check in with another person can make an organization less nimble.
Still, those who do it well find it brings benefits to the organization. In order to give co-CEO roles the best opportunity at success, here are five essentials to keep in mind.
Karen Kimsey-House and John Vercelli have shared the leadership of Coaches Training Institute (CTI) since 2015. Since its founding in 1992, CTI has had both singular and co-leadership, so it isn’t an unfamiliar dynamic to employees. Still, Kimsey-House and Vercelli were certain that they needed both of their skill sets to grow the organization. “We just find that the whole is greater than the sum of the parts,” says Kimsey-House.
There has to be a big reason for co-leadership to make sense for a company, says strategy consultant Allan Cohen, a management professor at Babson College. Co-CEOs understand that one person doesn’t have all the answers. One leader may bring a particular skill set to the table or can manage a part or region of the company better than the other can. But it has to be clear why co-managing is being done in order for it to be effective, he says. “[It] doesn’t work very well if they are overly competitive and do not know how to work to their individual strengths or complement each other appropriately,” he adds.
One of the first things that needs to be done is a division of responsibilities, says management coach Rhett Power, author of The Entrepreneur’s Book of Actions. The relationship won’t work if toes are regularly being stepped on. Determine the areas in which each has the final say, and put it in writing, which can be referred to if conflict arises.
It’s also important to decide how worst-case scenarios will be handled. What will happen if there is a serious disagreement about an important company decision? Will there be a board of advisers or other entity that will help resolve it? Who will have the final say if an agreement can’t be made? And what will happen if co-leadership is no longer right for the company?
“That’s a really painful discussion,” says Power. He’s currently working with a company facing just such a crisis, and it’s threatening the organization’s livelihood. “Basically, they’re going to have to close the company, or someone’s going to have to get paid to leave.”
Cohen also warns leaders to be careful about the division of responsibility. Some duties, such as setting a company’s strategic direction, making large investment decisions, and choosing key hires, are more powerful by nature. If your power structure has one person consistently making these decisions while the other handles more of a support role, one co-CEO may end up being that in name only. Eventually, that’s bound to lead to resentment. So while responsibilities should be divided according to skill sets, also define the decisions that will require both CEOs to weigh in.
Miscommunication is bound to happen, so ways of communicating regularly, well, and often need to be established, say co-CEOs Karen Robinovitz and Raina Penchansky, who lead branding agency Digital Brand Architects. They lead their team of 50 from opposite coasts–Robinovitz in New York City and Penchansky in Los Angeles–but they communicate by phone several times a day.
While they say they have similar views on most things, there are still times they have to compromise, says Robinovitz. They’ve known each other for 20 years, so they understand each other’s communication style. Paying attention to those details—how someone reacts when under duress, for example—helps to reduce conflict. “We understand a tone of voice the other one has and what that means, what that person might be feeling. Just like you would in a marriage. And you know when to step away, or when to step close and have certain conversations,” she says. Knowing that they both have the company’s best interests at heart helps them let go of perceived slights or issues that don’t matter.
Once roles have been clarified, it needs to be communicated to the team, Martin says. If employees receive mixed signals, some will become disengaged, while others may try to play the co-leaders against each other to get what they want, he says. In addition, Martin says it’s critical for co-CEOs to present a united front, even when there is conflict.
Martin recalls a conversation he once had with a client. “I told him, ‘When you eat lunch late, or you come to the office early, or whatever, when you’re not smiling, people are trying to interpret that all the time,'” he says. So, keeping that in mind, if your employees see conflict at the top, it can cause concern.
Co-CEO roles aren’t easy, but they can make a big job more manageable and provide additional skills and insight. Consider this option carefully, says Cohen, and ensure the details—including what to do if it doesn’t succeed—are worked out from the start.