Leadership Teams: Why Two Are Better Than One

The concept of "two-in-a-box" leadership has been examined extensively over the past few years. One of the most thorough discussions is in the HBR article The Leadership Team: Complementary Strengths or Conflicting Agendas. CEO/COO teams or "Office of the President" arrangements can offer great strengths, but may also introduce some sizeable risks, as Stephen A. Miles and Michael D. Watkins conclude.

In our own company, Fishbowl, we took the approach to a new level 2 ½ years ago. We create leadership teams not only for our top jobs, but for every management position in the company.

A bit of background: Fishbowl is the result of a somewhat rocky beginning. We became involved with the company, which produces inventory software, in 2004 when one of us (David) was sent by the prior majority investor to shut the fledgling company down. Instead, seeing the potential in the product and commitment of employees, we came up with financing to buy out the investor and keep the company operating. By the end of 2006 we had created the #1 most requested inventory software for use with QuickBooks and were solidly profitable.

After several years of solid operations, in January of 2010 we decided to put together pairs of people for all management jobs. We did this for several reasons: We knew that maintaining our exceptionally high growth rate would be increasingly difficult and wanted to prepare leaders from within to address those new challenges. We wanted to put our highest focus on the development of our people, and to cultivate their highest creativity and thinking, in addition to our focus on the development of our product and sales.

A lot of people thought we were crazy. Soon after we made the move, the economy was deep into the recession, and most companies had to reduce headcount to cut costs. Instead, we were adding managers and creating intentional redundancies. How could we justify it?

In fact, in our experience, the benefits of our approach have exceeded the not inconsequential costs. Here are just a few of the upsides:

•No hierarchy. We've flattened everything out. Every person is a leader, paired with another and supported by a team.

•Personal growth. We've allowed twice as many people to have leadership opportunities - an inherent succession plan that has resulted in strong employee growth in addition to company and revenue growth.

•More creative outcomes. We've chosen our pairs carefully - we align paired leaders for maximum contrast in thinking and analytical styles. For example, our product management leads include one partner who is "left brained" and one who is "right brain" dominant. One is linear in his style; the other creative. The result is a manifestation of true synergy.

Are there disadvantages to paired leadership? In the initial stages, yes:

•Tapping two people to fulfill one role requires a lot of resources. There's no question our payroll is higher because of our paired leadership strategy. However, in our experience the creativity and testing that goes into every program or key decision creates a net savings over the longer term.

•Some of the individuals who get paired don't particularly like each other. We had an instance like this. We have a culture where people are very open (though not disrespectful). Two of the key individuals we partnered cornered us with persistent questions. What if we can't agree? Who arbitrates? What if one partner is holding the other one back? Ultimately, they adapted. At present, it's fair to say that if we changed the model, the majority of our team would be extremely disappointed, because they've come to appreciate the shared responsibility model.

•What about succession when the time comes that one of the teamed partners is promoted and the other is not, or one of the team members is gone? In our own company we have created a culture that is vastly different than the typical corporate environment. Our turnover is near zero. But when a leader does find his or her place elsewhere, we still have a leader in place. We can develop and assign a new partner and we generally don't miss a beat.

One of the greatest benefits of paired leadership that Fishbowl enjoys is that a trusted partner can provide essential feedback that helps to keep egos and guesswork in check.

We also believe that what we call the The Five Non-Negotiables must be present for a paired leadership program to work: Respect, belief, trust, loyalty, and commitment. We test all decisions against these characteristics. Paired leadership is so fundamental to our management style we would never consider going back. Two really good leaders - together - produce great outcomes consistently. Our company is thriving, and we have personally fulfilled employees who produce out-of-the-box initiatives every month. Perhaps it could work for your business as well. We welcome your thoughts.