What is a principal?
I constantly get asked by readers and clients if I can send them a job description for Principal. My response is usually the same – there is no job description for this title. “Principal” is a status title. Most of the time it is synonymous with “owner” but not always. Our own research tells us that in 5 to 10 percent of the cases, those with this title are not owners. They could be working for publicly-traded firms or captive firms of other companies but are still deemed critical to their clients and company and therefore have the title.
For most companies in this business, however, “principal” does equate to both status and ownership. It’s an important title and an even more important position in firms. Those who are called “principal” should be cognizant of several important aspects of their roles. Here are a few of them.
- You serve as an example. This cannot be stressed enough. Everyone will be watching you and emulate your good – and bad – behaviors. That means people will pay attention to when you come in and when you leave, where you choose to eat out when you’re on the company nickel, how diligent you are about filling out your timesheet and expense reports, and a million other things. The mantra is, “Do as I do and not as I say.”
- You have to keep the big picture in mind. That means stop thinking like you are an MEP department head or a branch office manager and start thinking like someone who is an owner in a company. That means you aren’t the union shop steward nor representative of some group inside the firm that has an inferiority complex. You are a FIRM leader!
- You are probably expected to bring in work. Most people don’t get this title unless the others in charge think they can sell new work. There are a few exceptions – principal CFOs or perhaps a “Grand Wazu” of some technical or design specialty. But mostly, principals are those who are doing the selling. As such, you better be selling.
- You will be the one to make sacrifices if they have to be made. If it all gets ugly and the firm starts losing money and has to make adjustments beyond cutting the obvious dead wood from the ranks – the next place is principal pay. Get ready to cut it if necessary to keep the firm on a sound financial footing. It will probably be necessary at some point, even if only perks and not base pay.
- You have to groom your successor. The name of the game is continuity. It is also about being able to move up into a higher level role. So that means a big part of your responsibility to the enterprise is to find who will replace you when you move on or move up. It’s a real simple idea but about half or more of the principals I have observed over 36 years in this industry don’t do it.
- You have to be a decent person to everyone in the firm. This means you can’t berate people publicly, lord your title over them, or in general be a jerk. It also means you need to treat everyone in the firm as if they are important and worthy, not just your fellow principals or “partners” as some principals insist on calling themselves (I don’t like that term for a variety of reasons!)
So there’s a lot to this “principal” moniker. Do your principals share a common understanding of what the title should mean in your firm?
Mark Zweig is Zweig Group’s founder and Chairman. Contact him at email@example.com.
This article is from issue 1176 of The Zweig Letter. Interested in more management advice every week from Mark Zweig, the Zweig Group team, and a talented list of other guest writers? Click here to subscribe or get a free trial of The Zweig Letter.
More resources for Principals
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