Imagine you've had a storied leadership career to date. You're hovering around the 18-22 year mark ... right at that point when a retained executive search firm approaches you about a great next step: successor CEO for a company where the founding CEO is participating in a search to replace him.
The stakes are high and you're interested.
After being vetted by the search firm, your first official meeting (don't call it an interview!) is dinner with the founding CEO. Skip to the front of the line!
Before you order the first appetizer, he ask you this: "So how large of a P&L have you managed?"
You've managed 400 people globally. You've managed budgets totaling 50 million dollars. You've mentored 12 high performers into senior leadership roles. You've driven several billions of dollars in annual revenue for crying out loud!
But you have to confess: "Well, I've never officially managed a P&L."
The founding CEO doesn't beat around the bush: "Well why the hell did they send you to me?!"
Dinner is over early.
This is a compilation of two people in my experience; both of whom had careers that many might consider exceptional. They both continue doing impressive work in tech. They're game changers in their fields.
But the P&L hiccup held lessons for both. Three lessons, in fact. One, P&L management matters. Two, not all search firms are built equally (the firm should have done better). Three, the CEO in question might have been short-sighted by not exploring a bit further.
The important lessons are still there for all to see.
Note that both came from flat organizations and neither had previously realized the importance of P&L management experience, nor been handed P&L authority. Both were walked to the door when they should have been walking through it. Both are now looking for ways to get their hands around P&L management ASAP so the issue doesn't flare up again.
As an aside, I recently began researching how many CEOs in the Fortune 500 founded their own companies or firms in the early parts of their careers, and the percentage is becoming convincing. Guess what starting your own company or firm involves? P&L management.
BlueSteps.com's "5 Characteristics a Senior Executive Must Possess to Assume P&L Responsibility" 2010 article still resonates today. Important read for management professionals with an eye on the C-suite or senior executives with a gap or two to fill before reaching CEO.