The authors of CEO Excellence: The Six Mindsets that Distinguish the Best Leaders from the Rest are all senior partners at McKinsey & Company, a global consulting firm. They have made themselves indispensable to the world’s largest corporations and have access to world-class CEO’s such as Mary Barra (General Motors) and Ajay Banga (Mastercard). Below are the three biggest takeaways I had from the book.
1. This is why networking is important
Marry Barra, CEO of General Motors, was quoted as saying, “Becoming CEO is unexpectedly lonely. I’ve always had a regular dialogue with whoever my leader was, and all of a sudden, you don’t have a leader to go to.”
This is a part of the job I would imagine most people don’t think about before becoming a CEO for the first time. Think about moving up in your career. As you gained more responsibility and authority, there were still people who had to approve your strategy or actions, or to whom you had to justify results. This essentially goes away once you’ve reached CEO. Yes, there is a Board, but those members are more for industry or leadership advice. None of them know your company the way you do, so none are in a place of authority to adamantly tell you a path is incorrect.
What can keep the top from feeling so lonely? Your network! This is where having built relationships with others in your organization and industry bears fruit. Believe it or not, the CEOs of “competing” organizations typically talk on a regular basis. They don’t give away trade secrets, but they discuss things that will affect the industry as a whole, such as economic and political factors. This helps give the CEO a sounding board for what they’re seeing, and keeps them from having to make decisions in a silo. You see this all the time with investment banking, the oil industry, and retail. Networking is important, and not just so you can see “500+ Connections” on your LinkedIn profile.
2. Think Again. Reframe It. Just make sure you are always tracking progress.
Adam Grant calls it “Thinking Again.” The books authors call it “reframing.” No matter what you call it, the lesson is that a CEO or business owner should always be assessing what is going right and what is going wrong in an organization. Is the company making progress on it’s goals? If not, what is holding things back? Research has shown that reframing the intent of the company helps employees better understand what is trying to be accomplished and how to get there. The book’s authors give 4 broad ways in which reframing can be done:
- Finding and amplifying intersections
- Making things about more than money
- Not being afraid to look back to look forward
- Involving a broad group of leaders in the process
My personal favorite is making things about more than money. The book gives several examples of the other points, but Under Armor provides a great example of focusing on the right things and then seeing the profits build as a result. As the former CEO _____ Hainer said “The goal wasn’t to be the biggest and the richest. It was to start creating products that help athletes perform better, so the runner can run faster, the tennis player and the soccer player can play better. If we did that and provided good service to our consumers, the financials would follow. All we had to do was help people achieve their personal best, and by doing so we’d also be making the world a better place. I wanted to give the company belief that this is more than just a revenue game and we are more than just a revenue company.”
It takes constant effort to make sure your organization is moving in the right direction, pursuing the correct goals, and that those goals are being measured appropriately.
3. High-performing teams are your secret sauce.
There are several factors that go into creating high-performing teams: organizational culture, hiring priorities, and management style all play a huge role. A great example in the book of creating culture is the difference between how people act at a concert recital versus a sporting event. If you’re at a music recital, you sit silently, rapt in concentration. At the end, you and the audience offer genteel applause. In the final moments of a sporting event—when it’s clear your team will win—you leap to your feet, yelling and waving and jumping up and down. You haven’t changed, but your environment has, and so has your mindset about how best to express your appreciation and enjoyment.
According to the authors, there are four primary influencers of an employee’s work environment:
- The stories that are told and the questions that are asked
- The formal mechanisms that govern how work gets done (structure, processes, systems)
- The role modeling employees observe
- The extent to which people have confidence in their ability to behave in a desired way
These items take constant assessment and reframing to get your environment right. While those items are being assessed, you can begin building a high-performing team by staffing with an eye towards aptitude and attitude, and by making sure teams only do work that they can do. Aptitude and a good attitude will trump experience and a bad attitude 99% of the time. Every hiring manager likes to see candidates with tons of experience in certain areas, but almost anything can be learned.
There is also something called the “Law of Triviality” that should be considered, and it ties directly to delegation. For example, an Executive Team meets and the team first discusses the investment for a $10M nuclear power plant. The decision was approved in two and a half minutes. Next was to decide which color to paint their bike shed ($350). The decision was made after 45 minutes. Next was to decide which new coffee machine to purchase for the staff ($21). The topic was discussed for an hour and a half and then tabled until the next meeting.
This story illustrates the “law of triviality,” where groups of people have a strong tendency to give disproportionate attention to trivial issues and details—in particular, those the entire group can relate to (and therefore have strong opinions about). Effective work is done when teams work only on things that aren’t deemed trivial. If it’s trivial to a group, it should be being addressed by a group of employees lower down the hierarchy.