Are two heads better than one?
How small businesses should approach the issue of leadership
The following is a short extract from 100 Greatest Ideas for Building the Business of Your Dreams by Ken Langdon.
I have to report from observation and from conversations with people who have done it very successfully that the top person in a new and growing company needs to have two heads, either literally or metaphorically.
The problem is the old one of balancing the pressures of today against the longer term thinking required to build the dream and it looks like this:
1. Without a long term strategy companies run the risk that decisions they are making today will have a negative impact on results in the future.
2. But we have to stay real; business people are always under pressure to carry out urgent day-to-day tasks. They have to meet today’s objectives and overcome short-term problems. They have to respond to their customers, whoever they are. Everyone is involved in such work and in operational, or short term, planning. In a fast moving environment it is little wonder that planning for the future tends to take second place.
3. If these two statements are true for all organisations, they are much more dramatically experienced in startups and small companies. There is no point in defending an action as being right for the long term if it is going to assist the business to run out of cash. On the other hand, making a sale that is outside the main route you have planned could be catastrophic for the future.
So we come back to the two heads. The top of any start up company needs a ‘can do’ and ‘do it now’ attitude. It needs someone who will discuss a problem find a solution and immediately pick up the telephone to start implementing the solution.
As for the solutions themselves, expect to need some fancy footwork just to keep the business afloat.
No one has solved the particular problems you are about to face; there is no precedent; so one of the two heads has to spot solutions or activities that would be described by some managers in large companies as completely off the wall. And yet no one built a business without thought for the future affecting what we do now – the second head.
Some people can simulate the two heads inside their one brain. Reacting, ducking and weaving with the best of them but also from time to time checking that they are not mortgaging the future or taking short term measures that endanger the long term goal.
Others form teams of two where one person is clearly the go-getter, and the other the ‘just a minute, let’s think this through’ person. So, think on. Can you do it yourself with a Chinese wall in your head separating the two processes or do you need a partner?
Suppose you have decided to go with two people, the next decision is whether the partnership is equal or if one of the partners is slightly more equal than the other. Some venture capitalists that have worked with many startups have come to the conclusion that every team needs an identified leader.
They advocate, for example, in a limited company that the shares are not split 50-50 but one shareholder is given the edge, even if it is only 51-49. That way, they claim, if it becomes necessary to arbitrate between two courses of action they both know in advance whose opinion will hold.
But some successful entrepreneurs, whose experience is that the 50-50 split can work well, dispute this. One such, the long-term thinker of a successful duo, says that had the other person had even the smallest edge of power, it would have lessened his ability to argue his case, and the ‘do it now’ merchant would have forced through mistakes.
He went on, however, to reveal that there was an arbiter, or at least another person involved in the decision making process. This person played the role of non-executive, and low paid, chairman.
During planning sessions the chairman would force the two people through a route of logic that would often reveal to the more impetuous of the two that the way forward he was advocating was not right for the business as a whole.
Indeed this became such a feature of the behaviour of the team that he would often at the end of such a discussion turn on his partner in mock rage saying “There you are, I told you it wasn’t a good idea” – his way of backing down.