Why CEOs leave
Depending on how much press we read, we can come across headlines that follow this pattern on a weakly basis:
XYZ has left his post after only x months due to differences of opinion on the strategy of the organization.
While we know that in most of the cases this is just a bullshit way to say that people didn’t keep promises, didn’t get along, new interests emerged that the new guy was crossing etc., sometimes this is really the reason why the new CEO leaves….and when this happens, it raises the following question:
How did the board decide exactly by this CEO?
Truth is in most cases the board doesn’t have a solid case for selection. Considering experiences, track records and chemistry is not enough; even ideas about strategy are not enough: how can the board decide if these ideas are good? Based on what?
The board MUST have a CONCEPT based on which a strategy maybe built before they start talking to candidates.
This concept should be discussed with the candidate who -if he’s good- can credibly add to it, modify it, etc. If the board hires the candidate, he’d present a strategy that complies with the concept and the board can approve it, or -if it’s a well functioning board- credibly add to it, modify it, etc.
In lack of this the typical schema goes something like this:
“can you increase profitability by 20% in the next 3 years?” “yes!” “how?”
“I see chances of reducing operational costs by introducing the following best practices and to increase revenues by cross selling, better marketing, expanding into new markets, etc.”
The schema is basically kept on the level of cliches which means communications is meaningless, which in turn means nobody knows anything.
Sure: in some industries it’s more difficult to come up with such a concept than in others. Being a 3rd tier supplier in automotive manufacturing SEEMINGLY leaves much less room for new/improved concepts that could serve as a base for strategy than in industries that cry out for new concepts, like media for example.
The common denominator across all industries is that only a handful of players have a concept, the rest operates on cliches….like the headlines they produce.
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Widening perception gap at RIM
Most perception gaps I’ve encountered exist between the C team and the staff. It’s much rarer when a perception gap develops between the whole organization and the market, which seems to be the case with RIM.
Sure: it happens often that the organization thinks it’s perceived very positively by its customers when in fact they score very low on various surveys that actually ask the customers…but in most of these cases the perception gap is still there between the c-team and the staff, since most of the staff, especially the customer facing ones are highly aware of customer problems.
RIM’s an iconic organization in Canada with a mutual dedication and loyalty between the employees and the company which probably ranks way higher than the industry average; this is just an assumption I developed from having numerous conversations with RIM employees and employees of other companies.
I think the employees want to believe in the future, in management, and this is what blinds them. Recent reshuffling of responsibilities in marketing and consequent departures talk about a different picture at the helm… maybe the co-CEOs want to remain blind leaving no room for marketing guys who should be and want to be responsible for closing the perception gap between the company and the markets.
This way an avalanche is developing starting with marketing spreading over all the way to operations (the COO is on medical leave right now).
Operations is focused on product development and launches for now (rather unsuccessfully we must add) but without marketing, operations will be less and less aligned to the “world out there”… and make no mistake about it: appealing as it may seem, you can’t align the world to your operations…not long term anyways!
Message to the investors:
DON’T DEMAND HEADS (YET), DEMAND A CONCEPT!
Message to Jim and Mike: FIND SOMEBODY WHO HELPS YOU DEVELOP A CONCEPT!
And now a side note which should not be taken too seriously; it’s a cheap shot that I did for my own morning entertainment:
I looked at departing VP digital marketing & media (he’s going to Samsumg), Brian Wallance on linkedin ( http://linkd.in/lbhY1F ):
11 years at RIM; started at the good times although I don’t know in what role or capacity. So he probably wasn’t brought in to his role to bring perspective or thinking (the two is closely related).
he was the “social” guy who is supposed to know what people want…if he’s leaving as a result of his own decision, he may know something;
looked at his tweets, though (http://twitter.com/#!/bdwallace): pretty polite and boring stuff, nothing that resembles an opinion or a concept of any kind. Here’s an interesting one though from April 18 : “”Blah blah blah Brian, blah blah blah Brian” – what I am hearing on this conf call…”
Clicked on his “blog” link, I got twitter again…
And finally: looked at his picture: he has the same glasses as all marketing guys I have met in the past 10 years 
. The guy knows how to pose though
Draw your conclusions.
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Authenticity
“Something can be rejected competently only by the one who is at the same time able to defend it perfectly. And something can be advocated competently only by the one who is able to reject it perfectly.” – Andras Laszlo.
Truth is that you don’t need to be authentic to be successful in business; business is overwhelmingly (say 90% ) a mechanical process where authenticity has no place: you buy what works for others, you implement what’s proven (by others), you run things the way you and everybody else learned to run things: you go by the numbers. In the mechanical 90% part nobody is (allowed to be!) authentic.
Then there is that 10% where authenticity makes all the difference. It’s not only about questioning the fundamentals and the conventional: it’s about giving answers to ultimate questions. Not finding! Giving. Creating: seemingly from nothing. Not relying only on the comfortable, lulling support of facts or evidence; having the courage to go all the way, and back: creating and representing the context for those who are busy with the 90% !
Without this effort nobody is authentic!
Without authenticity people in leadership roles are, unwittingly or otherwise, pretentious; they are forced to spend most of their time dealing with the resulting mess.
If you are in a CEO role and you want market leadership, you must dedicate more time to this 10% than to the 90%.
If you sit on a board of a company that’s striving for great things and you are not authentic, you are a liability!
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Corporate slaves
The pervasive view on leadership is situational (a better but uglier word would be positional), thus completely false.
The assumption is that guys in leadership roles “develop” or “grow”; they are reflective, analyzing mistakes and learn from it (some of them do, sure!). I guess some people (mostly 20 something consultants with fresh academic memory, who never have been in the driver seat themselves) even think that leaders spend a certain % of their time away from budgets, KPIs, pricing, conflicts, egos, and other mundane things in order to think about strategy, concepts and similar stuff. If they have good ideas that serve the common good, they can eloquently sell these to key people in their organization, to key suppliers and investors and together with them they happily continue their quest for world domination…
…of course; there must be a reason why made it to the top!
Most guys reporting to the CEO have a different opinion about this.
The problem is with the position. Positions are determined by conditions, much stronger than the CEO, whose activities are…highly conditioned; not the other way around, at least not in the overwhelming majority of the cases!!!
It’s important to note that this is especially true for so called “career leaders” who build their career by complying to conditions as much as humanly possible…or more.
The higher the role, the more restricted is the freedom to move. This is independent of market size since there is more competition in bigger markets while there aren’t enough positions available in smaller markets so in addition to market conditions, career leaders are also enslaved to their own ambitions. Make no mistake about it: these guys are going to serve their own (rather dull) ambitions, no matter what.
It’s obvious that such slaves cannot be trusted. This cowardice, which is often backed up by such sinister excuses like ” I am doing it for my family” results in enron, aig, goldman sachs on the higher end or mediocre machines, also run by well paid schizophrenics on the lower end.
It’s obvious (or it should be) that the essence of leadership lies in the ability to rise above conditions, which from another aspect is analogous with the will to real (as opposed to positional) power; it’s a poise that considers and evaluates conditions but aligns them to higher principles, very often against conditions and odds, creating new ones if necessary.
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Realigning google – 2 aspects of visionary leadership
Larry Page demands commitment.The media is now full of news of Jonathan Rosenberg and other key people leaving for family or other reasons, but this is not the point.
I consider it to be interesting and relevant here that Schmidt was a archetypal manager, while Page maybe the archetypal leader (vision driven).
Vision matters; more so than operations: operations must be adjusted to vision and not the other way around.
The role of leaders representing a vision is two-fold: to start (as Page indeed did) and to stop: stop initiatives or course of action that lead away from the vision.
Now google must be realigned and this demands leadership.
Demanding commitment is the best start for Page in his new role.
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Changing who you are…
Simple truths often get lost in the noise so it’s good to reinforce them once in a while .
It’s not about changing who you are but about becoming who you are. Changing who you are is impossible (A will never = B).
It’s about getting rid of who you are not!
Inevitably who you are not manifests itself in
- illusions &
- attachments
in various ways, nowadays perhaps more and more often in a sentimental fashion.
There are a couple of key things:
- rigor in constant self-observation and analysis
- an unshakable will not to compromise oneself for the sake of illusions and attachments
- strength to go against the current (of illusions)
- and a bunch of other things
All this with awareness which is the most important factor in the whole thing. This awareness does not need something to be aware of, it does not come from knowledge, but knows: himself.
…”wisdom is the ability to diffentiate”.
How to spot the winners
Some of us are looking for a challenge.
I have never been sure what this exactly means; chances are that it is just a figure of speech, meaning that I need to find another job, gig, investment opportunity, whatever.
Some of us just need to be there; the rest is details.
Examples:
VCs: the ones looking for a deal (challenge) are running processes; go through the motions, use the same criteria, getting referrals from the same people, asking the same questions, showing the same reactions, seemingly looking at the same deal, etc.
The ones who just need to be there know:
- we MUST do this play
- we MUST work with this guy / team / etc.
- we MUST be in this segment
Consultants or employees:
the ones looking for a challenge are fishing. Cast a wide net and see what they catch (their publication, their networking activities, their extra curricular activities serve this purpose).
the ones that need to be there are gravitated towards particular clients; the type of clients who also need to be there.
It is a question of identity. There is absolutely no stronger draw, no stronger certainty.
The people who need to be there, will create challenges.
There are more people looking for challenges.
I’d hire the ones who need to be there /here in a New York minute.\
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Style
Style is a critical element of identity, be it organizational or personal: the purpose manifests itself through style.
Since there is no perfect harmony between purpose and style, organizations are always in a state of identity crisis, to some degree.
Organizations without a clear purpose that goes beyond functions (like making profit) obviously act completely undifferentiated. But organizations with a very clear purpose may also be completely oblivious to how misaligned their style is (be it marketing, communications, branding, leadership etc.), failing to connect with the right minds in the first place and creating an absolutely wrong positioning in the minds of people in general.
A good example of such misalignment is the fund raising style of some non-profits who send people to the streets to talk to/harass everybody walking by. Begging as an analogy comes to mind immediately: does pitiful and calculated sentimentalism do justice to cancer patients?
The other side of the coin is too easy: style discloses a great deal about the purpose of the organization, or the lack thereof:
the process of calling the customer service of a telco for example almost always wastes time, communicates indifference (automation or the monotone voice of the reps who sound like machines), is set up to conceal information, etc. They create the impression that they are purposefully ill willed. The style speaks volumes about the purpose: we are here to rip you off. If no empirical evidence contradicts this, we are forced to think that this actually IS the purpose of the organization.
Only exceptional organizations are able to align themselves to the purpose and these are organized completely differently from the average ones. Examples: they define cost centres differently (call centres may belong to branding), their roles have different scopes of responsibilities (like chief operating and customer officer, chief strategy and people officer, chief hr and marketing officer, product and customer service manager, CEO and chief recruiting officer, etc., depending on the industry) and of course since more people are positioned where they should be and doing what they are born to do, these organizations are filled with creative tension that results in a high intensity energy that is palpable to everybody who interacts with them.
In short: differentiated organizations have a differentiated style.
Failed integration
The question of integration is a pressing one both in the business and political domains. Integration efforts predominantly fail. One of the core problems behind these efforts is confusing integration with unification. This is worth having a quick look at.
Unification means that everybody’s forced to become the same.
Attempts of unification inevitably result either in revolution or cynicism and sabotage, depending on the temperament of the people involved and the prevailing conditions. Why? Because the foundation of unification is a lie, which suggests that we are all the same.
Since A will never equal B, this effort can not succeed.
The style element of the unification process is manipulation. The agents of unification operate with lies, and much more dangerously: half-truths. Opposition to the process results in brutal suppression, eliminating those who question the validity of the system. Since tyranny is frowned upon, the unification process is always sugarcoated, which means that its agents are almost always schizophrenic, psychopathic (see http://bit.ly/9vhd6j ) or at the very least they suffer in an identity crisis.
Unification does not tolerate leadership while it generously rewards bureaucrats. People in systems of unification never become more than what they are; in fact leadership roles often serve as excuses to become even less (involution).
In polar opposition to unification stands the concept of integration.
The integration process starts with differentiation; differentiation is encouraged, respected and valued. A=A, B=B. A should be as much A as possible: pure, uncorrupted A. When A tries to be B, it is decline: weakness that is based on false views and ultimately on intellectual inferiority.
The result of integration is unity. Unity is an actualized concept; a true concept that is based on principles and not on an individual’s fantasy. Integration is inevitably hierarchical; the person higher in the hierarchy incorporates the principles that provide the foundation for the concept to a larger degree than the person lower on the hierarchy. The style of interaction between them is respectful. Respect is never geared towards another individual but towards the principles represented by them. Naturally there is nothing to respect in an individual that doesn’t represent / manifest any principles.
In an integrated system there is no individualism. The roles people fulfill are bigger than the individuals, thus they provide an “upward pull”, a chance to become more.
Mix-up
While some leaders recognize the need for differentiation, they continue building organizations whose purpose demand unification. Their messages about diversity are received with suspicion and cynicism; rightfully so. Visions, missions and strategies remain pure abstractions since they are merely individualistic concepts that lack any trace of principle.
While the need maybe there, leaders are not in a position to create the right conditions or influence existing conditions favorably for integration.
It should be obvious that integration is necessary and it calls for radical change.
How to handle challengers
This is how we do things here.
This is how we buy things here.
This is how we think around here.
This is what we want.
Then somebody comes and questions all this. Brings an element of surprise. Knocks out the fuse. Leaves people speechless. The tension is high.
It may happen that the guy who stood up is outrageously stupid…stupidity may cause this reaction. In this case the tension is toxic.
It may happen that all this is in context of a higher vantage point, a higher perspective. This may result in creative tension.
The problem is when the two gets confused. Stupidity is accepted as a vantage point, and perspective is considered to be stupid.
The unexpected always creates a moment of truth. A beginning.
A moment later it’s typically too late: it’s gone.