How leadership growth maps to the six types of decisions
A framework to help leaders empower their teams more intentionally
Welcome Entrepreneurs. I’m so glad you’re here. I’m headed out to the woods this week for a camping trip with Laura and the boys. We’ve rented a cabin at a KOA campsite which seems a cross between rustic-glamping and summer camp, and I am nearly giddy with excitement. S’mores, arts and crafts with the boys, and standup paddleboarding. By the time you read this I’ll probably be trying to figure out how to cook beans over an open fire, so I hope you’ll wish us luck.
In the meantime, each founder I work with sees a future in which he or she is no longer as essential to his or her company, and can earn some space from the day-to-day responsibilities. But given the complexity of the work involved in gaining that space, it can be hard to see where one is in the process. This week’s essay outlines a very practical framework I use to help leaders chart their progress up the metaphorical mountain, and intentionally push themselves to level-up faster.
Hope you enjoy.
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How leadership growth maps to the six types of decisions
My practice is organized in part around helping people navigate the transition from founder to CEO — from the do-it-all hustler who can get an idea off the ground to the transcendent leader who can assemble and empower teams of teams to perform at their best in a VUCA world.
This transition changes people. The person who founds a company is virtually never the person who can take it the distance. Navigating this change requires a person to let go of the things that they do well as an individual contributor (often the very things that enabled them to build the company from scratch), and develop a comfort in leading others that, ideally, do those things even better. As Jobs said, a leader must stop playing an instrument, and start playing the symphony.
This transition is fraught with ego and identity challenges (example: who am I and why am I valuable if I’m not an engineer? Who am I to lead If I’m not as good as my team?), which can be disorienting, and the work is so internal and subjective that it can be tough to tell if you’re making progress.
The simplest way to orient yourself to this transition and chart your progress is to notice what types of decisions you tend to make versus those decisions you tend to delegate.
There are six types of decisions: why, where, who, what, how and when. When starting up a company, each of these decisions fall to the founder. To continue to lead a growing company, founders must delegate these decisions. This delegation process is often done in a specific order (when -> how -> who/what -> where -> why), which can serve as a point of orientation as you go.
This decision is often an outgrowth of the founder’s personality and personal history, and is very rarely delegated outside of outright succession planning (and often not even then). This includes:
The mission of the company
Why you are doing what you are doing
Your transcendent purpose
In growth stage companies this decision is often owned by the CEO and informed by the senior leaders. In earlier stage companies, this is often owned entirely by the CEO. This includes:
The vision of the company
Where are you going to be in 10 years?
Your BHAG; the most audacious impact your company can have.
What does success look like, and how will you know when you have it?
In early stage companies, personnel decisions are critical and should be owned by the CEO. Many CEOs try to retain control of all these decisions as the company grows, but after 25-50 people if not sooner the CEO must begin to empower employees to make their own personnel decisions, starting with the most fungible roles and working upward (CEO always owns senior leadership). I’ve listed Who and What in descending order intentionally, because I most often see CEOs hold onto Who longer than they hold onto What, but sometimes these two are flipped. Who decisions include:
Which roles are needed to get the company where it needs to go
Who is hired or promoted into those roles, who is fired, put on PIPs, etc.
Like personnel decisions, outcomes are also owned by the CEO in early stage companies and delegated increasingly as the company grows, but most CEOs let go of defining the outcomes (while retaining some amount of veto-power) before letting go of personnel decisions. What decisions include:
Objectives & Key Results (OKRs)
The strategy or plan. What specific actions will we take to accomplish the outcomes which get us to where we want to go? Strategy is often hard for first time founders to let go of, but holding on too long, or asserting themselves too much in these types of decisions can cause problems. There is little leverage in the CEO owning How decisions (and a hell of a lot to gain by giving employees ownership), so leaders at all stages would do well to err toward delegating here. Getting agreement around an objective, measurable outcome (What) is the key to doing so successfully. How decisions include:
Deadlines. By when will we accomplish our desired outcomes? This decision is often a negotiation between people at two different levels of an organization but is most effective when owned by the lower of the two levels; it’s easier to hold someone accountable to a deadline they gave themselves. Even CEOs of very young companies or very small teams will do well to give their teams responsibility for setting their own deadlines from the very beginning. When decisions include:
Using this framework
It’s probably important to note at this point that the above is a compass, not an instruction manual. There’s more to becoming a better leader than simply delegating decisions (and yes, there are many times in which delegation would be inappropriate). But as you go through the process of upgrading your leadership and the capabilities of your team, I find that the above framework can help you orient yourself to where you are in the process of extracting yourself from the center of your business, and to where you might go next.
As you reflect on your own growth as a leader, notice what decisions you’re holding onto. And then ask yourself what life might be like if you were to empower your team to handle the next rung up the ladder.
If it only scares you a little bit, it’s probably time.
(HT: Julie Mosow, Tom White and Foster for editing)
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Who is Ryan Vaughn?
I’m an executive coach for startup founders, a role in which I get to help high-performing founders design a more conscious life and expand into extraordinary leaders. I’m a 3x Founder/CEO who’s raised $20m+ in VC and built a market-changing company, as well as two other companies that taught me things. I’m an avid writer, meditator (decade+ practice), reader, athlete, father, husband, amateur physicist, student of leadership, and adventurer. I’m also none of those things. But I am glad that you’re here. If that’s not enough, here’s a more detailed bio.
THINGS I READ THIS WEEK
One: The SEAL
Angel and VC investments each rely on an eventual exit to return capital to investors. Accordingly, angel and VC capital is only available to those companies who are prepared to scale and exit (probably 1% of companies) while the other 99% of companies — from auto shops to restaurants, from retail to lifestyle — must rely on bank loans.
At least that’s how it’s always been. But this might be changing.
A friend introduced me to the SEAL, the Shared Earnings Agreement, as an example of a new kind of financial instrument, designed to make high risk capital available to businesses of all kinds. My guess is this not the last we’ll hear about these types of creative financial instruments.
Two: Free will (David Perell)
David Perell cited an idea of Chris Sparks’ in his email newsletter this week, which I thought was really interesting: “When it comes to creating your environment, assume you have free will. When it comes to living in it, assume you have no free will.”
I’m a junkie for questions like “do we have free will” (I’m team no, for the record), but from a practical perspective I really like this take. Design your environment intentionally, for a future you who you assume (graciously and with love) will have relatively little willpower to choose the right thing in the moment.
Three: Dead Startup Toys
Wish you had a Theranos blood testing kit, or a Juicero squeezer on your mantle, if for no other reason than an ode to the obscene amounts of capital that can be wasted on things?
You’re in luck. And only $39.99
Four: The most precious resource is agency (The Map is Mostly Water)
Stumbled upon the concept of Eudaimonics this week. Never heard of it? You’re in good company. It’s:
A recognition that the human experiment is entirely organized around maximizing short-term income, and a direct tie from this fact to climate change, income inequality, et al
A proposal for how we might organize differently
Groups of people need metrics to organize around, and this unique approach feels like the type of thing that might, eventually, turn the ship.
FIVE: How do we do drugs now? (NYT, via Michael Pollen)
For decades the policy was so simple. Just say no. But now that as a society we are at the cusp of actually thinking intentionally about the role drugs like MDMA, psilocybin, DMT & LSD, it’s time that we also think about what sort of social and legislative structures we put in place to maximize well being and minimize negative effects. Michael Pollen raises that question here.
One of the most interesting points to me was the research he cited illustrating that substance addiction is not as much chemical as it is circumstantial. If those results continue to bear out, that could change the entire conversation about the downside of drugs.
WANT TO DIVE DEEPER?
If you liked this, check out this list of my top posts, read and shared by thousands of entrepreneurs.
Here are a few of my favorites:
There’s a reason every elite athlete in the world works with a coach. You need more than one perspective to see your best work.
At Inside Out Leadership, I’m privileged to work with amazing humans every day to help them grow into extraordinary leaders, and support them in building the company of their dreams. As a 3x founder and CEO for 15 years myself, I coach entrepreneurs how I want to be coached:
Focused on the person, not the role.
Focused on results, without the fluff.
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