Why CEOs Can’t Dance Redux
Let us face it, CEOs often isolated themselves from the average employee. (We wrote and challenged them about this seven years ago.) Most still sequester themselves in the penthouse office of the corporate headquarters. They cannot dance with employees because they think they are too busy to engage employees. Dancing here refers to engaging, supporting, and communicating with employees in multiple ways. Too many do not dance because they have lost touch with reality. They operate in a bubble and do not attend the party.
For example, The Great Man showed up for budget review in a white limo, flanked by two black SUVs. He entered the building protected by multiple bodyguards. Local executives gave presentations to him on a stage in an auditorium setting. This CEO sat up in the stands. All lights were off except a spotlight on the presenting manager and the CEO’s reading light. When things were not right, he interrupted or degraded them. This archaic practice motivated no one. It wasted time and generated fear and insecurity.
CareerBuilder found that 40% of employees do not even know their CEO’s name. Worldwide, all employees agree that CEOs do not bring the value that supports their pay scale. For example, CEOs pay is 399 times more than the average worker. Yet, their work cultures produce 85% disengaged employees. Because of this, CEOs are leaving a tremendous amount of employee potential talent and contributions on the table. By not dancing, CEOs cost their companies billions of dollars of lost employee innovation, productivity, and customer service. Here are three reasons why CEOs let this happen:
CEO priorities upside down
Among CEO top priorities are sales growth and profit. While companies must grow and make money, executives often forget how it happens. They pay way too much attention to shareholders, numbers, and data and not enough to the power of people. Customer loyalty generates sales growth and profit. Customer loyalty comes from an exemplary customer experience. Employees determine the quality of a company’s customer experience.
Consider GM as a case study. In the 1940’s, Peter Drucker praised the company for its product decentralization but criticized it, even back then, for treating employees as a feudal cost center rather than a base of knowledge and potential. The lack of quality for their customers has dogged GM for years. Even today, GM has record recalls. A finance executive said this of the decades-old corporate attitude, “We are GM. We know everything. We don’t need to change.” How wrong they are! GM market share fell from 62.6% to 17.9%, from 1980 to 2015. In between, we all know about the bankruptcy and bailout. The point is, unfortunately, so many companies have the same attitude about employees and customers today.
CEOs do not communicate well
According to management studies, a key reason leaders derail is that they do not communicate well. According to Dr. Travis Bradberry, CEOs and other executives have the lowest emotional intelligence skills of all management levels. Research shows that CEOs only spend 4.3 hours a week on people management issues. These means they are not good at one-on-one conversations, cultural sensitivity, listening, team building, managing their emotions, managing conflict, or communicating vision and strategy clearly. This list goes on, but you get the picture.
A global IBM study found that 33% of CEOs had engineering degrees and another 15% had finance degrees. CEOs focus on data, facts, figures, and metrics. No wonder the #1 issue on employee engagement surveys is the lack of communication. CEOs tend to think communication is too “soft” to pay attention to it. Yet, according to the change master, Kotter, 70% of their strategies fail to reach their intended outcomes because of poor execution. A lack of communication is the usual culprit. As an employee, I am sure you can identify with the poor communication you have seen from your employers related to expectations, priorities, medical benefits, lack of recognition, policy changes, and work procedures. Most, if not all, of this is avoidable.
CEOs project misplaced values
Over 60% of all CEOs say that creativity is their most important trait; only 12% say fairness and humility are. Kouzes and Posner, authors of The Leadership Challenge, found that over 80% of managers value honesty as a key characteristic in their leaders. Yet 82% of employees do not trust their boss, according to the Edelman’s Trust Barometer. Too many employees do not trust their companies either. Now I know CEOs that are exceptional leaders; however, far too many CEOs think more about their profits, perks, and paycheck than their people.
The book, The Speed of Trust, by Stephen M.R. Covey, demonstrates that the lack of integrity and ethics causes problems for managers and companies all day long. If the culture of a company is about countless checklists, policies and procedures, employees will begin to look over their shoulders rather than doing a fantastic job. The employee’s task becomes hiding mistakes as opposed to doing a better job. With trust, most people rise to the occasion and go the extra mile. Fred Kiel is author of Moral Intelligence and Return on Character. He shows that corporate leaders-servant leaders-with high integrity and compassion have greater returns than leaders who are egotistical and self-absorbed.
Pulling It All Together
Those CEO’s who do not dance think business is only about the bottom-line. It is really about people: employees and customers. Richard Branson, founder of the Virgin Group of four hundred companies, has built a large organization on this very principle. He is dancing, having an exciting time and so are his people. Wouldn’t that be an enjoyable way to invest and spend your working years? In backlash to toxic workplaces and the GREAT Resignation, a revolution about people-first through Servant Leadership marches across the global. Successful CEOs of the future will dance with the movement.
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In addition, do you want to really advance your management career? Check out Rick’s best-selling books, The Superstar Leadership Model and The 5 Dynamics of Servant Leadership.
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