Concerning the Going Concern

The chapter is about hiring, promoting, and managing executives — the people one level below the CEO whose individual performance largely determines whether the company functions. Horowitz argues that this is one of the most underdiscussed and highest-leverage activities in operating a company, and the conventional management literature offers thin guidance.

The chapter walks through Horowitz's framework for evaluating executive candidates. Skills matter, but skills can often be assessed in references; the harder evaluation is fit — whether the executive's specific approach matches the company's stage, culture, and immediate needs. An executive who succeeded brilliantly at a hundred-person company may not function at a thousand-person company; an executive whose strength is building from zero may not function at scaling-an-existing-business; an executive whose strength is operational efficiency may not function in a turnaround. The fit evaluation is harder than the skills evaluation and is more often wrong.

The chapter is also explicit about the difficulty of firing executives. Senior people have political weight, history with the team, and emotional connections that make their removal more destabilizing than removing a junior employee. But executives who are wrong for the current stage damage the company faster than junior employees do, and delaying their removal compounds the damage. The decision must be made on the data, and the data must be looked at honestly even when the personal cost of acting on it is high.

Horowitz's deeper point is that the CEO's job at scale is largely about making executive-level decisions correctly. The other decisions — products, customers, finances — flow through the executive team. Getting the executive team right means most other decisions get made well; getting it wrong means even careful CEO attention to other dimensions does not compensate. The chapter is a methodology for one of the highest-leverage areas of the CEO role.