5 hot tips for Boards when recruiting & managing their CEOs
There are some stunning CEOs out there that are beloved by their employees, highly respected by their Boards and are truly inspiring leaders to the community at large. Regrettably though, there are also some CEOs out there that significantly let the side down. It is well understood by many senior executives and employees the impact that a poor CEO can have on workplace culture and the impact that the resulting culture can have on retention of the best and brightest, overall productivity and core purpose innovation.
With the unfortunate examples of bad CEOs out there, the front of mind question becomes: How can governing Boards ensure that they are doing enough to safeguard rigorous due diligence in a key accountability that Boards hold – the recruitment and management of the CEO position?
Here are 5 hot tips for governing Board members to consider when it comes to the recruitment and performance of your CEO:
1) Here is your non-negotiable baseline - an exceptional level of Emotional Intelligence
It goes without saying that your CEO needs a high level of abstract reasoning - the ability to connect the dots quickly. However, to be really successful in leading across all organisational fronts and aspects your CEO also needs an above average level of emotional intelligence that will allow for sound leadership capability, problem solving and decision making. If your Board does not understand well enough the concept of Emotional Intelligence and the significant benefits of putting weight on it in the CEO recruitment process, then make it a priority to find out more.
2) Ensure your CEO or CEO candidates have a proven track record of not only designing business strategy but also taking accountability for strategy execution in a disciplined and focussed manner
Many CEOs have a strong aptitude for strategic thought processes which serves them well when brainstorming and designing core ideology and strategy for an organisation. Unfortunately, when it then comes to deploying the strategy there are some personalities out there that are more interested in continuing to strategize on an on-going basis rather than focus on the daily reality of strategy execution. This can cause massive confusion, frustration and obviously lack of direction across the organisation, wreaking havoc particularly at the senior executive level where significant attempts are being made to provide clear direction on a day-to-day basis to functional areas. As a Board, be thorough in your background check on the reputation the CEO candidate has not just for strategy design but also for successful strategy execution.
3) Ensure your CEO candidate knows how to put a senior team together with both the technical skill set and leadership personas that will take the whole organisation on the voyage ahead
Your CEO will only be as successful as the senior leadership team surrounding and supporting them so a significant success factor to any CEO is their ability to surround themselves with a team that are capable leaders and technically competent. Sometimes, this unfortunately means that after a period of duty of care, difficult decisions will need to be made. You need to make sure that your successful CEO candidate has the courage, skillset and experience to make and implement the tough calls.
4) Become exceptionally well versed in your understanding of the ‘Dark Triad’ personalities that unfortunately do sometimes make it to the top – know how to spot them, avoid them and if it’s too late, how to exit them
At the CEO level, the ‘Dark Triad’ personalities i.e. the extreme Narcissist, the Machiavellian, and the workplace Psychopath all tend to have one thing in common, they are exceptionally skilled manipulators (many with a high level of charisma) who know their way around an interview process. Make sure you have someone as part of your interview panel that knows how to dig deep and see what’s going on personality wise. Again, as a Board be thorough in your CEO candidate background and reputation check - it is not just about the number of apparent business successes they claim in the interview, it is about how the apparent successes were achieved.
If however, one of these three personalities make it through the interview process and you start to see, hear and feel the damage, you need to act quickly as these personalities can leave behind them significant destruction that is widespread and takes an inordinate amount of skill and time to fix.
5) When a Board first recruits a CEO, the monitoring of the new CEO’s leadership performance in the first year of tenure is critical - I cannot reiterate this enough
For those of us in the business of culture development, organisation development, etc., we know and can cite many (too many!) examples of businesses where a new CEO has completely decimated a strong culture within months of starting with the organisation. Yes, it is sometimes important that a new CEO needs to ‘stop the bleeding’ so to speak, particularly if the organisation is in major financial strife. But there are smart ways to do this that will not result in a mass exodus of the very talent that might need to play a significant part in the refocus and change that can be required to turn the ship. If your CEO candidate appears to be a change agent, make sure you understand that they are an experienced, emotionally intelligent change agent that knows how to stop the bleeding without ripping the business apart, resulting in a situation that can then take sometimes years to heal.
In summary, it is clear that for any Board a crucial governance accountability is the recruitment and management of the CEO position. Hopefully, these five tips will help you as a Board to achieve your governance role in recruiting and managing a great CEO. A CEO that inspires, motivates and unleashes full potential for your organisation as opposed to an alternate reality where you could end up with costly incompetence in the top position. An alternate reality that maybe includes inadvertently letting loose on unsuspecting employees, a recidivist bully or unchecked political monster that might just systematically and remorselessly destroy your organisation.