WHY CEOs FAIL

and how to prevent it.

An approach to rapid organisational change

Research and statistics show that over 40% of new CEO or Business Unit Head appointments fail to meet performance expectations in the first 18 months.

Interestingly, most of it is NOT their fault, and it IS preventable. Symptoms you may see are:

  • Managers operating below their actual position. It's not uncommon to see this happening at least 40% of the time; so staff aren't allowed to "own their piece", restricting their growth and development; and impacting engagement.
  • 70-85% of the leadership team, the functional leaders, don't have a "ready to go" successor in place; so if one leaves the business unit head gets sucked down a level to keep things running.
  • The leadership team isn't actually a TEAM. They are a group of functional heads who spend 90% of their time running their function, and 10% reporting up; so the business unit head has to get involved in everything that crosses functions.

We understand why this happens; and how to prevent it.

There are 4 main leadership transitions on the journey to a General Management role (CEO).

Each transition has some risks associated with it. These risks add up to the situation that can cause the CEO to fail; especially one new to the role. The organisation is a connected entity, a bit like a concertina, so if any of these transitions cause the problems outlined below, there is an impact on everyone; above and below. For example, a middle level manager who spends a lot of time as the "expert problem solver" to direct reports does not have the time to do strategic thinking and planning. This pulls their boss down a level to get this done AND suppresses the development, and hence engagement, of their direct reports.

Transition 1
Leader of Individuals
Transition 2
Leader of Leaders
Transition 3
Leader of Function
Transition 4
Business Head (CEO)

We tend to get promoted based on our capability in the job we are leaving (the best techie gets made techie manager etc.). When people approach you with a problem to solve, it is so easy to think, “Aha, that’s why I got promoted, move aside and let me fix this.”

Again, the temptation is to go in and solve problems. Typically, a junior manager beneath you has some issues with one of their staff, so you helpfully deal with it for them. But your role is to develop their leadership skills, not get caught up in the detail.

You are now on The Leadership Team as head of production, marketing, HR etc. The tricky part here is that you are actually making two moves; the first to being the leader of your function, the second is that you are joining the leadership team.

You have a leadership team reporting to you. But they are NOT a team; they are just a group of functional heads. To cross silos, you have to get involved. And if anyone leaves, there’s a gap; because none of them have a successor  who is “ready to go”.

Transition 1
Leader of Individuals

We tend to get promoted based on our capability in the job we are leaving (the best techie gets made techie manager etc.). When people approach you with a problem to solve, it is so easy to think, “Aha, that’s why I got promoted, move aside and let me fix this.”

Transition 2
Leader of Leaders

Again, the temptation is to go in and solve problems. Typically, a junior manager beneath you has some issues with one of their staff, so you helpfully deal with it for them. But your role is to develop their leadership skills, not get caught up in the detail.

Transition 3
Leader of Function

You are now on The Leadership Team as head of production, marketing, HR etc. The tricky part here is that you are actually making two moves; the first to being the leader of your function, the second is that you are joining the leadership team.

Transition 4
CEO

You have a leadership team reporting to you. But they are NOT a team; they are just a group of functional heads. To cross silos, you have to get involved. And if anyone leaves, there’s a gap; because none of them have a successor  who is “ready to go”.

To ensure success:

Everyone needs to be operating at the right level, and doing the right things.

  • The business head needs to articulate the Purpose of the business unit; then coach their leadership team to deliver it.
  • The leadership team members need to free up time to coach their team AND be an active member of the Leadership Team.
  • The leadership team need to define how they will operate together as "The team that runs the business".
  • The leadership team need to identify the behavioural changes they will need to make.

When this is done you can start to look at the leadership capability of managers at all levels and roll out skill improvement as required.

The Project would look like this:

We initially work at the top 2 levels with your Business Head and the Leadership Team:
  • Workshops to improve capability in leading and coaching direct reports.
  • Workshops for the leadership team to identify how they will work together and what changes they need to make.
  • 1:1 coaching to support putting change into practice.

During the project we work with you to define the most effective way to roll sustainable skill improvements down the leadership pipeline using a range of tools and interventions we have available.

 

 If you are seeing any of these transition symptoms
and you would like to do something about it;

fill in the form below to arrange a diagnostic conversation with us.

Your coaches

Tony Latimer MCC BCC

Aurelie Prigent ACC