Optimism is the lifeblood of business. Without it, there is no risk-taking, no innovation. But optimism can also create blind spots, including on the C-suite leadership team: Just because you bring together a group of high-performing executives and call them a team doesn’t mean they necessarily are going to act like a team. And because most of management’s presentations to the board are often as carefully choreographed as any Broadway production, the effectiveness of the C-suite as a team is often an under-appreciated risk factor for executing the strategy.
This is not to say that C-suite leaders don’t have good intentions. If you ask individual executives what they really want from each other, the most common response is usually, “We want to have each other’s back.” That sense of goodwill, however, often evaporates when they get into their regular meetings and compete for resources, recognition and responsibility.
“At some point in their lives, most leaders have been in some environment—whether it was sports, the military, a fraternity or sorority—where they’ve had each other’s back,” said Harry Feuerstein, President of Merryck & Co. and former top executive at Siemens. “But they go to work and that all goes right out the door.”
Why the disconnect? Why do so many executive teams fall short of the goals that they set for themselves—to be a high-performing and collaborative group, built on a foundation of trust? We have seen three common themes that hold C-suite leadership teams back from reaching their potential.
Although a clear strategy would seem to be table stakes for any business, we often find that executives at the same company describe their strategy very differently. Sometimes the dissonance is caused by a lack of communication from the CEO—the strategy may be crystal clear to her, but she hasn’t broadcast it widely or often enough to stick across the organization.
The lack of alignment can also be caused by different interpretations of the word “strategy.” For some, it’s the lofty aspirations of the company. For others, it can be a kind of broad technical or market direction that lacks any real specifics. For still others, it is the list of annual priorities or initiatives.
But generally missing is a layer that we like to call a “simple plan”—a concise statement of where the company is headed and why, with milestones for measuring progress and a clear sense of what winning looks like. That may sound easy, but many leaders struggle with this question when they are pressed on the details.
“If you ask CEOs, ‘What’s important?’ a lot of them will give you 21 single-spaced pages of their priorities, and that’s not going to work,” said Greg Brenneman, Executive Chairman of CCMP Capital and a board member at Baker Hughes and Home Depot. “What is your one-page plan?” Once that simple plan is clear, the leadership team discussion becomes much easier. What is the team’s role and opportunity to help drive that strategy as a team? Why are we a team? What can we only accomplish together as a team? How are we going to truly prioritize what we are going to tackle, rather than just ranking a laundry list? What will progress look like?
Even though they may have been part of some kind of team when they were younger, most senior executives spend long stretches of their careers leading their own teams. So when they join a leadership team and are no longer at the head of the table, collaborating with their peers requires a different and often underdeveloped muscle.
On a team of Type-A personalities, it is the leader’s responsibility to set the expectation and demonstrate the “how” for the team to work together to tackle strategic challenges. Without that clear signal, C-suite meetings easily can default to an agenda of serial one-on-one conversations with the CEO. These are overwhelmingly tactical in nature rather than strategic.
If directors want to determine which dynamic is at work in their company, they can learn a lot with subtle probing, using questions such as: What does the leadership team see as the organization’s top five priorities? Who owns solving for each, and what collective markers of accountability has the team aligned around?
When senior executives join a leadership team and are no longer at the head of the table, collaborating with their peers requires a different and often underdeveloped muscle.
Every C-suite needs an explicit discussion about how the group is going to work together. How do you make sure that everybody contributes, rather than letting just a couple of voices dominate the discussion? How will decisions be made, and based on what context? How do you set a tone that enables candid but respectful challenges?
Some leaders set firm guidelines up front. Kevin Sharer, former CEO of Amgen and now a Merryck mentor, shared the clear signal he sent to his leadership team: “I remember when the new team was assembled, having a dinner and saying to them: ‘We’re new, we’re together, we all feel lucky to be here, but let me tell you something. I’ve operated in environments where there were master politicians. I’m not a bad politician myself. So I can see it. If any of you try to be politicians, I will know it, and I will fire you.’ We laugh about that now as a table-setting meeting—I think it stuck.”
That might strike many as too blunt, but the greatest risk lies in not having the conversation. When each executive plays by his or her own rules, frustration, misunderstandings and slow progress can plague execution.
The board plays a key role, as well, in setting the tone. Ken Freeman, the former CEO of Quest Diagnostics and Dean of the Questrom School of Business, believes that directors have an obligation to model the behaviors in the boardroom that they want management to follow. “If they see us eating nails for breakfast, then they’re going to think they should eat nails for breakfast,” he said.
There is no single template or blueprint here. The point is for the CEO to simply ask his team: How are we going to work together? And the board, in its strategic capacity, can also inquire if the CEO has held this discussion yet.
When boards and CEOs address these three common challenges for the C-suite, they notice an immediate lift in the collective productivity of management. Meetings are more efficient and are more likely to result in action rather than just activity. The key, as with most challenges of leadership, is to be intentional about linking the team’s purpose to the overarching company goals. It is the challenge that Satya Nadella told me that he set for himself when he took over as CEO of Microsoft in 2014.
“The thing I was most focused on early on was, how am I maximizing the effectiveness of the leadership team, and what am I doing to nurture it?” Nadella said in my interview with him at the time. “Are we able to authentically communicate, and are we able to build on each person’s capabilities to the benefit of our organization?”
Adam Bryant is Managing Director of Merryck & Co., a senior leadership development and executive mentoring firm.