DILEMMA: A year ago our US business looked ready to roll. Chuck Happer, the US CEO, got off to a great start, recruiting a strong team and getting a superb reaction in the market. But sales have been slow to materialise, costs look out of control and some of Chuck's star team have left. I think I should fire him, but how? And does that mean it would be best to withdraw from the US completely?
ISSUES: How on top of the US business are you? Is it fundamentally viable? Do you really understand the market? Are problems a result of poor execution or a flawed strategy? Were you just a little bit too optimistic about how long those sales would take to come through?
If the strategy is flawed and you need to withdraw, how can you minimise the damage? A proper financial analysis of the options is required either way - finances may well be the deciding factor.
Who's been managing Chuck? Has he failed to meet clear objectives? If you decide to fire him, then it will certainly help to hold the commercial high ground.
What's the process for firing him? Will you do it yourself? Will you line up a successor and have you got one internally? Recruiting someone from outside will take months. Is an interim CEO feasible? If you are closing the US, who's going to do it? How will you avoid it leaking out beforehand?
You need to be clear on the order of events and who to draw into your confidence. Dealing with this issue could be time consuming, so decide what you can delegate.
Then there's Chuck's contract with the company. You'll want to avoid a protracted legal dispute - US employment lawyers don't come cheap - and, however galling, it might be better to make him an offer he can't refuse.
Internal and external communications will be a challenge. Plan who you need to speak to, and work out when and how.
- Decide whether your US business is fundamentally viable.
- If you need to fire Chuck then get on with it. The cost is rising!
- Get good advice. Write out a proper plan, particularly with regard to the communications and timing of events.
- Ensure you have a strong successor and support them well.
- Finally, your own confidence will have taken a knock, so remember that resilience is a hallmark of the successful.