Thinking Big: Articles and Thoughts on Business Practice

CEOS Who Fail at Business Management: Are You One of Them?

Susan Adams of Forbes wrote a recent article about an interesting bit of research regarding the functioning of the average CEO.  A joint study conducted by The Miles Group, the Center for Leadership Development and Research at Stanford and Stanford’s Rock Center for Corporate Governance has found that too many CEOS are failing in an area which should be considered one of the most important: people management.  Being too focused on the bottom-line, they are ignoring the need to mentor, to engage their boards, to foster a positive atmosphere where people can flourish.

Stephen Miles, CEO of The Miles Group, indicated that the study showed a deep concern among managers over the weakness at the top of these organizations.   “Focusing on drivers such as developing the next generation of leadership is essential to planning beyond the next quarter and avoiding the short-term thinking that inhibits growth,” he said.

Boards and CEOs are inordinately preoccupied with the financial well-being of a company, weighting the personal aspects of the job extremely low.  The researchers say that it is essential for a successful CEO to reach beyond that concern for numbers, and  to care about the human beings they manage.  Their disengaged quality, and apparent lack of concern for employee well-being, are being seen as some of the main reasons for employee dissatisfaction and ennui, for high turnover and a less than cohesive work force.  Mentoring skills, developing internal talent, modeling compassion and empathy, displaying listening skills — all are essential to a well-run company.

The research also revealed that 83% of directors and 64% of board members believed that a CEOs own performance should be evaluated with a balanced look at financial performance and those personal measure.  The reality, however,  is that the personal measurements count very little in the corporate culture.  “Unfortunately, the truth of the matter is that the CEO evaluation process is not that balanced,” said Stanford’s David Larcker, co-director of the Center for Leadership Development in a statement. “Amid growing calls for integrating reporting and corporate social responsibility, companies are still behind the times when it comes to developing reliable and valid measures of nonfinancial performance metrics.”

So, the question then becomes:  Just how do we reconfigure corporate culture to include the values of personal interaction, mentoring, succession grooming, and overall people skills?  Are there any MBA programs or other training programs that emphasize a more balanced approach?  Any that teach people skills?  Empathy?  I would love to hear from anyone who knows of programs that provide an equal emphasis on such skills.

One student at my own university confided to me that she had formed a group at our business school to raise awareness that the university was purchasing its logo merchandise from a company that was known to use sweatshop labor.  Although she was warned by several of her professors to “let it go”, and told that “this isn’t our focus here”, she persisted.  The result was that her organization raised enough awareness, that the university has since promised to find a new supplier and to more carefully vet the company for its production and hiring methods.  So, is the question one of the courageous individual who insists that ethics and morality and consideration of the human factor be part of the corporate model?  Or is it possible to bring this sort of value system to full scale?  Obviously, concern for the human factor in the corporate culture must expand to view, just as my own student did, the larger picture.  It must go beyond the people skills involved in your own office or corporate headquarters, to considering the largest possible picture of worker respect, nurturance and care.

A few years back, former Mozilla CEO, John Lilly, wrote of the importance of developing such skills.  But in his case, the struggle was also a personal one, after he had a moment of clarity around his own lack of people skills.  He was a quiet and introverted personality, something of a typical engineer, who realized that he had to break out of that behavior in order to engage people.  His perspective changed when he finally understood,  “We hired awesome people. They just don’t know how to do this yet. So let me act like a teacher and help them figure out how to learn and how to be really good at this.”

More and more, our cultural is becoming global.  More and more, we need to develop skills not only to mentor and support employees, but to fully engage with the inter-cultural nature of our companies.  I would love to hear from CEOs and other business leaders who have worked to make the human factor a larger part of the business value system.


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