How Directors Get CEOs to See Blind Spots
Far too often CEOs miss out on valuable opportunities to receive direct feedback about their performance. Directors will have insights to share about how CEOs could have approached a problem or opportunity better, but simply fail to find the right time to share their thoughts. The desired recommendations then fail to see the light of day. The problem is that when left unattended to, these issues can often morph into full-size strategic problems for the business and all their stakeholders. We’ve seen examples like John Scully losing focus at Apple and spending too much time in politics and too little time managing and Boeing’s Harry Stonecipher extramarital affair as examples of how a board’s inadequate feedback on a CEO’s burgeoning weaknesses can lead to both a flame out for the CEO and the stock price.
To be sure, getting the CEO to openly receive the board’s criticism is no easy task. It takes effort and humility to invite constructive criticism from those that one serves. However, I find two approaches can be particularly effective in getting CEOs to warm up to professional criticism and boards to gain more confidence in their CEO oversight duties.
Blind Spot Sessions
The first approach involves the CEO inviting direct reports, board members and other key players into one-on-one sessions whereby the CEO asks for feedback around their blind spots. The CEO must promise that they will not retort or respond to the listing of opportunities of growth. Instead the CEO must patiently listen take notes, and only ask questions for clarification in a calm and unemotional manner.
This is a very difficult approach to getting feedback, but on occasion I have seen it work successfully. The keys are trust, patience, a lack of negative emotions and high self-esteem in all those involved. I don’t often recommend this approach because it is rarely implemented. The main drawback is that most CEO’s intimidate those who need to give the feedback; people just don’t feel safe in opening up. The people who have the insight are in fear of reprisal or of a negative impact on the relationship. Most CEO’s don’t know how to effectively encourage others to fully open up with constructive criticism. Too often only an outsider, fearless of reprisal or loss, can break through. One CEO of a commercial real estate firm had over two dozen team member spend over an hour each share blind spots. He was in tears each night over what he was hearing, but as a result the team bonded so tightly that they became first in their market in short order.
CEO 360
Another approach is for the board to retain an internal or outside party to conduct private one-on-one interviews with the same individuals listed above. This approach allows for more thorough dialogue, more experienced questioning and an amalgamation of the findings being distilled into recommendations steeped in experience.
I find these sessions give directors an opportunity to discuss issues related to the CEO that they would never tell him or her in person. I’ve even been told in CEO 360s that, “The CEO’s breath stinks”, “he drools” or more importantly “his cussing habit chases away good people.” Issues difficult to bring up one on one let alone in a group.
Directors commissioning CEO 360s should hear from the chairman, other directors, c-level executives, direct reports and even some customers if they are relevant. The review should focus on key areas such as: What does the CEO do best? What do they most need to improve upon? What areas should this process focus on first?
I have asked the CEO about who they believe is giving them the most support and with whom do they believe they need to improve alignment. There are many areas around the politics and alignment of a team that the CEO knows need work. However, they don’t consciously work upon until they’ve spoken the thoughts out and created a plan. I simply ask them who they think will most weaken or strengthen them and their objectives and how. I also ask who and what are their primary allies and obstacles.
Of the most common improvement areas identified in a CEO, it amazes me the significance of impact that these improvements eventually have on the organization. Just look what happened when Steve Jobs improved upon his blind spots during his hiatus. Intuit Chairman and Apple board member Steve Campbell coached Jobs on many things but it is surmised that perhaps the most important may have been on how Steve could ameliorate some of his management and communication foibles. This had to have some part in creating nearly a trillion dollars of value. At one client company the CEO gets candid feedback on his performance and style from employees at every level in monthly roundtables. Many point to this as a key to turning around the culture.
Of the hundreds of CEO’s I’ve met and worked with closely, all but a few have wanted to continuously improve upon themselves. While these are delicate conversations around areas that may never be discussed outside the one-on-one relationship, most all CEO’s are willing to listen to the constructive criticism and build plans around which they are willing to be held accountable.
If you think your CEO could benefit from these exercises, consider a plan for positioning this as an approach that benefits not only the CEO as an individual performer, but the relationships of all those around them. And within that context, it should be viewed as a boon to the organization as a whole, as well as shareholders.
