A few years ago, I remember reading a glowing interview with the CEO of a large Australian firm about the organisation’s sharemarket success and his new strategic plan. Everywhere you turned there was a business magazine promoting the words of the CEO and his ambitious Asian Pacific focused strategy, while he mocked other Australian companies for not following suit.
Then, a couple of years later, he was out of the top job and his successor was interviewed in all the glossy business magazines deriding the previous strategy and why it was doomed to fail. Of course, his more thoughtful, less grandiose and rational strategy would turn around the faltering organisation.
I’m sure many of you are thinking that this story is not unusual. Many magazines are filled with superficial strategy promotions by eager and charming CEOs. Journalists inadvertently fall for media-savvy CEOs and fail to uncover the real truth because any interviews with other executives are sanitised so as not to bad-mouth the CEO (and become a career-limiting move). But once the strategy has failed, and people have moved on to new careers, you can dig underneath the spin to find out what really happened.
Recently, I sat down with one of the company executives involved with the original Asian-Pacific expansion strategy who had been shocked that none of her fellow team members had agreed with the CEO on it, yet no concerns had ever been raised in any of the executive team meetings. She said:
“It wasn’t until I left that I realised I was the only person in the management team that believed in it. I was naive. There was no one around that table who were honest. You’re honest if you feel like you’re safe. The CEO was banging his drum about it, I was running around trying to execute the strategy and getting crucified by my colleagues, who didn’t want it or believe in it. But we didn’t have any of those open and honest conversations about it. No one trusted that they could speak up and say “Mr CEO, we don’t believe in your strategy.” His predecessor would complain about it to me, and I would say “Have that conversation with Mr CEO.”
Again, you’re probably thinking that’s not unusual and that corporate executive teams are known for their inability to collaborate and act as glorified ‘yes’ men and women to the CEO. And you would be right.
Humans are designed to avoid conflict. Leaders fear speaking up about issues in case it makes them look stupid or unpopular. This is particularly the case when you have an egocentric, swash-buckling CEO used to having their own way. Having the courage to be vulnerable in a high stakes situation takes a lot of guts. It’s a common global problem that not only occurs within the top team but throughout all levels of an organisation.
Keeping Opinions to Yourself
A study from Heidrick & Struggles found that between 20-50% of the world’s top corporate teams have strife and tension as the norm. The most common reason is that there is a lack of agreement over the nature of the strategy being pursued, followed by how to implement the strategy.
But let’s be clear about one thing. There is nothing wrong with a bit of strife and tension in a team. Healthy debate is what is needed to reduce the tendency towards groupthink and to really flesh out the feasibility of strategic initiatives. It’s a good thing. Without robust discussion, you get mediocre ideas and a lack of commitment. As Joseph Joubert said:
“It is better to debate a decision without settling it than settling a decision without debating it.”
Strife and tension are only an issue if personal insults are being hurled or it’s all silent with people being too afraid to openly talk about it. The result is sabotage behind the scenes and a lack of action.
The inability to raise uncomfortable issues is a worldwide issue among some of the largest companies on the planet. In France, 36% of top teams feel unable to raise issues, while in China it’s a high 80%. Similarly, the research found that CEOs and even the Chairman are rarely challenged both in the United States and United Kingdom. While no Australian figures have been listed, it’s pretty reasonable to surmise that we are not much different given that Australians are almost genetically resistant to following and trusting leaders (just take a look at our politicians who can’t even support each other).
In today’s pressure cooker business world, leading in a world of rapid change and complexity demands faster strategic adaptation and execution to ensure continued business success. But getting an alignment of thinking around the strategic plan is where many organisations – both big and small – get stuck.
It shows up as:
- Executive teams, work teams and divisions not collaborating – decisions are slow, politics, turf wars and self-interest become evident. Decisions get made around the water cooler and issues that have presumably been settled keep being reopened.
- Executives or employees pay lip service to initiatives and fail to commit to them because they don’t understand them or believe in them.
- Middle managers have difficulty communicating an engaging vision because they don’t feel any passion from their group leader about the strategy. Even when the senior leader does support the strategy, if the middle manager doesn’t understand it or believe it they will be poor at communicating the benefits to other employees.
- Employees at all levels aren’t comfortable raising concerns or discussing potential opportunities.
Alignment of Thinking Creates Engagement
As Hugh MacKay says in The Art of Belonging, humans are designed to work with others. We need to maintain the connection to the tribe that sustains us, but at the same time, we are also selfish and competitively driven by the need for personal survival. In a work environment, we are constantly caught in the crossfire between two conflicting sides of our evolutionary heritage.
The bigger an organisation becomes the more likely it is to fracture into fiefdoms and turf wars. The balance between working with others and our competitive natures plays out when departments operate in silos.
An important challenge for leaders is to create a strong, shared culture where people are unified, to avoid a political and potentially adverse environment. CEOs need to create a secure environment where the executive team feels safe to be themselves, to speak up and express their views, while also feeling an emotional safety net that they belong to the team and they are valued for who they are. It’s about enabling people to bring their whole, authentic selves to the table, with all their wisdom and know-how. This helps a group of people work together to debate and solve issues, rather than self-interest and false consensus reduce true collaboration. It’s in a candid environment that you can create alignment in thinking which is just as important as alignment in structures throughout the organisation.
Alignment is closely linked to engagement. Once the value proposition has been outlined and presented to the leadership group, the CEO’s ability to listen to their feedback and co-create a proposition that everyone is comfortable with is the best way to get engagement. People will only engage with a strategy if they feel that their opinion has been heard (even if they disagree with it). Without this, executives pull in different directions creating a misaligned organisation. It’s only a matter of time before the strategy falls apart, costing the organisation millions and a severely reduced share price. Typically, the CEO walks away with a handsome redundancy.
Today, complex business problems depend on a lot of engaged minds working together to devise a solution. Being nimble and adaptive is a business requirement for success, but it will never occur in an organisation where people are afraid to speak up. Addressing painful truths is the way to growth. After all, if you don’t get the unpleasant stuff out of the way, you can waste a lot of time.
Moving to Strategic Success
Leaders who can provide safe, trusting environments where people are free to be themselves, can challenge leaders (including the CEO), raise concerns and debate issues, create an environment where innovation and collaboration can thrive. This can only occur when leaders trust their people and in return, employees trust them. In a high-trust culture, people give their leaders the benefit of doubt enabling the leader to course correct and move the company forward. But in a low-trust culture, mistakes and problems provide evidence that the plan isn’t working. People refuse to commit to it and take action.
For leaders to navigate change more effectively,it takes is a strong and humble leadership team willing to listen to others to harness the collective intelligence of the organisation.