Alexandre Bonvin is the founder and CEO of Audacia Group.
CEOs become adept at juggling many different roles and responsibilities, but sometimes these priorities end up in conflict with one another. On the one hand, you strive for operational excellence, making ongoing improvements to processes and systems to reach your business goals. On the other, you aim to create long-term value in your organization, taking risks that may or may not pay off.
This push and pull highlights how important it is to develop a strategic mindset as a CEO. The skills that served you well in operations aren’t necessarily the skills you need to lead and grow a successful company. Move beyond your past role as a “doer,” and zoom out to think like a strategic investor with these six strategies.
1. Manage Your Company Like An Investment Portfolio
Whether you work for a Fortune 500 company or an SME, you must make decisions about how to invest your limited resources and advance both short- and long-term goals. Imagine that your company is an investment portfolio. Where do you want to allocate your money in the next year, the next three years or the next five years to realize your vision for your company? What risks are you comfortable taking to stay ahead of competitors and changes in your industry?
Weigh the tradeoffs of each investment. You may decide that investing in new software, warehouse machinery or staff training will have the highest overall payoff—even if you need to wait three years to fulfill it.
2. Accept Risk As Part Of The Investment Strategy
Entrepreneurs have to become comfortable embracing uncertainty, but employees and managers have a different way of calculating risk. They may have legitimate fears about the consequences they’ll face if they make a mistake and invest in the “wrong” strategy. In the best-case scenario, they could lose their bonus; in the worst-case scenario, they could lose their job.
An organizational culture that is extremely averse to risk can hinder individual employees and the organization as a whole. Don’t let your P&L be the only factor that shapes your team’s decisions. If your profits don’t increase this year, that doesn’t automatically mean you had a bad year. You may have invested in key areas of your business—such as technology and training—that will take longer to realize value but ultimately move you toward your future vision.
3. Empower Employees To Think Like Entrepreneurs
As the leader of your company, you set the tone for your culture. Your employees will look to you to see what values you prioritize and put into practice every day. Create a culture that encourages a strategic and entrepreneurial mindset.
Recognize employees who invest their time and resources in innovative ideas and projects, even when they are risky. Celebrate failure as part of the learning process, and make it okay for people to try and fail—and try again. Keep coming back to your long-term vision, and cultivate this mindset among all employees, regardless of their role. Today’s junior IT employee might become your CTO in 15 years.
4. Release Emotional Attachments
Investors get into trouble when they let their emotions guide their decisions. It’s no different when you are an investor in your company’s future success. Let go of any emotional attachment you have to a particular investment. If you were a neutral investor in your business, with no emotional ties to it, what would you do differently? What choices would you make?
5. Keep The Good Ideas In Your Company
People who work in the corporate world often feel as if they have two choices: Do their job without making mistakes, or leave to launch their own startup. But there’s a lot of space between those two extremes. Any employee in your company could have a great idea that becomes a great new product or service—but only if they feel empowered to pitch that idea.
You run the risk of missing out on your team’s skills and talents if you don’t give them a way to invest in themselves as well as the company. How can they act with purpose to advance their own goals while also benefiting your organization? Why should they take action? And why should they take action in a specific way?
You want everyone in your organization to think like an investor, not a gambler, so they need to tie their actions to the specific value they will bring to the company. For example, why do you need a GenAI license? For what purpose: to code, to write emails, to create web content? Be clear on the reason behind your actions.
6. Align Rewards With Efforts
When you ask your employees to invest their time in a new project, it’s important to align their efforts with commensurate compensation. They still need to do their daily operational tasks, so it has to be worth their time to move an idea forward.
In my company, we use a profit-sharing model to motivate employees to launch new product ideas. If the project goes south, employees have no risk of losing anything except time. But if the project goes well, they could earn large bonuses or a set percentage of the profits. There is no downside for them to pitch and chase their ideas, and when they win, so does our company.
When you’re accustomed to an operational mindset, it may take time to switch gears and develop the mindset of a strategic investor. Start small, keep your mind open and always stay focused on your long-term vision.
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