Despite common belief, a Chief Executive Officer (CEO) isn’t always the idolized leader of a large, multi-national corporation. They also aren’t always the founder or owner of a company. While that is the case some of the time, the truth is that the CEO position is very dynamic, and can fit a variety of different business models. Below we’ll explore the differences between the two, and when having a CEO may be the best method of leadership for your small business.
The Difference Between Business Owner, Founder, and CEO
A business owner or founder is the person who starts a business and takes it from planning to stable operation. They have recognized a market for a specific venture, and they take advantage of the opportunity. In the initial stages of the business, they assume full responsibility for its health, and will usually reap the profits.
The Chief Executive Officer may also be the founder of the company, but more specifically, they’re the highest-ranking company manager. Their responsibilities are high-staking, as they assume liability for the success and financial livelihood an organization. Because of their high-rank, they also have the authority to make critical decisions about the course of the company.
The CEO and the founder, when they’re not the same person, collaborate on the core mission and fundamental values of the company. They oversee all aspects of the business in order to ensure that operations run parallel to that mission.
When a Small Business Owner Should Hire a CEO
The decision to hire a CEO is typically done with a lot of tact and strategy. In cases where small businesses are looking to scale up, it may be entirely appropriate and even encouraged to hire a CEO. If your business fits any of the following criteria, a small business CEO may be the right move:
You Don’t Have Critical Business Experience
Turning your unique craft, skill or trade into a paid career doesn’t always mean you have avid business expertise. Usually, it just means that you have expertise in your unique offering. Hiring a CEO with vast business experience allows you to pass off critical decisions relative to strategic operations, and develop new strategies to help drive your bottom line.
You Want to Have a Specific Focus
As a small business owner, you wear a lot of different hats that can often pull you away from favorable business activities. If you’re an owner or founder who wants to focus on one facet of the business such as operations, marketing, or production, it might be worth it to hire a small business CEO to manage all the other critical areas.
You Want to Scale But Have No Time to Innovate
Small business growth relies heavily on innovation and strategic expansion. Owners and founders often spend so much time working in their business, that they have virtually no time to work on their business. Hiring a small business CEO allows you to rely on someone else to formulate strategies for growth. Additionally, they can help coordinate critical action to help your business scale.
How to Hire a CEO
In a world where we’re connected to virtually anyone in the world through the power of technology, the biggest challenge in hiring a CEO lies in looking in the right places and hiring the right one. Here’s how:
Seek Professional Assistance
There are multitudes of different entities that specialize in finding and vetting the right candidate for you. If you could use a little help, consider partnering with an organization that can help. Applicant tracking systems (ATSs), such as Greenhouse, JazzHR, Breezy HR, or Google Hire, can be extremely helpful in the recruitment process, and can feed candidates’ information into HR software if/when they’re converted into employees.
Use Your Network
If you’re a business owner, you’ve likely interacted with other like-minded business professionals. Put the feelers out there by mentioning to your connections that you’re looking for a CEO, and don’t be afraid to ask for input from people who’ve been in similar situations. LinkedIn is a great place to join group discussions or view resources.
Plan for the Future You Want
Get all the necessary materials ready to onboard your ideal candidate, including your story, your core mission, and your main values. This person will be learning about your business from a completely fresh perspective, so be sure to have a plan that will effectively integrate them as the small business CEO.
Although CEOs are commonly seen as the top of a large-scale corporate ladder, a small business CEO may be the right choice for the progression of your business that you envision.