Soriano: Is your organization suffering from ‘Founderitis?’ (Last Part)

·3 min read

To continue the last part of this four series article, I expressed to the founder my concerns about his constant interference that made it almost impossible to have two sets of hands on the steering wheel without creating an accident. As the group chief executive officer (CEO), it was my duty to steer the business where it should be and align the plans approved by the board. On the other hand, the founder’s role was to provide support during board meetings and continue to inspire the organization so it can singularly focus on the programs set. He acknowledged this fundamental separation of roles, but he continued to encroach on many decisions. His actions not only disrupted the organization but confused my senior management team, prompting one of his children to remark, “Is dad really serious in letting go?” In my case, it was obvious that founder’s syndrome had found its way and the leader continued to grapple with the need to reconcile his role with the new leadership structure.

Tired and exasperated, I gently suggested that we set up a working board where he officially assumed the role of non-executive chair and help me find new ways to grow the business using his network but leave the strategy execution to me as the CEO. It was a win-win formula for both of us, but unfortunately, the founder could not keep his end of the bargain. In my second year, our professional relationship worsened. I then asserted that if he continued to micromanage, I might as well exit. He promised to be mindful, but barely a month passed, he was back to where it started, overriding some of my decisions.

While I was pondering whether it was time to leave the organization, I made a call to a good friend asking his advice and he nonchalantly said, “Your work in this organization is over. Find as amicable a departure as possible, wish the owner the very best, don’t burn bridges, get yourself a reasonable financial exit package and simply move on.” I followed his advice and politely ended my engagement. Despite appeals from family members and the senior management team for me to stay on, I felt it was time to exit.

In my quest to find out why founder’s syndrome is so pervasive among many family-owned businesses, my research pointed me to professor Noam Wasserman’s book entitled Founder’s Syndrome and Rick James’ article, “What Stops Founders Letting Go?”

Founder’s choices are straightforward. Do they want to be rich or king? Few have been both and Wasserman pointed it out, “The reason isn’t hard to fathom: There is, of course, another factor motivating entrepreneurs along with the desire to become wealthy: the drive to create and lead an organization. The surprising thing is that trying to maximize one imperils the achievement of the other. Entrepreneurs face a choice, at every step, between making money and managing their ventures. Those who don’t figure out which is more important to them often end up neither wealthy nor powerful.”

Rick James, principal consultant of INTRAC, explained that, “Few founders can let go without help. They need challenge, encouragement and support along the way. For many founders, their leadership has become inextricably intertwined with their identity — their sense of who they are. Many no longer can fundamentally differentiate themselves from the organizations they lead or created. Their role as leader is a major part of who they have become. So they find it hard to sustain a meaningful life without their position. Their sense of self, their identity, has become confused with their job in the organization. They have become blind and unable to distinguish between what is for the organization’s benefit and what is for their own. We all need outsiders to help with our blind spots. This is a key role of the board.”

In closing, engaging independent directors or advisors in the board plus embedding a governance consultant to handhold the family, especially the founder, are wonderful steps in harmonizing the family and the business.

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