“A world of no surprises.” That is the lofty goal of private equity investors Eli Boufis and Steve Thompson when they take on a new company. It involves open communication with the CEO – including reminders of how much money they can make if the acquisition succeeds – and a plan to build a better board of directors.
Building a better board of directors is a four-part process:
Bruce Werner has a blunt message for company owners. “Owners are leaving money on the table. They’re not getting full value from their boards,” he says. “We can improve the outcomes in your business, make your life a little better, and take risk out of the business by having a board do what it ought to. And it doesn’t take that much more effort. You just have to ask a few important questions.”
Werner came up in the family business, a $500 million company that made ladders until it was sold in a leveraged buyout in the mid-90s. After the sale, Werner started, grew, and sold four companies, was a partner in a private equity fund, and served on more than 10 boards, mostly for family-owned firms.
He’s distilled all of that experience into two books, Your Ownership Journey: 12 Secrets for Personal and Business Success, which published in 2022, and Navigating Private Company Governance: The Savvy Business Owner’s Guide to Developing an Effective Board, which published in 2023.
We interviewed him in the wake of the publication of Navigating Private Company Governance and asked him about his advice for business owners wondering whether they need a board of directors for better corporate governance.
Every new year means new challenges and new opportunities. This new year, 2023 is no different! When we asked 204 C-level executives for their 2023 predictions, their responses reflected five clear business trends:
Let’s take those one at a time.
When Chicago White Sox relief pitcher Adam Russell’s baseball career ended, he had to figure out a whole new career, with virtually no warning.
Today, the former big leaguer works in the insurance industry and volunteers helping other sports figures make the transition to a post-playing career.
It starts with the resume.
“A lot of guys don’t know how to relate what they learned in professional baseball to the business world,” Russell says. “I was seeing resumes that said things like, ‘I set the record for triples in the month of August in Round Rock.’ Great. It’s awesome. But a CEO doesn’t give a crap about it.”
Not understanding how to sell oneself on paper is certainly not a problem limited to former athletes. At InterimExecs, we’ve seen resumes from C-suite executives with 30 years of valuable experience leading companies, making change, and having an impact, who headed their resumes – first item up – with the degree they got from an Ivy League college many years earlier.
Get excited! We are thrilled to announce the launch of our new book Right Leader Right Time: Discover Your Leadership Style for a Winning Career and Company, set to hit Amazon and other outlets, March 29. First a little backstory:
Since 2009, we have had the good fortune of speaking with thousands of executives, owners, and investors. If you look at interim as a specialty, it almost always is associated with some type of change happening within an organization. Maybe exponential growth is on the horizon. Or the opposite and the building is on fire. It could be competition is looming and fresh thinking is needed. In matching executives from the RED Team with companies big and small, we saw firsthand that the biggest predictor of success always came down to one thing: leadership.
We wrote Right Leader Right Time, to share our lens on leadership and to help leaders and organizations move toward bigger and better opportunities. Let’s jump into just a few key insights:
The cannabis business has been exponentially growing in the last few years — just look to the proliferation of dispensaries, and growing acceptance across state lines. But thanks likely in part to stress and stay-at-home orders, 2020 was a big year for the bud. According to a BDSA report, sales of legal cannabis in the U.S. hit $17.5 billion last year, a nearly 50% increase from 2019. And it’s projected to jump to more than $40 billion by 2026 as more and more states legalize cannabis overall or add adult use programs to existing medical ones.
That means standing out in the market is all the more important. Businesses can follow some parts of the consumer product playbook, but with wildly different rules and regulations from state to state, bringing a cannabis product to market is anything but traditional. That’s what InterimExecs RED Team executive, Leah Bailey — Chief Business Development Officer at Australis Capital Inc. an early stage, brand focused MSO that was originally an offshoot of Canadian LP Aurora and former CEO of Fluresh, a vertically integrated cannabis company based in Michigan — experienced when she made the pivot to cannabis.
“I’d worked for many years in consumer products and was looking to find new challenges and learn a new industry,” says Bailey, whose resume includes mass market personal care and beauty product providers Helen of Troy, Paris Presents and Unilever. “I love the fact that everything we do is a challenge. Many people are coming out of traditional consumer products companies like PepsiCo and Kraft and going into cannabis from a marketing standpoint. It’s become very accepted.”
What is the key to starting and growing a cannabis business? Here, Bailey explains how to translate traditional CPG skills to a cannabis brand, understanding consumers without traditional market research, and what the future holds for the industry.
Low price is the last refuge for marketers who don’t have the patience or guts to demonstrate value for those that need it. – Seth Godin
When it comes to buying gas for your car, fertilizer for your lawn, or for that matter the price Apple pays for the copper in your iPhone, lowest price makes sense. These are the classic definition of the word commodity – something which comes from the ground and whose price rises and falls with supply and demand.
Unfortunately, we all now use the word commodity to mean much more, applying the sense of generic-ness to just about every product and service available to us. If you are marketing soap, for example, you face over 1,000 competitors on Amazon. If however you’re the marketer behind Tesla or NetJets or the Chicago Bears football team, your job is simpler. You won’t sell as much, but your product is so highly differentiated that when your customer wants you, there’s no close substitute. You are not a commodity. You are unique.
Even before the pandemic forced businesses to be more nimble and forward-thinking than ever before, the need for interim executives had been growing. In 2020, we asked 600+ execs to shed light on interim roles, a comprehensive survey that covered the who, what and why behind the growth of this category. And now as the world is finally defeating COVID-19, businesses are continuing to adapt and re-strategize with a new set of challenges, only amplifying the need for experienced, “make it happen” interim executives even more.
To better understand how the current marketplace is dictating the need, we conducted a follow-up survey, asking 125 executives to answer the same question: “What trends do you anticipate having the greatest effect on the interim specialty in the year ahead?”
Across both surveys, the conclusion was clear: interim executives are needed now more than ever. 71% of respondents see opportunities for interim management trending up and another 21% seeing they will remain stable throughout the coming year. Here, we break down the five reasons why more organizations are drawing on interim executive leadership:
When smart owners hire managers with the intent of working together for a long time, it’s easy to call their relationship – if it works – a partnership. It’s not a partnership in the legal sense and it’s not a partnership in the investment sense, where partners share costs and gains.
But in great working relationships between employer and employee, each looks out for the other. Each invests to build and maintain a good relationship and share the gains of working well together and advancing the mission and economic and social health of the organization.
The problem with rampant outsourcing is that it leads to thinking on the part of employers and contractors that relationships are reduced to a transaction. Pay me X and I’ll perform as ordered. Stop paying me and I’m gone.
The logic is the same whether it’s one contractor or ten thousand. While it is transactional in the letter of the contract, it is not in the spirit of one.
The danger of a purely transactional mindset is that loyalty goes out the window. Loyalty from a boss to an employee and loyalty from an employee or manager to the organization.
In organizations with a strongly transactional bent you can bet that any corporate talk about integrity is a watered-down concept at best.
Many company owners and board members are familiar with some aspect of litigation – or at least the threat of it. The paperwork, the Zoom calls, the meetings, hearings, depositions, the back and forth, the cost—democracy might promise a jury of our peers and having your day in court, but adjudicating a dispute the traditional route is for many, impractical, long, and expensive.
Shutdowns during the pandemic made that point all the more clear. Since the start of COVID-19, the volume of disputes has increased by more than 65% for companies over $1 billion, 50% of in-house legal teams are being pressured to spend less, and 75% of corporations want new preventative dispute mitigation procedures.
“The first question is never, ‘What is every single thing we can fight about?’ The first question out of any executive’s mouth is always, ‘This is a distraction—how quickly can we get this done and behind us?’ says attorney Rich Lee, whose 15 years in the field include general counsel roles at Livevol and Civis Analytics, a data science company stemming from Barack Obama’s 2012 re-election campaign. “Nobody, when you’re on the business side, ever relishes that dragged-out fight in any form.”
That’s why Lee teamed up with two fellow general counsels and a legal operations exec to form New Era ADR, a private arbitration and mediation platform rooted in efficiency, transparency, experience, and innovation. He says their process is 90% faster and up to 90% cheaper.
“Anytime there’s a potential dispute, it’s a massive distraction,” Lee says. “It costs the company a lot of money, a lot of time, and frankly, I think the worst part that’s immeasurable is that attention that you end up devoting to navigating a potential dispute. You could be in a sales meeting and you’ll be thinking about that dispute. It’s our firm belief that it just doesn’t have to be that way.”
We spoke with the New Era CEO and co-founder about the intricacies of arbitration vs. mediation, how to de-risk your transactions, and the best ways to protect yourself from arbitrary outcomes.
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