3 Critical Questions CEOs need to ask themselves before they hire a Chief Revenue Officer Posted on August 01, 2021
The role of Chief Revenue Officer has evolved into a core executive function within modern B2B businesses since its emergence over the last 6-8 years.
B2B CEOs in the tech sector now consider CROs as core pillars of their leadership structure. CRO is the “hot” new title in the B2B space. The coveted title comes with many spoils: Prestige, Power, Credentials and the promise of future opportunity.
However, the appointment also comes with huge expectations and risk. Often, CROs are seen as a miracle-worker, rainmaker and a mover and shaker who will come to the rescue by taking the company to the next level of sales revenue growth.
It’s no wonder then that many CEOs have a relatively narrow view of the qualities that an effective CRO needs to bring with them into an organization.
Equally, very few organizations prepare themselves properly for the advent of their first CRO.
False expectations and under-preparedness can lead to less than hoped for results, frustrations and wasted expense, time and effort. The risk for a CRO appointment to go wrong is huge, as are the consequences, for the CRO, for the organization and for the CEO.
Here at the CRO Collective we have observed a myriad of perceptions as to the actual responsibilities of a CRO.
- How does a CRO function, really?
- Where does a CRO ideally sit within our organization?
- Where should their focus be in order to be effective?
- What are their areas of oversight, scope, remit and accountability?
- How can a CEO support their CRO’s success?
This lack of clarity can have dire implications to firms who currently employ CROs, as well as for those considering adding one to their leadership stack. The risks of getting it wrong are huge, but so are the rewards for getting it right.
With that, three important questions become apparent:
1) What are the REAL signs that an organization needs a Chief Revenue Officer?
The answer may come as a wake-up call to CEOs who seek a magical rainmaker. Without a clear understanding of why a CRO is needed and what their actual role should be within the company, a half-million-dollar compensation package could quickly turn into a bad investment and risk loss of revenue, reputation and personal advancement.
For a leader this critical to the success of the organization, we recommend CEOs first ensure that:
- Their own personal understanding of the role is solid.
- The company is structured properly set up to enable the significant outcomes that a CRO is brought in to deliver. Without the right culture and organizational design, even the most qualified CRO will have a tough uphill battle to fulfill their remit and live up to expectations.
2) What is the proper structure and culture that a CEO must create in order to successfully bring in a CRO?
- What needs to be in place before a CRO joins us?
- Who needs to be involved and signed-on to ensure a CRO can be successful?
Let’s face it, without the right foundation, a CRO placement can turn from an opportunity for renewed growth into severe business disruption that can plunge the business into chaos.
Once the organizational structure and culture are in place, it’ll be time to bring in the right CRO to activate the new growth and revenue success. Yet, the hardest part is still to come. A CEO must not merely rely on recruiters. For an appointment of this strategic nature they must first know how to identify, find and attract a good CRO.
3) What are the qualities of a good CRO, and how does a CEO find the right one?
Without first having a very clear understanding of the right qualifications, attitudes, experience and skills that a good CRO must possess to be able to hit the ground running and to perform from day one.
Once the qualities, competencies, skillsets and characteristics of a good CRO are clearly defined, a CEO will have a proper benchmark to evaluate
candidates. This clarity will mitigate the risk associated with bringing on an extremely expensive executive – and who will have a massive impact, good or bad, on the business – who is wrong for the job and for the organization.
Bringing in a CRO could be the greatest thing for a CEO, or it could turn out to be an unmitigated disaster.
The CRO Collective uniquely helps B2B companies assure CRO Success.
We work with CEOs of B2B companies to build CRO-Ready organizations and find the right CRO who will make a significant impact on the business. Our CRO Collective Membership Forums help ensure that current or aspiring CROs are successful in the role from Day 1.
To evaluate your own CRO readiness, I invite you to complete our CRO Readiness Checklist. In just a few minutes you will gain clarity on what you can do to give yourself the best chance of success when hiring a CRO.