A more defined subset of shared leadership is the rapidly growing phenomenon of co-CEOs or co-Presidents. Family businesses are leading the way in implementing what the literature calls a “special case of shared leadership”. The surveys showed that in 2007 over 20% of US based family businesses were led by co-CEOs –an increase from the 12% recorded in the 2002 survey. It is not only family businesses that are implementing this leadership structure though –Oracle is the latest publicly traded firm to announce joint CEOs, and they join Whole Foods, among others.
The phenomenon has created a heated dichotomy of views between those who think that the complexity of today’s business world makes this an idea which time has come versus others who see it as disaster in the making. Family business scholars are similarly divided between those who think that it is a workable answer to business and family issues and those who think that it is an easy way out for parents faced with a choice between their children.
The Cons
Full disclosure here –I have a vested interest in this phenomenon and have conducted and am still conducting my own research studies into co-CEOs in North America. My research includes a detailed case study and more recently, interviews of family business co-CEOs. Yet, other family business researchers tell me that they find the idea not well received among family business advisors and researchers. I have encountered a fair degree of scepticism myself. There are those who say that the arrangement slows down decision making; causes confusion, if not manipulation among employees; is a recipe for conflict; wastes resources; dilutes responsibility; reduces accountability – a litany of don’ts. The Fortune Magazine September 20 internet post quotes eminent business professors giving their dire views of the concept of two or even three at the top.
The Role of Roles
Those who are willing to even entertain discussion about this leadership configuration immediately pronounce that there must be a visible and clear division of labour and reporting arrangements. Yes, in the interest of efficiency, most co-CEO pairs do implement some kind of role differentiation as each person may assume more oversight for certain functions within the company. Yet there is a reasonable degree of role overlap. At the very least, each co-CEO is well informed about the areas not under his direct supervision to the extent that each could fill in for his co-leader should the temporary need arise.
Actually, they often cite that level of flexibility as an advantage to the arrangement. That is not the biggest advantage to role overlap that the co-CEOs cite. Those family members who share the top posts speak to the synergy generated by the arrangement. I have had one of a brother co-CEO pair say to me that in their arrangement “one plus one equals five.” When the leaders collaborate, the combined efforts produce thinking and results for both the business and the family that exceeds the simple addition of their skills. The interaction could bring out more than the best in each person. I had a sister co-CEO say of her brother “I think better when he is in the room.”
The arrangement works well when the co-CEOs have complementary skills –as in marketing and administration, or technical and operations and I have seen it work just as well when both family members have similar specialty education. The leadership structure allows for each person to maximize personality traits as well, with the more gregarious of the pair naturally becoming the face of the company. Yet, each co-CEO publicly recognizes his co-leader and does so naturally and effortlessly. Their business cards say co-CEO, and they acknowledge the other, even when that person is not at the meeting or event.
The Triple C
The successful co-CEOs enjoy regular contact and relish the fact that they are often co-located and often in offices right next to each other. Some of them set up regular daily meetings –one pair has a standing morning coffee date –and often, they allude to how easy it is to “just walk over and pop my head into his office.” Even if one of them is elsewhere, the co-CEOs all speak to deliberate efforts at enhanced Communication. As a research participant said “if you don’t communicate, what’s the point? You might as well just have one.” And it is not just about keeping each other in the loop. They recognize that between joint leaders, the communication must be honest and open. There is no room for hidden agendas in this structure.
A co-CEO said it well when he told me “if you properly communicate up front, and you’re truthful about what is on your mind and you may not like to hear the answer, but it’s a truthful answer and, so that’s the key issue in our life, is our ability to be open in our relationships with others.” While this is valid for any kind of joint ownership and/or management, it takes on additional significance when there are 2 people occupying the top post.
Conflict is inevitable and indeed welcome in good leadership teams. I maintain that 2 heads are better than one only when they disagree. And a key component of the relationship between the co-CEOs is that they have worked out some kind of mechanism for resolving conflict. This usually entails “taking it off line” as a co-CEO said to me. So for major disagreements, most co-CEOs retire behind closed doors and work it out. Sometimes, they resort to the Board of Directors or an external consultant and that is not the norm. Finally, in the eloquent if not elegant words of one co-CEO, sometimes “you just have to suck it up.”
There are other features of the relationship between co-CEOs that bear further airing –like trust and respect, the usual suspects. And practically all of the co-CEOs whom I have encountered, speak of having fun doing this. What better motivation could there be!