Whether
it’s sales or migrating customers to a new technology, sometimes your job as
CEO is to get out of the way and let the team execute.
EXPERT OPINION BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V
AND CHICAGO HIGH TECH INVESTORS @HOWARDTULLMAN1
APR 8, 2025
Entrepreneurs are
terrible control freaks – very often for good reasons – but, just as
frequently, they hang on too long and too tightly to all the reins and end up
unintentionally holding their businesses back. I understand that many of the
relationships a CEO has to confront and manage are complicated. Stepping aside
or back to let others handle a given situation can sometimes be very tough and
close calls. And to be clear, in many cases, only the “boss” does know best.
One typically hard
decision is determining when the CEO should stop making every sales call. In the early
days, and while the product or service itself is still finding its way to
market fit, it’s essential that the CEO be in the field because he or she is
the only one with the power and authority to make choices, representations, and
commitments regarding changes, features, and deliverables that: (a) can make or
break key early adoption and critical bell cow sales and (b) can positively
influence and alter the direction and development of the offering itself.
The most powerful and
direct feedback you ever get is straight from the customers and prospects
themselves, and the buyers’ voices need to be heard and heeded. So, while, as
the leader, you might need to be there in the early days, you also need to know
when to step aside.
Sometimes the boss needs
a shove
In some cases, it’s
absolutely essential that senior team players and sometimes board members and
outside advisors pitch in. They need to help pry the CEO away from the front
lines and from other early fixations, which can get in the way of growth and, even
more importantly, profitability. As startups grow and the number, variety, and
specific demands of their customers change and expand, the nature of the
company’s connection to each individual client, user or buyer needs to change
as well, even if the CEO doesn’t necessarily agree.
Maybe if your product is
a mass produced, inexpensive widget you can get away with a “one size fits all”
approach, but that won’t cut it in most instances. And it’s psychologically
hard for the founders and early team members to step back from the “high-touch,
hands-on, 24/7, always there” philosophy, which they believe is what made the
business successful in the first place.
They’re not wrong. But
what worked in the early days simply doesn’t scale economically in most
businesses. The trick today is to maintain the “personal” connections, but to
also control and contain the costs of service and delivery. This is never easy
when customers want Four Seasons service at McDonald’s prices.
How SaaS changed
customer management
The delicate and often
touchy migration away from face-to-face and on-premises interactions with
clients and customers to remote services has largely been driven by cloud-based
software and other technologies that were championed early on by Salesforce. Remember
the company’s “The End of Software” campaign in 2000? Its signs,
buttons and even dressed-up cartoon characters declaring “No Software” with a
big red slash were suddenly everywhere you looked at tech conferences. The
clear message was “you didn’t need to own and operate the cow (servers and
other computer equipment) to enjoy the milk”, and further you also didn’t need
your own IT department.
In truth, even though
companies took a while before they made substantial SaaS adoptions, it was
fairly easy to virtually move an end user’s computer activity from a mainframe
somewhere in their building to software located in the cloud because – as long
as the service wasn’t interrupted – the person sitting in some office at a
computer terminal absolutely couldn’t tell the difference.
The more challenging
transitions were in the next stage of the technology migration toward DIY: when
other service vendors started to pull their people from the field and –
immeasurably assisted by the fact that everyone had a phone – began to educate
and train their customers to do more of the “work” involved in the service
themselves.
Taking complexity out of
photography
A simple example is
event photographers. In the old days, photographers would spend hours moving
through a crowd with expensive SLR cameras snapping shots which would be
delivered to the event’s host some weeks later and eventually the physical
copies of the photos would find their way to the attendees if they were lucky.
The photographers were expensive, the photo preparation and delivery costs were
considerable, and the delays – in a world of instant gratification – seemed
interminable.
Today, employing
technologies from firms like Spot My Photo event participants are told to load
the vendor software on their phones, they register their face and phone with
their first photo, people in the photos taken during the event are identified
in the cloud by facial recognition tools, and — in real time — copies of the
photos are sent to the phones of the individuals pictured in every shot. Spot
My Photo’s tagline is “Let Your Photos Find You.” The company receives a fee
per event from the host organization and basically has no marginal costs.
Even more importantly,
there are enormous flywheel and follow-on advantages and benefits to the vendor
because the installed software on each phone remains live and active and
additional photos from other events or subsequent occasions can be directed to
the user’s phone automatically.
The final step in the
typical vendor’s migration is to step away entirely from the individual events
or other activities on site and simply license the software for a fee to third
party providers who then assume all the costs and responsibilities involved in
sourcing, servicing, supplying and supporting end users. Each step in the
migration away from the field – done properly – increases the main vendor’s
margins and profitability, reduces its headcount and overhead burdens, and
simplifies the business.
Simple steps from
service to SaaS to ultimately a hands-off attitude of “so what” are initially
difficult for diligent and conscientious CEOs to manage emotionally–but easy
for their CFOs to love.
