Effective Enterprise Leadership: Counsel for enterprise leaders from enterprise leaders — CHAPTER 7
Reflections on the Essentials
Proof for the essentials
“How do these practices correlate to performance?” A former CEO, who graciously agreed to review a draft of this book, asked the vital question — do these so-called “essentials” work?
A comparison of points emphasized by the executives interviewed with the relevant periods of stock price performance from their firms reveals… nothing. So many factors affect share price that such an analysis is almost certain to prove inconclusive. A deeper dive into the alpha portion of stock performance (at least for the public companies among the enterprises represented) might reveal more; however, that deeper dive would have to be based on what the executives had done, not what they had learned from both their successes and mistakes. The insights and counsel offered in this book are based on hard-earned experience, not a randomized control trial of the prescribed actions. In other words, the vital question can’t be answered empirically.
While contributor’s insights are presented almost entirely in the positive frame, a failure story exists, either in the public forum or amongst the contributors, for every idea offered in this book. A few examples are well-publicized and included, such as Arthur Andersen’s reliance on culture to protect its firm or Xerox’s failure to manage investor expectations when it embarked on a transformational strategy. Some quotes refer to closely-held vignettes from executives who have had the job, made the mistakes, and learned the lessons.
What about talent? Growth? Productivity?
Another collaborator asked why there wasn’t a section of the essentials dedicated to attracting, developing, and retaining talent. The same question could be asked about growth, productivity, and a number of other topics. These themes are frequently elements of the enterprise leader’s agenda. Improving talent, growth, and productivity are universally appealing objectives. Determining priorities, the path to achieve them, and their connection to enterprise culture are drivers for the essentials.
Applying the essentials
“Everything should be made as simple as possible, but not simpler.”
Albert Einstein
Does this summary of enterprise leadership essentials pass Einstein’s maxim? As offered in this book, the essentials include four areas for action, categorized into 15 themes, detailed through 69 specific ideas. The role of enterprise leader presents an inherently complex problem; as such, it is not surprising that a synthesis of the insights from several successful executives covers a wide range of topics.
The most experienced leaders interviewed tended to express the need for balance across the essentials. Several executives mentioned the risk of “doing what you like,” rather than doing what is needed. Others commented on the temptation to revert to familiar actions when under pressure. The enterprise leader is accountable for all aspects of the enterprise’s performance and health and must ensure that all the essentials are addressed. The sequencing and emphasis of actions and the allocation of the leader’s time will be informed by the needs of their situation.
Leaders’ self-assessments
Enterprise leaders do not see themselves as uniformly strong across the essentials; in fact, many volunteered critical self-assessments while sharing their perspectives. Others commented that they were aware of necessary changes on which they had not yet acted.
Contributors gave themselves the lowest marks on “Manage for performance,” particularly in the areas of clarifying decision rights and responsibilities; making collective decision-making work; and, building a constructive crucible for problem-solving. While many contributors felt that they were strong on the “Unify through culture” essentials, they did not feel that their beliefs and actions on dealing with the “star problem” were as tightly aligned as they could be. As mentioned in the introduction to “Know your role,” several contributors reflected on mistakes early in their tenure that stemmed from assumptions, misinterpretation, or blind spots on the specifics of their mandate.
Journey or discipline?
The leader’s agenda should evolve over their tenure in the role. Like the “S curve” used to describe the spread of innovations, the early months of new top executives often feature situation assessment and agenda development. As their actions bear fruit, leaders often shift their emphasis toward execution, refinement, and replication. Declining rates of improvement and progress mark the maturation of the leaders’ efforts and signal the need for renewal — of either the agenda or the leader.
After successfully executing an agenda, enterprise leaders may find themselves trapped by their own success. As one leader asked, “I know that the world is changing. Is my view of it still valid?” Another contributor believed that “disrupting yourself” is one of the hardest tests for a leader. “It takes extreme self-confidence to challenge how your business works — after all, you are the one who set it up that way!” Leaders who find themselves mired in their own pasts have two options: pass the baton to a successor or refresh themselves and the team around them.
“A new broom sweeps clean…”
Change at the top of the enterprise can help reset relationships between senior executives, attract new talent, and energize investors. It can provide the enterprise with a fresh perspective on what is possible and infuse new energy to attain it.
“…but an old broom knows the corners.”
Successful enterprise leaders may be able to refresh their perspective and create successive “S curves” of their own. Doing so usually requires changing senior executives and key employees. It may also require changing the leaders’ direct reports, primary work location, or role in decision-making processes. Whether they step aside for a new leader or find new leadership within themselves, effective leaders put their stakeholders’ interests first and ensure that the enterprise and agenda are the best they can be for the challenge ahead.
In closing
I hope that this book gives fair testimony to the wisdom of those who gave their time to make it possible. To all of them, thank you.
If you are holding a copy, you have either contributed to its creation or have been recommended to receive it by one of its co-creators. You are part of an exclusive group — people who have earned the opportunity to tackle some of the world’s most demanding leadership roles. May it provide some signposts for your journey.
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Revisit Chapter 6.
