ExpertCEO

Given that this site is a resource for peer assistance among smaller or privately-funded companies (not typically larger or public ones) it’s interesting that the posts driving the majority of actual discussion relate to just three topics:
- CEO compensation
- Board dynamics
- Driving sales

When I read it from the bottom up, it says “Sales is the only thing my Board responds to positively, and they control my pay.” Clearly these are weighing most heavily on our collective minds. Did our Boards hire us to run a company, or to be the VP of Sales?

I run a venture-funded startup that has raised tens of millions of dollars. I am consumed daily with strategy, team effectiveness, organizational efficiency, and managing to accountability across a broad range of our operating activities. Yet I admit that these issues all get trumped in my conscious thought by the three topics above.

My Board hounds me about cutting burn, and when I do it has zero reflection on my compensation. The same holds true for creating the right strategy or successful product delivery / marketing / partner acquisition / compliance / audits / great hires / leadership… all the other things that a true company requires. Zero credit; the only thing that seems to matter is the three-tier hierarchy above.

Is it just me, or is this reflective of most of our Boards? It seems so utterly suboptimal.

I couldn't have said it better. In my company, the only thing that matters to the Board is sales. The hiring of the team, operations, effective marketing, alliances all do not get reflected on compensation. Only sales matter and that is what drives a lot of the discussion at Board meetings.

At the end of the day, everything we do is to ensure that the sales grow. All the work on strategy, team effectiveness, organizational efficiency, and managing to accountability (as you said) ultimately equate to more sales and this is what matters.

However, thinking out loud here....it is in our hands (yes, the CEOs here) to propose a "Balanced Scorecard" to the board and at the very least ask them whether they would consider compensation and especially bonus structured on the other factors. I've been thinking a lot about this for next year - it will take many months to ease them into this mentality before the next year comes around.