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08/02/2012

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Got a million founder stories but won't go there without a book deal. Basically, founders are not necessarily smart: they are simply founders. That means they are entrepeneurial, hard-driving, stubborn, persistent, self-confident to the point of arrogance, universal experts, frequently dictatorial... you know the list. Those are NOT the qualities you find or desire in the typical team-playing Organization Man or Corporate Woman. It's no surprise when they are true to form.

My best "good paternalistic founding CEO" story was the guy who was too modest to take a salary above $300K at the $10 billion firm he headed. Yes, he personally controlled much of the public stock, so he took no bonus, either. (I have time-adjusted the numbers and will not identify the firm because it carried his name and is still well-known). I 'splained that his subordinate corporate COO/President couldn't afford to keep his kids in college at the compressed rate he earned because of HR's fear of permitting pay in excess of the COB's. Plus, all corporate officers and the heads of all the groups and divisions were further compressed. And there were other normal consequences like invidious internal comparisons due to the requirement to hire technical specialists at rates higher than the salaries received by superiors three levels higher, etc.

I convinced him that he could remain "modest" in his personal pay but MUST allow me to publicly publish the proven competitive market value of his JOB as the official "job value" (orders of magnitude higher than his pay rate) for proper appropriate classification of his position. The ripple effect of the consequences saved the enterprise from an early and untimely demise.

Jacque:

Great post, as always. The hand grenade story it a hard one to top!

Founders are a unique breed, to be sure. Perhaps the only people who really understand founders are other founders. Who else really knows what it's like to build a business from scratch, putting not only your time and energy on the line but (for many)also your house, your savings and your family's financial security. Or to lay awake at night wondering if you'll be able to make the next payroll. Or to start off with a product or service about which you know everything and end up (if you're lucky) at the helm of an organization demanding know-how and skills far beyond what you can grasp. Not many HR pros have walked a mile in those moccasins. I know I sure haven't.

I say this because I suspect we're looking at a door that swings both ways, and that some founder out there could write an interesting companion piece entitled "What is the Deal with HR People?" with a few stories of their own. Likely starring some bone-headed thing that I did or said (the list is long) in the service of some founder-run company.

Thanks for a thought-provoking post. I'll be interested to hear the thoughts and perspectives of other readers.

Thanks Ann and Jim. Just show I am a fair person I plan to write another article on founders' problems with HR. I hope to get a few to comment.

Great post. I too have plenty of founder stories, but I will share two good ones.

1. Founder was not the CEO, but was on the board. He worked on client-related projects because he liked to. I didn't even know he was the founder until 12 months after joining the company. Company never got too big. The founders were trashed by outside investors in a poorly designed sale...

2. Founder had the publicly traded company named after him, but long before it went public he ceded the role to a "business person" so he focus on the creative and future vision aspects. The company did well for a while, but ultimately faded away after about 6-7 years as a public company.....

So your stories have founders of very large and successful companies who were bears to work with. My stories have super-great and compassionate founders of companies who were nowhere near as successful. I am sure we can switch sides. I also have stories about founders who were mean and failed and nice but still succeeded.

The one common thread is that they were willing to lead and make decisions when others were mainly only willing to ask questions.

Once they become truly successful it is nearly impossible to get them the change their ways (examples of this in your stories and in Jim's). Our only hope is to keep writing articles that will provide new founders with the information they need to be successful without gaining too many bad habits!

Thanks Dan. Actually #1 was small company. But I do intend to have an article the next time I come up on the roster about how founders feel about HR. And I will have a shocking confession to make that will make you all grab your smelling salts!

On a parallel point, Jacque, your confession might not be that much more shocking than what Robert Townsend (author of "Up the Organization") told me when I called him to address an HR Conference I chaired. For the youngsters, his book, written when he was CEO of Avis in the late 1960s, was... uh... um... "rough" on the HR function. (Snicker!)

Ah . . .I think we already know what founders will have to say. I have asked them not to use any "bad" words though! No -- my revelation will be something else.

Thanks for everyone's comments.

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