First-time CEOs revealed huge challenges in taking on the role according to a new CEO study by The River Group. Here is a particularly telling finding:
On a scale of 1 to 10, walking into the company on your first day as CEO, how prepared did you feel you were to be the CEO?
Six months later, reflecting back to that first day, how prepared would you say you were, on the same 1 to 10 scale?
These results are based on in-depth conversations with 75 first-time CEOs on everything from preparedness to biggest surprises to the best and worst parts of the job. The results were not surprising to The River Group researchers or to me. I have focused my efforts over the last few years on the premise that most first-time CEOs are not ready for the role.
Based on the interviews – with chief executives on five continents with an average of 8,000 employees and $8 billion in revenue – here are 10 key takeaways and recommendations for first-time CEOs, which I agree with:
- Know from the start that you are not “the CEO.” Your job is to serve as CEO. Humility goes a long way.
The CEO role is not about power or being the smartest person in the room. It’s about channeling the experience and skills of others in the right ways and providing the proper resources.
- On day one your people will expect a message. Be prepared. Deliver. It will be your first impression to those who matter.
Owning the vision is one of the top five core responsibilities of the CEO.
- Recognize that you are no longer “you” in the eyes of others. Accept it. Manage it.
The CEO study highlights an interesting phenomenon here. As soon as you become CEO, people will begin to treat you differently. You will be seen as “complete” in the eyes of others; someone who has all the skills and answers. Don’t fall into this trap. The reality is much different.
- Engage your Board members individually. Develop a strong working relationship with your Chairman or Lead Director. Establish yourself as the CEO.
The CEO interviewees cited board management as one of their biggest surprises. One way chief executives can help is the CEO scorecard I recommend, giving each board member a way to objectively evaluate CEO performance and provide valuable feedback.
- Stay balanced. Your mental, emotional and physical health will be challenged by the job.
On a scale of 1 to 10, respondents judged their overall health prior to or after serving as CEO, on average, as an 8.2. During, the average dropped to 5.7, a decrease of 30 percent.
- Form or join a CEO forum. This should consist of no more than 10 to 15 CEOs with no one else in the room. It should be a confidential and “safe” environment to discuss issues of consequence and gain insight and advice.
“Lonely” was one word the researchers said came up frequently during the interviews with CEOs. Fellows CEOs will understand what you are going through and provide objective advice.
- Receiving constructive criticism and unvarnished feedback is very rare. But it is very necessary to the most powerful leader in the company.
The average score on a scale of 1 to 10 for quality of feedback the CEOs received was a 4.2. The score rose to 8.6 for those who had engaged a coach/trusted advisor, an increase of more than 100 percent. Also solicit objective feedback from subordinates. Consult “The 2R Manager” by Peter Friedes. Also, Dr. Tasha Eurich has an “Organizational Leadership Assessment” on her “Bankable Leadership” Web site that could be useful.
- You will not know what you do not know until you spend time in the role. Accelerate your learning and avoid pitfalls by engaging those who are, or have been, successful CEOs.
Be open to learning. Mentors and coaches will share expertise, knowledge, and impartial feedback that you might not receive on the job.
- A highly functional and aligned leadership “team” at the top is critical to success. The failure to address underperforming or corrosive individuals quickly and decisively is pointed to as one of the most critical mistakes made by new CEOs. As hard as it may be, the consensus is to take action swiftly.
As I wrote in Entrepreneur recently, the fastest path to mediocrity in a company is to allow poor performers to remain and pretend that it doesn’t matter.
- Engage. Engage. Engage. Be visible. Be approachable. From the bottom of the organization up—stay as connected as possible. Stay consistent. Communicate openly, honestly, broadly, transparently and at least three times more often than you think necessary.
“The myth of control” was a major finding, according to the authors of the CEO study. Those who believe a CEO is in complete control of the company don’t know much about being a CEO. In fact, lack of influence is a huge challenge for CEOs.
Engaging others, leading with a clear vision, and providing the proper resources are keys to having more influence. Another is to ensure that you are focusing on the strategic responsibilities of the job and not wasting time putting out the tactical fires of each day. In addition, having a management system is a way to ensure everyone is on the same page.
For more on how to tackle the role, for first-time CEOs or experienced ones, here are various ways to read or listen to my book “The CEO Tightrope.”
- Condensed eBook: http://www.khorus.com/the-ceo-tight-rope-abstract
- A free version of the audio book (with SoundCloud app): https://soundcloud.com/khorussoftware/the-ceo-tightrope-sections-1-4/s-DXoS3
- Audible version from Amazon ($2.99): http://www.amazon.com/CEO-Tightrope-Master-Balancing-Successful/dp/B0118AAR58/ref=tmm_aud_swatch_0?_encoding=UTF8&qid=1462311095&sr=8-1
- Hardcover via Amazon: http://www.amazon.com/The-CEO-Tightrope-Balancing-Successful/dp/1626341060
- Kindle version ($7.99): http://www.amazon.com/CEO-Tightrope-Master-Balancing-Successful/dp/1626341060