Business owners, founders, and CEOs often ask me the following question: “What is the difference between a CEO peer group and the Entrepreneurial Operating System® (EOS®) … and which is better for me and my company?” Here’s the scoop to help you make an informed decision.
Defining the Terms
A CEO peer group is made up of about a dozen CEOs from non-competing businesses of similar size. Participants meet to discuss ideas and issues, learn from experts, and hold one another accountable. In many groups, an experienced executive coach facilitates group meetings and is available for one-on-one coaching.
The Entrepreneurial Operating System® (EOS®) is an established and proven system that uses simple concepts and practical tools to help companies “clarify, simplify, and achieve their vision.” Six Key Components™ make up the core of the system: Vision, Data, Process, Traction, Issues, and People. EOS® Implementers (like myself) frequently assist businesses in learning and applying the methodology.
Looking at the Similarities
Both CEO peer groups and EOS are designed to help leaders grow healthy, successful businesses. Both options address similar pains, including:
- Getting the business “unstuck” when nothing seems to be working and forward momentum is stalled
- Finding better ways to handle matters such as resolving conflicts, making decisions, leveraging opportunities, or overcoming obstacles
- Addressing personal frustrations such as the sense that the business is controlling the leader rather than the leader controlling the business
Understanding the Approaches
One way to distinguish between CEO peer groups and EOS is in their approach:
- CEO peer groups focus on the leader and thereby help the business. The leader gains a network of experienced individuals with whom he or she can share ideas, frustrations, and questions, and consequently benefit from their input, advice, and coaching. The group becomes a safe and confidential place in which to pursue professional development. By helping the leader, participation in a CEO peer group contributes to business growth and development.
- EOS focuses on the business and thereby helps the leadership team. The leadership team is trained in implementing a well-defined system for running the business efficiently and effectively. In learning how to reliably create and achieve their vision for the company, set and execute strategic goals, etc., the entire leadership team (not just the owner, founder, or CEO) is equipped with a set of skills to further their professional development.
Weighing the ROI
In terms of meeting time, a CEO peer group typically meets once a month for a full day. Depending on where the meeting is held, participants may need to factor in travel time. EOS calls for six full-day meetings per year. Meetings are usually held on-premises.
Regarding investment cost, CEO peer groups can range from a few hundred dollars a month to upwards of $12K per year for a single membership. This cost is ongoing for as long as the leader desires to be a member of the group. EOS costs on average between $20,000 and $45,000 per year for two years. After two years, companies typically no longer need to use the services of an EOS® Implementer, but they may choose to do so for the benefits such facilitation provides.
When it comes to revenue growth, a 2023 study conducted for Chief Executive found that companies whose leaders were in peer networks experienced average revenue growth of just over 5% in 2022 compared to an industry average of only 1.62%. Gino Wickman, founder of EOS®, states that businesses that practice EOS® grow their revenue on average by 18% year on year.
Recognizing the Risks
Obviously, both CEO peer groups and EOS share a common risk: the risk associated with not actually doing what needs to be done. A CEO peer group can give the best advice, ideas, and input in the world, but if the leader does not take action, it is all for nought. The same goes for EOS: the system in practice is only as good as its execution.
CEO peer groups, however, pose two very specific risks that EOS does not share. The first is individuality. The value of a CEO peer group is directly dependent upon the individuals that make it up. A group with outstanding participants and a skilled facilitator is a fabulous place to be. Groups can also be solid but not great, or may even be just mediocre. Additionally, consider the ramifications if a great group loses one or more key members – the whole dynamic of the group could change for the worse.
In contrast, EOS is an objective system. It is designed to work with any leadership team, regardless of the individuals that make up that team. As long as the principles are followed and the tools are used, the leadership team will be able to realize their vision for the company.
The second risk has do do with sustainability. Only the leader of a company is directly involved in a CEO peer group. Consequently, if that leader retires or moves to another company or even just lets their membership drop, the connection to the group with all their collective knowledge and experience is severed. This can negatively impact the business.
EOS involves the entire leadership team and people at all levels of management in a system that is known and understood equally by everyone. Therefore, the loss of any one person does not represent a risk. The methodology acts as a foundation for the business. In fact, EOS helps prepare companies for inevitable changes in leadership, thereby ensuring continuity and growth.
Making the Decision
Which is right for you? It depends on your and your company’s needs and resources. Both CEO peer groups and EOS have the capacity to deliver tremendous benefits for leaders and businesses alike. I encourage you, in fact, to consider whether this may be a “both/and” decision rather than an “either/or” decision. Working in tandem, a CEO peer group and EOS are a powerful combination. I would be glad to help you explore further … feel free to contact me today!
