The Five Temptations of a CEO [Book Summary]

The Five Temptations of a CEO [Book Summary]


Temptation #1:  Choosing status over results

The most important principle that an executive must embrace is a desire to produce results.  Yet some CEOs put the desire to protect the status of their careers ahead of results in their list of priorities.  They make decisions that protect their ego or reputation or, worse yet, avoid making decisions that might damage them.  They reward people who contribute to their ego, instead of those who contribute to the results of the company.

Simple advice for CEOs:  make results the most important measure of personal success.

Self assessment:

  • Do you often wonder, "What's next?  What will I do to top this in my career?"

  • Would it bother you greatly if your company exceeded its objectives but you remained somewhat anonymous relative to your peers in the industry?

Temptation #2: Choosing popularity over accountability

Wanting to be well liked by your peers is an understandable, but dangerous, problem for CEOs.  CEOs spend considerable time with their direct reports, who are often the same age.  Most CEOs become friends with their reports and commiserate about the constant needs and shortfalls of employees.  They develop a sense of camaraderie.  It is no surprise that when it comes time for a CEO to tell these direct reports that they are not meeting expectations, they balk.

Empirical evidence of this phenomenon is that CEOs conduct performance reviews for their direct reports far less diligently than do managers at other levels.

Simple advice for CEOs:  work for the long-term respect of your direct reports, not for their affection.  Don't view them as a support group, but as key employees who must deliver on their commitments.  And remember, your people aren't going to like you anyway if they ultimately fail.

Self assessment:

  • Do you consider yourself to be a close friend of your direct reports?

  • Does it bother you to the point of distraction if they are unhappy with you?

  • Do you often find yourself reluctant to give negative feedback to your direct reports?

  • Do you often vent to them about issues in the organisation?  For example, do you refer to your direct reports as "we" and other employees as "they"?

Temptation #3: Choosing certainty over clarity

Many CEOs want to ensure that their decisions are correct.  Hence, they postpone decisions and fail to make their peoples' deliverables clear.  For example, a CEO may not have certainty over how the company should conduct its marketing plan, and he may consequently not make it clear what he expects from his head of marketing.  Such a CEO provides vague and hesitant direction to his direct reports and hopes that they will figure out the right answers along the way.

Simple advice for CEOs:  In a world of imperfect information, make clarity more important than accuracy.  If the decisions you make in the spirit of creating clarity turn out to be wrong when more information becomes available, change plans and explain why.  It is your job to risk being wrong.  The only real cost to you of being wrong is loss of pride.  The cost to your company of not taking the risk of being wrong is paralysis.

Self assessment:

  • Do you pride yourself on being intellectually precise?

  • Do you prefer to wait for more information rather than make a decision without all the facts?

  • Do you enjoy debating details with your direct reports during meetings?

Temptation #4: Choosing harmony over conflict

Many CEOs believe that it is better for people to agree and get along than disagree and conflict with one another.  However, sometimes harmony restricts "productive ideological conflict", the passionate exchange of opinions around an issue.  As a result, they don't benefit from the best sources of information that are always available to them: their direct reports.  Without this kind of conflict, decisions are often sub-optimal.

Simple advice for CEOs:  tolerate discord.  Tumultuous meetings are often a sign of progress.

Self assessment:

  • Do you prefer meetings to be pleasant and enjoyable?

  • Are your meetings often boring?

  • Do you get uncomfortable at meetings if your direct reports argue?

Temptation #5: Choosing invulnerability over trust

CEOs are relatively powerful people.  Being vulnerable with their peers and reports is not a comfortable prospect.  CEOs who give in to a desire for invulnerability will never succeed in generating productive conflict, because it doesn't feel safe to their people.  As a result, those reports position themselves around the inferred opinion of the CEO and conflict with one another only when it is politically expedient.

Simple advice for CEOs:  actively encourage your people to challenge your ideas.  Trust them with your reputation and your ego.  As a CEO, this is the greatest level of trust that you can give.  They will return it with respect and honesty and with a desire to be vulnerable among their peers.

Self assessment:

  • Do you have a hard time admitting when you're wrong?

  • Do you fear that your direct reports want your job?

  • Do you try to keep your greatest weaknesses secret from your direct reports?