WORKING WITH THE BOARD ON YOUR COMPENSATION AND REVIEW
In Corporate America and certainly in the land of startups, the board’s biggest, weightiest, and most important responsibility is probably hiring, firing or compensating the CEO. In this chapter, I’ll focus on compensation, which really means performance management and compensation.
THE CEO'S PERFORMANCE REVIEW
As I mentioned in Chapter 11, some kind of formal performance management process on you as the CEO is critical. It will help you understand the impact you're having on your organization, your strengths, your weaknesses, and your road map to being a better CEO.
You're not the only customer for your performance review. The board is an equally important customer. How can they properly figure out your compensation and guide you as your boss if they're not contributing to and reviewing your performance appraisal each year?
The three most important things about your performance appraisal are that you:
- Have one. This is where 90 percent of CEOs fall down. Even though your board, as your boss, should do this, you are the leader of your board—regardless of whether you are chairman. Lead them in this process as you would anything else
- Publicly acknowledge the results of your appraisal. This is Step 1 toward internalizing the feedback and making public commitments about acting on it, which leads to Step 3.
- Act on it! Feedback is a waste of everyone's time if you don't learn from it and drive self-improvement, ...