By KRYSTLE CHOW
Published in the Ottawa Business Journal newspaper and website.
Feb. 11, 2008 (Feb. 13 on OttawaBusinessJournal.com)
Fidus founder Michael Wakim is enjoying a deserved sabbatical from the company, but he says one of the hardest things was unplugging and getting used to having the time off.
Photo by DARREN BROWN for the Ottawa Business Journal
It’s not often that you see a CEO taking a break from a busy, growing company, but when Fidus chief executive Michael Wakim decided it was time for a sabbatical, he found a reliable stand-in with his interim president, former Tropic Networks CEO Kevin Rankin.
So what do you do when you’re thinking of taking a long break and need an executive replacement, or if you’re looking for someone to fill a hole while you search for a more permanent person to take on the role? The OBJ spoke to Mr. Wakim about how he found Mr. Rankin, and other tips to finding the perfect interim executive.
OBJ: So why did you decide to do this interim hiring?
WAKIM: I’m part of the Mindtrust group of CEOs in Ottawa, we meet for breakfast once a month and it’s a really helpful time … I’ve gotten to know the people that go to Mindtrust quite well, and when I was looking for someone to help me at Fidus, naturally I looked at some of the people I’d made friends with in the Mindtrust group, and Kevin was one of them.
The reason I wanted to do it was because the company was doing so well that it couldn’t have been a better time. We have a record backlog of work that needs to be done, four-months worth of projects and financials are the strongest they’ve ever been, so I thought it was the best time I could possibly think of to take a break.
OBJ: It’s rather an unusual step to take a break from a busy company that you’ve founded and hand over the reins to someone else, isn’t it?
WAKIM: It’s hard to believe but the company is over six years old now and it’s grown by 20 or 30 per cent every year for six years in a row … It never would have been the ideal time; if I’d waited another year, it would have been no different, I don’t think. It might seem a little bit strange taking time off from a company, but … it can be really, really exhausting when you start a company with your own finances, hire people, deal with customer issues and employee issues for 70 people, especially if it’s a company in which you really care about the people.
OBJ: So how did hiring Mr. Rankin help with that process of taking a sabbatical?
WAKIM: The reason why this is working so well is because Kevin was looking for a position where he could have the summer off again this year. He had been working extremely hard at his last company for the last six or seven years and I think it had taken a toll on his family life and apparently having last summer off was like a major benefit to him and his family … It was just an incredible coincidence that his family deeply desired that he would be free again for the summer and I wanted a break that was exactly that long.
In the middle of July there’s going to be a one-week overlap. It’s good because I like riding my bicycle to work and summer is perfect biking season. I didn’t want to miss that.
What’s going to happen after that, I don’t know for sure. I would like to see Kevin keep up maybe as a board member or adviser to the company of some sort, or anything. I guess I was sufficiently wanting a break that I didn’t even want to worry about that far out, because the company’s super-healthy, I’m happy, Kevin’s happy, the employees I know them very well so they would call me if something was up and the ones I’ve talked to say everything has just been fantastic. I guess since nothing’s broken I’m not going to worry about it. He might have a role in the company if he really likes it.
OBJ: So what was the selection process like besides using your involvement in Mindtrust?
WAKIM: One thing I made heavy use of was my board of directors, I wanted to find somebody that every member of the board was adamant about being the right person, so I did look at a couple of other possibilities and casually floated those ideas past the board members and got mixed answers in some cases and a couple of times they said “Mike, why are you thinking of this, just keep doing what you’re doing. If you need a vacation take a vacation. Please don’t talk like this.” But when I floated the idea of Kevin to a couple of board members – one of the board members even had invested in Kevin’s prior company … and he said yes, absolutely, he’s the guy, he’ll be great. Then I checked with the other two board members and I got the exact same answer.
In my case I used the personal endorsements of each of my three board members and I consulted with some people in town that I consider to be mentors who also felt that this was a very good choice.
OBJ: What sort of tips do you have for executives who are in your same situation and are looking for an interim replacement?
WAKIM: Tip number one is consider something like this when things are really really good at the company. I think the natural tendency of people is when things are fantastic to go, “Wow, I’ve tons of business, lots of money, everything’s fantastic, I’m just going to stick with this, because I’ve gone through some really really hard times and now things are fantastic, why would I ever take a break now?” That’s the opposite, I think, of the way they should think of it.
Don’t consider trying to find a guy to take over for you when things are terrible, so that they’ll somehow fix it for you, that’s when you’re needed the most, during the dark times. And when the times are really really plentiful, that’s when you’ve earned a break, don’t be embarrassed to let someone else enjoy the good times.
The other thing is, there are benefits to having a strong management team and one of them is being able to do things like this. Invest time in finding managers that really truly care about the company and work well together, so that that can allow for such a break to happen. A lot of times CEOs, especially in smaller companies, feel like they have to control everything … and they think they’re protecting themselves financially, from betrayal and things like that. This actually isn’t the case … my two most trusted employees … have full signing authority on our chequebook for example, so if I’m travelling and the bookkeeper needs a bunch of cheques signed, she can go to one of the guys who’s just a regular designer that just loves to design circuits, and he can sign cheques and he does that regularly when I’m away. So I’ve got a structure in place where there’s enough people that are truly trusted within the company that it affords me the ability to take such a break.
THE EXPERTS SAY
You need to clearly enunciate and articulate what role you want someone to step into and what your expectations are for the role for that period of time. The founder or CEO who’s looking for a replacement must clearly articulate what the business is and what the fundamentals are, like the culture, environment, human resources and the people … Also be very clear with intentions and whether you’re saying “I’m coming back for sure” or “Hey, if this works out, maybe there’s a job there.” I don’t think you can say to a potential candidate that it’s one or the other, because to the first one you’re saying “Enjoy running the company but keep it stable,” and the second one is “Show me what you can do so I can see if you should have my job.” They’re very different messages.
Debbie Weinstein, founding partner, LaBarge Weinstein and Mindtrust
You need to find someone who has the experience of being in that role before and has a reasonably good track record so you can take the time to find a replacement. And the most important thing is you need someone who will take the time to understand what the shareholders are looking for of someone in that role. Do you want to keep things “steady, Eddie,” shake things up, or a bit of both? The key thing is someone who pays attention to making the investment up front to understand the needs of the company in the next six months. When considering if you want to go internally or externally, personally I think there’s a lot of merit to going outside and finding someone who comes with a fresh attitude and doesn’t have any baggage, although there are merits for going internally under the right circumstances too, because you’ve got someone who knows the inner workings of the company and can identify problems and strong or weak players immediately. But the disadvantage is if you don’t give them the job and recruit an outsider all of a sudden, what happens to their reputation?
Danny Osadca, co-founder, Mindtrust