Advice for CEOs

Newport Board Group, a national professional services firm of CEOs and senior executives, asked our partners to recommend how CEOs should grapple with changes that are transforming how middle market companies recruit, evaluate and retain talent.

Talented, committed employees, motivated by the upside they see for themselves in their employer’s success, are the best source of a company’s competitive advantage. But CEOs of emerging growth and middle market companies must face the reality that their workforce is changing rapidly. Workers and employers don’t expect jobs to last as long as they did in earlier generations. Companies can opt for alternatives to permanent employment, such as outsourcing work to an external service provider, deploying short-term contractors or using the services of a professional employer organization (PEO). Talented millennials and other younger workers bring an independent attitude and (often) a freelancer mentality. The internet has transformed recruiting and made it possible for even small firms to tap workers located on the other side of the globe.

Rick Williams, a partner in Newport’s New England practice, recently published this article on the web site of the Boston Business Journal.

Spin offs are an important topic for executives and investors in today’s entrepreneurial economy. A powerful trend is enhancing the supply of spin outs: public companies face pressure from activist investors to spin off operations that, in the view of the activists, depress the stock price because they are not synergistic with the company’s other lines of business. Activists typically claim that these operations represent a misallocation of capital and management time and attention. As for demand to invest in spinoffs, private equity and other financial investors often see a promising upside in the business that--as a standalone, with its own strategy and investment and an intensified focus--can realize its potential better than it could as part of a larger entity. For their part, strategic investors may think they can better unlock synergies with other businesses than the former owner could.

The success of a CEO has a lot to do with the performance of their Chief Marketing Officer, Manager of Sales or other executive who heads the sales force. Traditionally, sales managers have been successful salespeople.

Some of the best advice that a CEO can get is from those who have walked in their shoes. We asked a group of CEOs who happen to be partners in Newport Board Group: “What is the best advice you could give a CEO trying to take their company from $5 million to $25 million in revenue?” In our next several blogs we present their responses.