Explore the effectiveness of co-CEOs in running companies, drawing parallels with parenting. Discuss the rise and fall of Research in Motion, the company behind Blackberry. Discover success stories of co-CEOs in Goldman Sachs and Atlassian. Learn about the challenges of working alone on software projects and the benefits of pair programming.
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Quick takeaways
Co-CEO pairs in large public companies outperform solo CEOs, delivering higher annual shareholder returns, suggesting the co-CEO model's potential in the business landscape.
Co-CEOs face challenges and risks but when the fit is right and they have complementary skills, the benefits of shared leadership outweigh the risks.
Lori Williams' research on pair programming shows that collaboration and shared responsibility improve decision making and problem-solving, extending beyond the executive level.
Deep dives
The Benefits of Co-CEOs in Large Public Companies
A study conducted by CEO advisor Mark Feigen found that large public companies with co-CEOs outperformed those with solo CEOs. The co-CEO pairs in the study delivered annual shareholder returns nearly 40% higher than solo CEOs. While the finding is not entirely robust, it suggests that the co-CEO model deserves consideration in today's complex business landscape. The ability to share responsibilities, make collaborative decisions, and have a partner for support and guidance can lead to improved performance and decision making.
The Challenges and Risks of Co-CEOs
Co-CEOs face challenges and risks related to role confusion and decision-making authority. The need for clear communication and alignment becomes crucial for success. Some prominent examples, like Blackberry and Allbirds, highlight how conflicts can arise and lead to the downfall of the company. However, when the fit is right and the co-CEOs have complementary skills and a strong partnership, the benefits of shared leadership can outweigh the risks.
Lessons from Programming Pairs
Lori Williams' research on pair programming, where two software engineers work together on a project, reveals benefits similar to co-CEOs. While pairs may work slightly slower, they make fewer mistakes, produce better quality work, and experience higher satisfaction. Communication and collaboration are key in pair programming, leading to improved decision making and problem-solving. This suggests that the benefits of collaboration and shared responsibility can extend beyond the executive level.
The Importance of Compatibility and Trust
Both co-CEOs and programming pairs thrive on compatibility, trust, and open communication. It is essential for the co-leaders to have complementary skills and a shared vision for the company. Trust and respect create an environment where ideas can be shared, challenged, and refined for better decision making. While co-CEO arrangements may not be suitable for all companies, when the fit is right, they can result in more innovative thinking, better risk management, and improved outcomes.
The Future of Co-CEOs
While the co-CEO model may not become mainstream in the largest companies, it is likely to gain more traction in smaller companies and partnerships. Co-CEOs provide an opportunity for deeper collaboration, increased accountability, and improved decision making. As research and examples continue to demonstrate the value of shared leadership, more companies may consider adopting the co-CEO model as a strategic choice.
If two parents can run a family, why shouldn’t two executives run a company? We dig into the research and hear firsthand stories of both triumph and disaster. Also: lessons from computer programmers, Simon and Garfunkel, and bears versus alligators.
Jeffrey Sonnenfeld, professor of management studies and senior associate dean at the Yale School of Management and founding president of the Chief Executive Leadership Institute.
Laurie Williams, professor of computer science at North Carolina State University...
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