Are two heads worse than one?

In a recent column in the Financial Times, business writer Andrew Hill reflected on the departure of former co-CEOs Jim Balsillie and Mike Lazaridis from Research In Motion, the troubled BlackBerry maker.

Hill acknowledged that RIM's problems -- the company did not respond quickly enough to challenges from iPhone and Android -- could also have occurred at a firm with a single CEO. "That said," he added, "I nurse an innate suspicion of co-chief executives."

And indeed, according to a January 2012 article in the Toronto Globe and Mail, the co-CEO arrangement at RIM may have played a part in the Waterloo, Ontario-based company's inability to quickly produce a smartphone that rivaled the functionality of the popular new competitors. Some RIM employees, the article said, "believe the unusual two-headed structure of the company ... slowed things down."

What's more, the Boy Genius Report blog noted in July 2011 that Lazaridis and Balsillie had "titanic" arguments in front of employees.

In his FT column, Hill wrote that many family firms use the dual-CEO structure and that "toxic sibling rivalry" is often a byproduct. (You knew he would go there, right?) To prove his point, he cited the case of Robert Mondavi Corp., where rivalries between second-generation co-leaders Timothy and Michael Mondavi repeated a pattern established in their father's generation. (After feuding with his brother Peter at the family's Charles Krug Winery, the elder Mondavi left to form his eponymous company.)

But not every co-leadership arrangement -- in family or non-family firms -- is doomed to end in disaster. The key is to ensure that the partners at the top respect each other, define their respective roles in the partnership, and present a unified front to the staff.

"Build in lots of communication on a regular basis," family business adviser Jim Barrett wrote in a 2003 Family Business Magazine column on co-leaders. "If they don't enjoy each other's company or are content merely to trust each other, this ain't gonna work."

At our Transitions East 2012 conference in Orlando, Fla., to be held April 25-27, brothers Ben and David Grossman, co-presidents of Grossman Marketing Group, will discuss their focus on alignment of interests, and how each brother celebrates his sibling's success as his own. They signal to each other through a window between their offices.

In my years of working with family businesses, I've found that co-CEOs can work quite well together -- if the leadership team members are willing and able to work on their partnership. One of the issues that must be resolved at the outset, for example, is how deadlocks will be resolved.

Co-leadership arrangements don't inevitably lead to "toxic sibling rivalries." And it's also important to note that "toxic rivalries" can occur even if the co-leaders are not related by blood.

Posted Friday, February 17, 2012 • 0 Comments • Permalink

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Barbara Spector