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Happy CEO, unhappy staff: understanding the engine of your company

By on May 24, 2011
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I have been involved in many companies, but only once as a CEO.

That experience taught me one lesson really sharply: the CEO has to know how every part of his or her business interacts.

He has to understand how sales relates to marketing, development to them both and finance to all three. He is overseeing a complex, inter-connected machine that needs to work in harmony to deliver on his strategic vision.

That’s the easy part

I realised relatively early that understanding how the business functioned was the easy part. At least it was much easier than the hard part: making everyone else understand why each part of the business mattered.

I can explain this using a car analogy. The only problem is that it talks about departments as cogs, a deeply unfashionable concept in our knowledge economy. But here goes, I’m going to do it anyway.

Every department is a cog

To the CEO at the wheel of his precision-engineered corporate machine, life is good. He is accelerating down the autobahn, foot to the floor, the wind buffeting his face as he revels in his exhilarating ride.

An Outrun screenshot, because this site is about games

Zoom further in, under the hood, and you see a different picture. To a cog in an engine, there are two types of other cog: those that give them energy, and those that take it away.

The ones that take energy away are BAD. The marketing team that wants a dedicated microsite to tempt new customers. The business development bods who want a bespoke integration for a big client. The finance department who want everything allocated to cost codes and projects. The tech team who want to be left alone to develop and not have their time wasted by all these side projects.

Some gears turning, yesterday

The truth is that to propel the car at 140 mph down the autobahn, these cogs have to work together. Taking the energy from the previous part of the chain, working on it, then passing it on.

The easiest life for a cog is if it can take the energy and keep it, disconnected from the energy-sapping cogs that surround it. Easy for the cogs, perhaps, but the CEO’s ride would come to rapid halt.

I’ve concluded that the job of a CEO is (alongside recruitment and capital raising) to make everyone understand how they are vital to the whole. To quash the natural silos that make the marketing team and development team bitter enemies; to make the finance department understand that their job is to help the whole thing run smoothly, and to make everyone else understand how they make it happen.

There’s no right way to do it

You can convince the parts of your business that they need to respect all the other parts in many different ways. You can explain how the business interacts; you can tell them to shut up and get on with it; you can inspire them to work for you irrespective of the downside. Whatever works for you.

The important thing to remember is that, as you sit at the wheel, having fun, there are a lot of people sweating blood and tears to keep you there. You should do everything in your power to help them understand why the whole machine, working in harmony, is good for everyone.

Otherwise the friction in the system will eventually overwhelm you.

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve:
  • Mark Bonasoro

    Sounds like a good thing to read if we all had the time! Though I think they will rather read The FAT Startup, ;P since that’s sort of how they are operating their business, or used to anyways, since the current owner formerly owned such an establishment.

    As for the Project Manager, right now, its ill defined as a role.

    The “responsibilities” and the “control” is shared among both the President and Marketing.

    Right now, its the marketing guy that’s taking responsibility of sizing the project, while President is the one who gives approval.

    It’s not possible to be an effective Project Manager without having both those together. So, even if the Marketing guy, which he plays the role of PM very well, wants to size and cut, he can’t move forward without the approval of the President, which he loves adding, but not compromising.

  • It sounds as if lots of people there should read The Lean Startup.
    The thing that worries me most is that you put the Project Manager in the “add boat-load of features” camp. That role is perhaps the most critical in managing these challenges. That’s the person you need to work on.

  • Mark Bonasoro

    I have pretty much the same problems at a company I am contracted to work for.

    It’s like neither sides understands how things work. Been having hard times trying to convince both sides.

    I have on one end, the upper management, Clients, President, CEO, Marketing, Project Manager, who love to add boat loads of features, whom have a hard time understanding the software development process, stuff that takes long to work, mostly because the tools are new and “unproven”, therefore take more time.

    On the other end, the development staff (lower) of a few the have a hard time understanding the business end. Some think we got an “unlimited” cash flow and it should take nearly all the time in the world just to do the most perfectly looking game.

    I think the main problem is that none of them knows their strength and weaknesses, so we tend to be overambitious with everything, thinking more tends to be good. When they should realize their strengths and weakness and work on something that focus on what they are good at.

  • Really? I’ve worked in big corporate and small startups. I’ve consulted to others. I still see marketing teams frustrated with how slowly the tech team is moving, tech teams who think that the marketing teams are stealing their energy, finance teams who all about “management” and not enough about “enabling”.

    If you work in a business where everyone understands the role that each separate team does, and why it is valuable to the whole, congratulations. It means you have a great senior management team.

  • Yes, I know that the analogy isn’t perfect. No one likes being thought of as being a cog.

    But a business is about all of the different parts – sales, marketing, production, finance – working seamlessly together to make something that is much greater than the sum of the parts.

    The best analogy I could come up with was an engine. Can you give me a better one?

  • Busy

    Maybe it works like this in old style fashion business. Modern corporate models have no problem with that.

  • Tripitaka

    I AM your boat, mister. Now answer the question.

  • Are you my sailing boat? How did you get an email address?

  • Tripitaka

    Do you, as a human, recognize what is wrong with writing something like this?