When it comes to creating an organizational culture that empowers the entire enterprise to implement strategy, tackle big goals and make the changes necessary to thrive in our fast-changing world, there is no single silver bullet.
But if you could implement just one organizational development initiative, ensuring your executive team is as effective as possible might bring you the biggest return on investment for your development dollars.
Executive teams are more than just a group of senior leaders. Individually and collectively, how they function creates the template that other teams throughout the company follow. From headquarters to the front line, in every functional unit and every geographical division, individuals and groups look to the executive team not only for explicit leadership direction, but also to understand the company’s values, how they should behave, and how they should interact and engage with each other.
Executive Team Must-Dos
Executive teams have three crucial imperatives:
- Strategic focus. The top team is tasked with establishing a vision, investing time and energy at the strategic level, balancing risk and innovation, anticipating future needs and opportunities and ensuring the future sustainability of the organization.
- Collective approach. Executive teams don’t just work together; they work to achieve common goals through a common strategy. That means they must take an enterprise view, put the good of the enterprise over individual or functional area gains and model how to break down silos while creating solutions collaboratively.
- Team interaction. Finally, the executive team sets the culture that all teams in the company will adopt. To be effective, executive teams must value differences among team members, communicate effectively with each other, ask each other for input and trust and respect each other.
When the executive team consistently executes on all three of these imperatives, organizations tend to do well. When they don’t, the organization is likely to encounter rough waters.
Symptoms of Executive Team Underperformance
Most executive teams leave at least some growth potential — for themselves and the enterprise — on the table. Why? Because most members of the executive team are functionally oriented, meaning they often struggle to act collectively with an enterprise view. Often, we find that members of the executive team don’t know how to interact and collaborate collectively. In fact, many of them don’t know what differentiates being on an executive team and what that nuance entails.
Wondering if your executive team is underperforming? Here are five symptoms we often see in underperforming senior teams.
- They fail to communicate and model enterprise awareness down through their direct reports to the larger organization.
- They don’t drive cross-boundary collaboration to eliminate waste and create new value.
- They don’t leverage diverse, multidisciplinary perspectives for planning and strategy, figuring out what to keep and what to discard, what they need to learn and what to start.
- They fail to foster “bottom up” insight, awareness and ideas. Information doesn’t just flow down from the executive team to the rest of the organization, but should also flow up and across the organization.
- They don’t examine their differences well — openly, using assertions and questions.
When executive teams underperform, fixing them starts with the most senior executive — the CEO or equivalent role. One of the most important roles for any chief executive is to be the chief development officer for the executive team.
Though shaping a group of driven, high-performing senior leaders into a strong executive team is challenging, it boils down to a handful of key tasks.
Diagnosis. The chief executive and executive team members must understand themselves and each other. The CEO must also understand what drives each individual on the executive team and what makes them work as group.
Set the leadership model. Executive team members must understand how to explicitly lead beyond their circles of personal influence in a way that’s consistent with the organization’s culture and strategy.
Establish the mindset. High-performing executive teams have a shared growth mindset. They know they must learn, grow and lead in areas beyond their technical expertise, becoming true enterprise leaders.
Create interaction rules. Executive teams should set explicit expectations about how they will behave and interact. That includes being transparent and vulnerable, being comfortable learning in public and coming equipped with strong dialogue skills.
Diffuse the DNA. Finally, executive teams are most effective when their actions and decisions — and the thinking behind them — are spread quickly and accurately throughout the organization, to teams and individuals they don’t interact with personally. The “how we think” and “how we do things around here” starts with the executive team but becomes a core part of the organization’s cultural DNA.
Alice Cahill is the director of the organizational leadership practice at the research and advisory firm the Center for Creative Leadership. Lawrence R. McEvoy II is an executive-in-residence at CCL and former CEO of Memorial Health System in Colorado. Laura Quinn is a member of CCL’s organizational leadership practice. To comment, email firstname.lastname@example.org.
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