Why Should the Boss Listen to You?

The Seven Disciplines of the Trusted Strategic Advisor

James E. Lukaszewski

• Publisher: Jossey-Bass
• Year: 2010
• Print ISBN:
  9780787996185
• Edition: 1
• eBook ISBN:
  9781118041123
• Topic: Business
• Subtopic: Leadership
• Index: Business

This is a book about gaining influence and becoming a key trusted advisor. It is for everyone who advises leaders and senior managers (accounting, finance, human resources, IT, law, marketing, public relations, security, and strategic planning) and for outside consultants in these functional staff areas. It's also for operations people yearning to finally be heard and heeded by their boss.

Part One

THE REALITIES OF ADVISING TOP EXECUTIVES

1

HOW LEADERS THINK AND OPERATE

The Pressures, What Matters, the Obstacles, and the Solutions

The place to begin our discussion on achieving the status of a trusted strategic advisor is to talk about the world of leaders and about how leaders operate. The environment of leadership; the expectations of leadership; the duties, responsibilities, and perception of leadership and especially of business leaders have changed in many important ways in the last quarter century. Becoming the CEO of a multinational company, a large local utility, a taxi company, or a dairy, or even to become the superintendent of the school district, used to represent the pinnacle of one’s lifetime achievement. That, too, has changed. There are many powerful new realities that drive the world of today’s CEO, as we will see in this chapter. Becoming a trusted strategic advisor in this changed and changing environment requires a clear sense of the new realities and of the role CEOs play.

Pressures Leaders Are Under

Let us look at the CEO’s world. It is very, very different than most people imagine. All training for CEOs is on the job. There really is no school for becoming a CEO. A chief operating officer, watching from next door, second-guessing her boss, certainly thinks that she could run the place better. Yet the moment she gets the top position, the new incumbent instantly realizes that the job is completely different from anything that she could have possibly imagined. The new CEO also notices that she is alone, there is only one CEO in the organization, and everyone is watching.

Every single day for a CEO is a new learning experience because there is no manual and no one to train him. To his surprise, the CEO discovers just how limited his freedom to act really is. Wait a minute, you say—the CEO is the boss; he can do anything. The reality is very different. Being a twenty-first-century CEO is extraordinarily stressful.

Leaders Are Having a Lot Less Fun

A brief tour of today’s executive leadership world will reinforce your understanding that these jobs are extremely difficult, challenging, and frustrating.

Studies by business organizations, executive search firms, and government indicate that the average tenure of corporate leaders is declining, as is the average tenure of their key staff. There are two patterns emerging, one global, one local. As larger organizations globalize, one of the most significant features is the youth of their leadership. For example, in nine global companies in which I have recently worked, each headquartered outside the United States, the oldest CEO is around fifty years of age. The downward trend in the age of CEOs puts pressure on the average age of managers and leaders in these organizations. In the past, a CEO usually got the job at around the age of fifty-five and held it until age sixty-four or sixty-five. Today, the CEO can be as young as forty-five or so, and may or may not stay beyond age fifty-five. It is a continuing trend that has yet to be clearly explained.

The second pattern is that younger people in general know a lot more than they used to, and at a significantly lower age. The amount of knowledge a thirty-five-year-old can bring to the business in the modern era is perhaps two to three times what it was just twenty-five years ago. These younger managers are indeed capable of leading large business organizations earlier in their careers.

In 2006, more U.S. chief executives changed jobs than in any other year in recent history. One-fourth left to take other CEO positions, one-fourth retired, one-fourth left on their own and went elsewhere, and one-fourth were kicked out. Special note: during 2006 and into 2007, a large number of CEOs resigned their positions due to scandals involving their complicity in option grant backdating.

Fewer than half of involuntarily retired executives regain a comparable position in their lifetime. More and more management literature is being devoted to these individuals and their inability to recover following sudden, unplanned separation from their top jobs.

Nonoperational issues—for example, global impacts, adverse legislation, and anti-corporate activism—are intruding with greater regularity. These interruptions are “soft” and highly emotional, and they require an entirely different attitude—frankly, one that goes beyond those taught by management schools. The Sarbanes-Oxley legislation, enacted by the U.S. Congress in 2002, introduced a distinctly moral focus into daily operations, an approach that continues to antagonize and irritate many business leaders. This legislated moral focus is frustrating for staff functions to discuss, decode, and decipher. Sarbanes-Oxley forced integrity and compliance concerns forward, basically through threat of criminal prosecution. This legislation has gotten management’s attention at every level, but especially at the top, where the greatest risk now rests. These laws now mandate that managers of public companies are responsible for creating an “environment of integrity” within their organizations. These moral mandates are particularly difficult because they go against the grain of current management theory, which treats anything that is emotional, nonscientific, or not readily measurable as irrelevant and distracting.

Another nonoperational issue for large local and national companies, but especially for global companies, is the rise in power and influence of nongovernmental organizations (NGOs). NGOs are sometimes referred to as watchdog organizations. If they see something that offends them, they can go public, get activists to attack, or generate pressure from government. This has introduced a whole new level of stress, strain, and potentially negative visibility for business organizations and their leaders.

In large organizations, globalization increasingly requires staff functions to work together across intellectual, national, and cultural lines, and around the clock. It is definitely becoming more complicated to be a senior staff advisor in large organizations. The demands on the leader have increased significantly. On the one hand, leaders are asked to do more, faster; on the other, they are forced to reduce staff support, as an indicator of their management capability.

With all these distractions in the management and leadership environment, coaching and counseling leaders require important fundamental shifts in the advisor’s mind-set. The trusted advisor needs to realize that the CEO, though still captain of the ship, is operating under increasingly complicated and uncharted navigation rules and pressures.

The Limits of Leadership

Deciding on a course of action is one thing, but getting the organization ready, willing, and able to move in that direction is an entirely different task. Successful leaders and their advisors learn to recognize the limits of CEO effectiveness.

One of the first large companies I worked for retained me to develop a marketing strategy for one of its highly technical product divisions, which was beginning to plateau as more competition entered the field. Another person and I spent significant time developing several unique approaches for the organization to consider. When we made our presentation to senior management, it was enthusiastically received. The senior managers were engaged in conversations; they asked questions and actually remarked at how sensible and important all the ideas we presented seemed to be. It was one of the best presentations I can recall making in all the years I have been a consultant.

We all went to lunch together, and I sat next to the CEO, whose name was also Jim. He seemed quite pleased. So I asked him, “With the reception this morning, how much of what we proposed is likely to be initiated?” Without hesitating, Jim said, “I’d guess about 4 or 5 percent.”

I was absolutely stunned. “Jim,” I asked, “did I make a mistake? Did I misunderstand what happened this morning?” Jim’s answer was again quick and profound. He said, “Look, I’m just the CEO here. This place is run by the seventy-five hundred employees who show up to work every day. What they will want to do and can do will determine the direction we’re going. I’m fifty-seven years old; if I stay healthy, I’ll probably be chairman here for another seven to eight years. Absent some catastrophe, such as tremendous business loss, stock drop, or takeover, if I can move this organization five to seven degrees in new directions every year, I will have made a substantial contribution during my brief term as leader. We’re kind of like an aircraft carrier,” he said. “Once we choose a direction, it takes a lot of energy to change that direction. Of course, torpedoes, hurricanes, or collisions can make a big difference if they come along.”

Leaders recognize and work to maintain the direction of their organization and what it takes to change, reshape, and perfect that direction. A leader’s aspirations and behaviors often create a response among staff functions that causes people to overestimate the potential in situations and to be overly optimistic about results and about what can be changed. The leader’s immediate staff often seem eager simply to move key organizational components or ideas around according to some checklist or set of theoretical ideas, based on what they assume the boss wants. The lesson of Jim’s seven degrees is that the greatest successes are often the result of what first appear to be underwhelming decisions or actions. Although much is desired, far less can actually be achieved; yet meaningful progress will still be made. This relentless focus on meaningful but small incremental progress often yields big surprise advantages over the long term.

The Loneliness of Leadership

The concept of leadership loneliness will echo throughout the pages of this book. Several predictable consequences occur as an individual is elevated within an organization. First, the sense of isolation and loneliness tends to increase because fewer people are privy to information at higher levels.

Second, a filtration and sanitizing process occurs as information is passed up to the top. Mitigating this isolation of leadership is one key role for the trusted advisor. Jack Welch, being interviewed on public television shortly after he had retired from his chairmanship at General Electric, was asked by an interviewer, “What was the worst part about being chairman of this huge corporation?” Welch answered without a second’s hesitation, “Being the last to know.” This circumstance does tend to be a great frustration to those who lead.

Third, the higher the altitude, the thinner the leader’s skin and the greater and more personal the criticisms they must endure. With increasing seniority can come decreasing tolerance for questions, questioners, those who push back, and people with negative approaches. This can be a fatal flaw in management leadership. It is a major cause for isolation at the top and a powerful barrier to the executive’s knowing what really is happening at various levels in the organization. This behavior can be perceived as arrogant and intolerant.

Fourth, as managers advance and become senior managers and leaders, the “Yes, sir” mentality that pervades these high-level environments leads to the belief that leaders are good communicators, financially savvy, and aware of their surroundings and the risks they face. They have enough mathematical competence to get along. Absent sensible and meaningful evaluation, what else are they to believe?

In this environment, at this altitude, it is a principal role of the trusted strategic advisor to recognize these four circumstances and constantly, relentlessly, and endlessly help the CEO work against these patterns.

What Leaders Do

The CEO has three powerful assignments in any organization. The first job is to look to the future—that is, go over the horizon to see what is out there and then come back and tell the organization a bit about where it is headed; perhaps what some of the pitfalls might be; and, most important, what some of the deadlines are. The second principal task of the CEO is to find the people power required to achieve the organization’s mission. Unlike the manager, whose job is to achieve objectives, complete programs, and work inside the box, the leader must work almost exclusively outside the box in this energizing arena of strategy, future accomplishment, and managing the destiny of the organization. The third assignment is to decide, to make choices. As the leader’s career advances, his decisions become larger and the consequences broader. The leader’s ongoing jobs are observation, education, course correction, evaluation, and motivation.

Leadership success depends on leader-driven communication. In fact, personal communication, in good times and bad, is the most powerful tool leaders have. When we examine how to move organizations, successful leader-communicators follow a fairly interesting pattern of mostly verbal communication and participation with their employees, executives, and others. The following is my empirical analysis of top management activity:

Analysis of Top Management Activity

Decision making	5%
Articulating the decision	30%
Coaching, teaching, motivating to carry out decisions	30%
Forecasting (guessing) the next decisions	5%
Admiration building	6%
Reputation repair	4%
Repeating, reemphasizing, reinterpreting decisions	20%
Total	100%

As you can tell by this distribution of time, the CEO and senior leadership will be spending significant amounts of time explaining, coaching, interpreting, reiterating, and monitoring the progress of their strategies, plans, and outcomes. This is far different from the notion that these senior people are busy making big decisions every single day about things that can change the company’s direction or the company’s history. Even during enormously stressful times, such as mergers, acquisitions, takeovers, or divestitures, the actual number of major decisions executives make is...

Table of contents

• Praise
• Title Page
• Copyright Page
• Dedication
• Preface
• Acknowledgments
• About the Author
• Introduction
• Part One - THE REALITIES OF ADVISING TOP EXECUTIVES
• Part Two - THE SEVEN DISCIPLINES
• Conclusion
• Index