You cannot escape the responsibility of tomorrow by avoiding it today. ~Abraham Lincoln
When I was in college in the 60’s there was a popular saying: “What goes around comes around”. To me this saying seemed to be based on the notion of ‘karma’ and accountability. In essence, what you do (or don’t do) at one period of time, creates a cause and effect cycle which will at some point come back around as an “unintended consequence” of those earlier actions (or non-actions).
For example, let’s say that a manager discovers a problem in a business process that is owned by another department but which has a negative impact on the performance and profitability of the company. The manager, now aware of the problem, is professionally obligated to bring it to upper management’s attention in order to find a solution.
However, because the process resides in another department and that department head is known to be a tyrant and a bully, our manager hesitates, for fear of getting told to mind his own business, or worse. So he hesitates. Several days go by, then a week before he summons the courage to finally bring it up to the head of the department. Had he brought the issue up sooner they could have avoided a large customer defection which just happened. However, bringing it up earlier might also have caused bad blood between him and the other department since it was their process that was broken. Either action, now or later, has consequences and results in lasting impact on the individual and the company.
Leadership is not a position or a title, it’s an obligation.
The First Deadly Sin of Poor Leadership: Not Moving Quick Enough on Poor Performers:
“Get the right people on the bus, the wrong people off the bus, and the right people in the right seats.” ~Jim Collins
Most CEO’s coming into a company inherit their management team from the previous regime and one of the first obligations of leadership is to evaluate and where necessary upgrade team members, either through performance coaching or replacing them.
But how to evaluate and how quick to make a change? That is one of the key challenges facing any leader and, in my 35 years of experience, few do it well, or fast enough. There are a myriad of psychological profiles, business reviews and other tools that can help, but at the end of the day, a good CEO knows the type of person she wants in a leadership role. Here are some of the questions to use:
- Does this person inspire confidence and openness in their staff, or fear and mistrust?
- Is this person looking at the job and the company through a balanced set of objectives, or are they just concerned with costs and profits?
- Do their values and behavior match the values needed for this company?
- Are they coachable or stuck in their ways?
- Do they help and support their peers or do they talk negatively about them?
- Do they take accountability for mistakes or point the finger?
- Do they think of the customer first, or the company EBITDA first?
Yes, these are subjective, but so is the act of leadership. It’s not just numbers, its people and customers and culture as well.
In my experience, the number one sin of poor leadership is not moving fast enough on getting the wrong people off the bus! And leaders early in their leadership careers seem to be the most reluctant to get rid of inappropriate senior staff. And, the longer unsuited executives in leadership positions are tolerated, the more it hinders the organisation. Moving too slowly undermines the development of a new culture, negatively impacts the respect for the CEO (because, like it or not, everyone in the company knows who the poor performers are at the top), damages trust and morale, and negatively impacts overall business performance.
In one company the new CEO tolerated a very weak Head of Sales and Business Development for over 2 years, as company revenue declined by nearly 40% during that time period. Acting quicker would have allowed time for the right person to be found and to begin to make a positive contribution sooner. And the rest of the senior team would have gained greater respect and commitment to the new CEO, who was ultimately replaced after three years.ab
People are definitely a company’s greatest asset. It doesn’t make any difference whether the product is cars or cosmetics. A company is only as good as the people it keeps. Mary Kay Ash
A new CEO must be prepared with the following capabilities in order to build the best leadership team possible:
- An effective and simple way to evaluate the skills, capabilities and leadership style of each senior manager (and looking over a CV or resume is not the solution)
- An effective way to gain an understanding of the strengths and weaknesses of the current leadership team
- How well the senior team works together to solve business problems: do they work together or just deliver on their individual budgets and objectives?
- An insightful understanding of the overall company culture and its strengths and weaknesses and whether it can support the business and strategic objectives.
- The current level of trust and respect that employees have for senior management – are they inspired, demotivated or do employees just show up to earn a living?
Unless the new CEO can adequately gather the above information, it will be difficult to make the right choices as to who should be on the team and who needs to move on.
Are you prepared to make the people decisions that will drive your new company forward?
Written and Posted by: John R. Childress
Senior Executive Advisor on Leadership, Culture and Strategy Execution Issues,
Business Author and Advisor to CEOs
Visiting Professor, IE Business School, Madrid
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