This blog post was inspired by a Stephen Colbert bit called “Who’s watching the Watchdogs” that aired on TV a couple of nights ago. In this spoof, Colbert attempts to hold Consumer Reports accountable for holding corporations accountable for product quality and safety. It is a brilliant parody of someone not knowing much about what an organization does, trying to be tough in holding them accountable for what they do. After you have read this post and have about 7 minutes, watch the video to see the tie in and have a good laugh.
Colbert’s story line struck me as similar to the challenge of holding a CEO accountable for holding the rest of the organization accountable for doing the right things. In public corporations, this task falls to the board and shareholders, assuming they are close enough to what is happening in the organization to know what really has to be done. But who holds the CEO accountable in family or privately owned businesses, where there is little or no board involvement?
CEOs are human with strengths and weaknesses, just like the rest of us. And just like the rest of us, they tend to shy away from things that are outside of their comfort zone, and gravitate towards those things that they enjoy doing and are good at. There also can be a difference between knowing what to do, and doing it.
Many small business executives are turning to CEO peer accountability groups to meet this need. These are groups of 10 to 20 CEOs committed to growing and improving their businesses. The groups attend monthly meetings chaired by a former CEO and skilled facilitator, to help each other address their key business challenges and hold one another accountable. To assure that members are totally open in discussing their issues and challenging one another, no competitors or companies doing business with one another are allowed in the same group.
The other day, a member of such a group told me how peer accountability dramatically improved his business. Like many entrepreneurs, he had a marketing background and loved to sell, but had little interest or experience with operations. For years he had tried to coach and develop a plant manager that he felt wasn’t effectively leading his team or operating his plant to its full potential. He was reluctant to make a change, however, because he didn’t know much about operations, the plant was in a remote city, and there just never seemed to be a “convenient” time to take on the headaches of replacing him.
When it was his turn to host a meeting, this CEO presented his strategy and challenges for the next year, among them being to get his plant manager on board. His peers, having heard about his problems with this guy for a couple of years, confronted him. They asked him if he had been successful at personality transplants before and whether he really thought he was going to change this guy. When he said probably not, they asked if he felt he needed to replace the guy. When he answered yes, they asked him if there was any reason the guy would still be working for him when the group met the following month. He laughed and said, apparently not.
This CEO said that while he knew it was the right thing to do, it took the group to get him to bite the bullet and make it happen—he didn’t want to have to face them again having taken no action. In hindsight, he says it was one of the best decisions he has ever made. The plant has performed much better under new leadership, and one of his biggest stressors has gone away.
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Increase your CEO effectiveness by finding an objective source of accountability.
- Network with other CEOs to find someone that can provide a useful sounding board and informally hold you accountable for making tough decisions.
- Hire an executive coach to challenge your thinking and hold you accountable. (see case study)
- Join a monthly CEO accountability group to get the “unvarnished truth” and be challenged by objective peer CEOs who are committed to your success.