You’re halfway through the year. Are you where you thought you’d be?
Why every CEO should stop and reassess this July 4th
We held ourselves to an extremely high standard of strategic coherence, and we revalidated that strategic coherence over and over again, especially through the early years of the company. And that intellectual honesty with ourselves about does our strategy makes logical sense in light of all of the changing inputs and new facts. — Marcu Ryu
That’s Marcus Ryu, Co-founder and former CEO of Guidewire. His company transformed the insurance industry and grew into a public company generating over $1.5 billion in revenue.
If you’re on a calendar fiscal year, you’re exactly halfway through it. And if you’re in the US, you’re heading into one of the quietest stretches of the year outside of Thanksgiving and Christmas. This is a rare opportunity to get out of the weeds and actually assess how your business is doing.
In my experience, 100% of the time, you’re not where you thought you’d be. Some things are ahead, and some things are behind. That’s okay. The problem is when you don’t stop to honestly account for it and readjust your plan for the second half accordingly.
Here’s exactly what you need to be thinking about and doing this time of year.
Table of contents
Take stock of where you are
Decide what to change in the second half of the year
Communicate the changes
Take stock of where you are
You’ve been in the weeds for six months. You might not even know what’s happening in and around your business. This is the time to zoom out and evaluate where things are.
Ask yourself these questions to better understand the state of your business:
Is the top-line revenue where you expected? Did you get there the way you expected?
Is churn or gross retention better or worse than planned? What are the driving factors?
Did something shift in the market? A new competitor, an acquisition, a feature that landed differently than expected?
Did you deliver a feature that wasn’t adopted? Did a small enhancement unlock a massive opportunity?
Did you hire a game-changing employee? Did a key person leave?
Did you think you were going to fundraise, and it didn’t happen? Did you end up raising earlier than expected? Did you raise more money than you planned?
You can’t improve what you don’t measure, and you can’t fix what you won’t face head-on. The CEOs who know something is off but decide to stay the course are the ones who dig themselves into a hole that gets harder and harder to climb out of.
Decide what to change in the second half of the year
Now that you know where your business stands, it’s time to look forward and implement the necessary changes. The time to change is now. Don’t wait, and don’t overthink it. Make the tough calls.
Ask yourself these questions to determine what you need to change:
If your retention rate is behind the goal, is it realistic to get it back to where you originally thought it would be?
Should you keep investing in that new product or feature you’ve been building for six months but haven’t delivered?
Do you need to triple down on the small team focused on AI?
Is that ICP still the right ICP? Are those territories still the right territories?
Does something need to change in how your leadership team meets or how you run your company all-hands?
Are there bets you made in January that aren’t paying off?
Are there things working better than expected that deserve more resources?
Just because you committed to doing something at the start of the year doesn’t mean you should keep banging your head against the wall. Things change, and in today’s market, they change faster than ever. You can’t plan for a year and never stop to reassess, that’s just stupid. It’s the same reason the old school waterfall methodology fell out of favor. The world changes too fast for that.
Communicate the changes
Once you’ve done the thinking, it’s time to rally the people: your co-founders, team, investors, customers, and partners.
Here’s how to get everyone on the same page:
Start with your inner circle. Bring in your co-founders, your executive team and share what you’re seeing. Have them poke holes in your plan. They will most certainly catch things you missed.
Align your board and investors. Even if the top-line number stays the same, if how you’re getting there has changed, you need to communicate that. The board and your investors care about the number, but they also care about what’s happening underneath it.
Tell the company. Change is hard. Some people have a hard time with change, no matter what is changing. Your job is to build your team’s resilience around the change, help them understand why things are changing, and make it clear that this is the plan evolving, not failing.
Inform external stakeholders: Your customers and partners don’t need every detail, but if something material has changed, don’t let them hear it through the grapevine. A proactive heads-up will build more trust than a reactive explanation.
Communicating the change can be scary, but you have to do this to survive. A lot of CEOs and founders see this as a failure. But if you do this right, you’ll earn more trust from your board, your team, and yourself than you would have by staying the course. Don’t pretend everything is on track just to avoid difficult conversations. That’s the path to failure.
The best CEOs never stop reassessing
July 4th is a rare vantage point. You’re exactly halfway through the year, and things are slowing down for a few days. You have the space to actually think. Use it. Take stock of where you are, decide what needs to change, and then communicate it. It’s not a failure to change the plan.
With all of that said, find a day, or at least half a day, to put your phone down and recharge. You won’t be 100% present no matter what you’re doing this weekend, but you can (and should) carve out some time to recharge.