Does shared power work? Does it create accountability and diversity of thought, or does it create a potential for power struggles and egocentric infighting?
With the announcement that the Co-CEOs of RIM, the makers of BlackBerry devices, were stepping down after the once-proud company has suffered through massive loss of market share, this question is in the mind of many business leaders.
Back in June, citing earnings power, poor product futures, poor communication and increases in popularity of competitors, USB analysts slashed their price target 25 percent (from $60 to $45). The analysts also made clear their doubts about the executive structure of RIM, signifying there is a problem not with the persons but with the co-CEO leadership itself:
“We are also not convinced the current management structure — co-Chairmen, who are also co-CEOs, and one of whom is now CMO, is the optimal one either…”
New RIM CEO, Thorsten Heins, now has the task of not only guiding the company through a rough transition and increasing investor confidence, but also is operating under a different power structure than the one he inherited. The rise of iPhone and Android smart phones has put the Blackberry maker in a difficult position to rebrand, rethink and reorganize of they’ll continue to lose market share.
Even as RIM was struggling with Co-CEOs, Deutsche Bank was installing an executive duo in July. Anshu Jain and Jeurgen Fitschen were brought in to increase profits and long-term strategy. For Deutsche Bank there has been a rise in stock price, at time of writing, following a steady down fall of share prices following the installment of Jain and Fitschen.
Is there an answer for the co-CEO conundrum? There is no simple answer in executive recruitment and there is no such thing as a Successful CEO Guarantee. While the USB analysts cited the co-CEO structure as a problem for RIM, other companies like Whole Foods and J.M. Smuckers, have see success as with shared CEO responsibilities.
When considering a co-CEO structure, ask yourself:
- Why are we considering Co-CEOs?
- What problem might this structure solve?
- What confusion could it create?
The analysis of the problem and the development of the solution is key in the recruiting process. If we decide that there is a benefit to a co-CEO structure, we need to ensure that the candidates have complementary skills and approaches, as even great leaders can have conflicting styles. After you define the required competencies for each role, you need to validate that each candidate possesses those competencies and has the personality to work collaboratively with their counterpart. It’s not about the structure of your C-suite, it’s about the balance and performance of competencies.