Building an Executive Leadership Team — Hiring Senior People Is the Easy Half

When a founder can no longer make every decision, the usual answer is to hire senior people and trust them to take over. The hiring tends to go well. What goes wrong is everything after it: the founder keeps deciding, the new executives become expensive advisers, and within two years at least one of them has left, saying they were brought in to lead and never allowed to. The problem is rarely the calibre of the hires. An executive team is built by what the founder hands over, in what order, and to whom.

We work with a lot of leadership teams in this transition, often in companies between one hundred and five hundred people across Saudi Arabia and the Gulf, and the pattern is remarkably consistent. The founder is sincere about wanting to let go. The structure around them makes it almost impossible.

"A very expensive adviser"

The founder of a logistics company in Jeddah had grown the business to around two hundred and fifty people and decided, correctly, that it needed a real executive team. Over nine months they hired a chief operating officer, a finance director and a commercial director, all from larger regional and multinational companies.

The weekly executive meeting went ahead every Monday, and it was mostly updates. The real decisions happened in the founder's one-to-ones, one executive at a time, which meant that no executive ever saw the trade-offs being made in the other two conversations. Pricing exceptions still went to the founder. So did any hire above team-lead level. When the commercial director resigned after fourteen months, their exit conversation was brief: "I was hired to lead the commercial side. I ended up being a very expensive adviser to someone who was going to decide anyway."

The founder was genuinely surprised. From their side, they had been consulting their executives constantly. From the executives' side, being consulted is not the same as deciding.

The Three Handovers

A group of capable executives becomes a leadership team through three handovers, and they work best in this order because each depends on the one before it.

1. Domains

Each executive gets a clear domain and written decision rights inside it: what they decide alone, what they decide with a peer, and what goes to the team or the founder, with thresholds attached. This is the least glamorous handover and the one founders most often skip, because it feels bureaucratic. Without it, every conversation about authority is renegotiated case by case, and the founder wins by default. Decision drift starts precisely where these rights were never written down.

2. The enterprise agenda

Next, the team, not the founder alone, takes ownership of a short list of company-wide decisions: annual priorities, major resource shifts, the few trade-offs between functions that shape the year. This is what turns a set of functional heads into a team, because it gives them something to own together that none of them can deliver alone. Keep the list short. Five company-level decisions owned collectively beat twenty on which the team is merely consulted.

3. Accountability to each other

Finally, executives start holding each other to account for the enterprise agenda, not only answering to the founder for their own function. This is the hardest handover and the one that makes the most difference. In a hub-and-spoke team, each executive's accountability runs to the founder, so peer friction is resolved by escalating it upward. In a real team, the commercial director can tell the operations director that a delivery promise is putting the year at risk, and the conversation happens in the room rather than in two separate one-to-ones. When it doesn't, the result is the pattern we describe in departmental ping-pong.

A quick way to see where your team stands is to count where decisions are actually made over a month. If most consequential decisions are made in the founder's one-to-ones, you have a hub with spokes, whatever the organization chart says.

Here's the contrarian part

Founders usually start this transition by hiring. We would start by writing down what you will stop deciding, before the first senior hire arrives. An executive who joins into written domains and a clear enterprise agenda has something to lead from their first week. One who joins into a founder's goodwill spends a year negotiating their authority, and the best candidates will not wait that long.

The second point concerns size. Once the team exists, the pressure is to add people: every function head wants a seat, and leaving someone out feels like a demotion. The leadership team should be defined by the enterprise agenda, not by the reporting line. Not everyone who reports to the CEO needs to sit on the team that sets company-wide priorities, and a team that grows past the size at which people can actually argue with each other turns back into an update meeting, just a larger one.

Why it works

Katzenbach and Smith's distinction in The Wisdom of Teams is the clearest starting point: a working group is a set of individuals who share information and each deliver their own piece, while a team shares a purpose and outcomes that require collective work. Most executive teams are working groups most of the time, and that is fine for running functions. The problem is when a company needs a team, for instance to rebalance resources or carry a strategy across functions, and has only ever built a working group.

Wageman, Nunes, Burruss and Hackman studied senior leadership teams directly in Senior Leadership Teams and argued that the conditions for team effectiveness are mostly structural: a clearly bounded team with the right members, a compelling shared purpose, and a structure that enables the work, with coaching mattering less than those foundations. Many of the teams they looked at were too large or had unclear membership, which matches what we see. Lencioni's idea of the "first team", in which an executive's first loyalty is to the leadership team rather than their own function, describes the third handover in plain language.

None of this is about the founder becoming less important. It is about the role changing, which we explore in from founder to CEO: from the person who makes the decisions to the person who designs how decisions get made.

A practical checklist

• List the twenty decisions you made last month and mark which should have been made by someone else under a written rule. That list is your first domain draft.
• Write each executive's decision rights with thresholds, and share the whole set with the team so everyone can see everyone else's.
• Define the enterprise agenda: no more than five company-level decisions the team owns collectively this year.
• Move consequential decisions out of one-to-ones and into the team meeting, and turn the updates into a written pre-read.
• Make peer challenge explicit: agree how executives raise concerns about each other's areas, and practise it on real priorities.
• Keep the team small and base membership on the enterprise agenda rather than the reporting line.
• Review the operating agreement every quarter for the first year, since the handovers rarely land on the first attempt.

Ask yourself

• Where were the three most important decisions of last quarter actually made, and who was in the room?
• Could each of our executives say, in writing, what they are allowed to decide without me?
• What does our leadership team own together that none of its members could deliver alone?
• When two executives disagree, is it resolved between them, in the team, or in my office?
• If our newest senior hire resigned tomorrow, what would their exit conversation say?

The takeaway

An executive team is not built by hiring senior people. It is built by handing them domains with written authority, a shared enterprise agenda they own together, and accountability to each other rather than only to you. Write down what you will stop deciding before the first hire arrives, and the team you hire will have something to lead from day one. High-performance teams at the top of a company start with that handover.