Robert Ochtel’s Blog

An Experienced Approach to Venture Funding

Dealing with Crisis Management in the Typical Day of Start-up Company CEO

More often than not, as the CEO of a start-up company, you walk into to work to start your day and accomplish your planned tasks and then everything changes.  You are immediately in the middle of multiple crises.   Your Vice President of Sales quits.  You find out that it costs twice as much as planned to develop your product offering. You learn that your newest product offering has been delayed three months due to an unforeseen development issue.  What do you do?  Your original plans for the day are shot, and you now have to address multiple crises to address that are each individually important to the success of your start-up company. In addition, you have your investors breathing down your neck to secure customers and revenue.  This is just a typical day in the life of a start-up company CEO.  It is crisis after crisis, with each situation requiring immediate attention and direction on how to solve the problem at hand. It is not an easy life, but it is very typical. In what follows is a short discussion regarding some answers on how to manage these recurring crises situations as they occur in the typical day of a start-up company CEO.

Step Back and Separate Yourself from the Situation

When a crisis or a series of crises hits, the first thing to do is to step back and separate yourself from the situation.  Reacting emotionally or providing a knee jerk reaction to the situation often will only make it worse. By stepping back and evaluating the situation from a non-emotional standpoint you can then:

  • Gain perspective of the issue(s),
  • Fully understand the implications of the situation,
  • Understand your options, and
  • Offer a more thoughtful solution to the situation.

 Self-separation also allows you to look at the situation from the 30,000 foot level. Often when individuals come to you with a problem, due to their past and present involvement, they are emotionally tied to the situation. This often clouds their judgment and does not allow them to think with the appropriate perspective regarding the situation at hand.  By separating yourself from the situation, you can provide unique insight into the crisis that needs to be solved and often offer other options that would not be considered by someone directly involved in the problem or situation.  So, first separate yourself from any potential crisis situation.  This will provide you with a better problem solving perspective.

Establish Priorities

With more than one crisis to solve simultaneously, the first thing you need to do is to prioritize these individual problem situations. Not all crisis situations need to be solved immediately.  Some should be addressed today, some may be addressed tomorrow, and some can even be addressed later this week or even sometime next week.  As the CEO of the company, you need to look at all of the crises that need to be addressed and prioritize which one(s) need to be put on the top of your list for today.  The other crises you need to respond to can often be addressed tomorrow and at some point within the immediate future. By prioritizing the crises situations, you have provided yourself some space and time to address the most immediate crisis that requires your full attention.  The other crises on your newly established priority list will get your attention as you solve the most immediately pressing problems or issues facing your start-up company.  So take the time to establish priorities to the crises you face, this will allow you to focus all of your attention on an immediate problem or issue as required, and provide you with the ability to move on to the next crises as other higher priority problems get resolved.  

Break a Crisis Down into Smaller Steps

Not all crises can be easily solved.  In fact, many times an individual crisis is very complicated and will take weeks, if not months to solve.  In these situations it is best to break the crisis situation down into smaller steps and then focus on those steps individually.  Everything is solvable. But, often a larger crisis situation will require you break it down into smaller steps and solve these steps individually on your way to addressing and solving the overall crisis.  This is important, as it is often much easier to get your arms around the smaller steps of the crisis, than that of the overall crisis.  In addition, it is often that by solving the smaller steps of the crisis that you come up with other more effective solutions to the overall crisis.  So, break your individual crises down into smaller steps.  This will allow you to solve the overall problem in a more efficient, effective manner.

Crises management is often par for course in the typical day of a start-up company CEO.  To be effective and efficient in addressing the number of daily crises that will come your way, you need to step back and separate yourself from the crisis, establish priorities, and finally break the individual crisis down in smaller manageable steps.  By taking this approach to addressing the daily crises that come your way, you will become a much more efficient and effective CEO of your start-up company.

This information was taken from Robert’s new book: “Business Planning, Business Plans and Venture Funding – A Definitive Reference Guide for Start-up Companies”.  Available at www.amazon.com.

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July 19, 2010 - Posted by | Venture Capital | , , , , , ,

1 Comment »

  1. Very accurate and relevant thoughts, Robert. While I like to assess my gut reaction to a crisis, I try to wait and gather all information and options before moving forward. That approach has also helped me to become much more adept at dealing with crises in a productive way.

    Comment by Carey Ransom | July 26, 2010 | Reply


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