At C-Level #3: How many bosses can a CEO have?
At C-Level #3 is the third blog of an eight-part series following a first time CEO’s educational journey in a very challenging business environment, and exploring global concepts in leadership theory and practice.
At the end of each blog are reflection questions for readers to consider as they navigate their own leadership journey.
This guest post by Mike Sayre — experienced software, e-commerce and manufacturing services CEO, COO, CFO and Board Director—is based on his first-hand experiences as a fledging CEO. Its intent is to provide additional insight or ideas to those in, close to, aspiring to, or trying to understand the top leadership role in any organization. Mike was also featured in the October 4, 2016 Innovative Leadership, Co-creating Our Future interview with Maureen Metcalf on VoiceAmerica focusing on the importance of leader trustworthiness in driving organizational change.
As you know from my previous At C-Level posts, I was a first time CEO of a manufacturing services company lacking in leadership and focus, who created a leadership tool – further refined by the company’s leadership team – in the form of a “philosophy card” containing a company mission, vision and operating guidelines that aligned with my own personal mission, vision, and operating philosophies. “The card” was often referenced by the leadership team and employees, now referred to as “associates,” to keep everyone focused in the same direction and reduce a lot of first-level noise around decision-making processes.
However, the importance of “the card” extended far beyond the leadership team and even the company’s associates. When I took over the CEO responsibilities, I understood I reported directly to the board, who represented the shareholders of the company. But I quickly realized I also had additional responsibilities to serve several other groups, or “bosses,” as well!
Appropriately then, the company’s new mission statement needed to reflect all my new “bosses,” which I preferred to refer to as our company’s stakeholders. One of the goals of this rather lengthy mission statement (and lengthy mission statements are not traditionally recommended) was to get everyone in the company to think about their responsibilities from a more global perspective.
Here is “the card” with the company’s mission and vision statements (the operating guidelines were on the reverse side):
For now, let’s just look at the mission and to what the team referred to as the “stakeholder star” with its five points that represent the five key stakeholders in the company and our major responsibilities to them: shareholders, associates, customers, suppliers, and communities.
In strategic, and even many tactical, decision-making processes, the “stakeholder star” was used by the leadership team to make sure they thought through the effects any final decisions would have on all the stakeholders moving forward. Many decisions favored one or two groups over the others, but not without going through the thought processes of how everyone was going to be affected, and making informed and conscious decisions with that information in mind.
In addition to the mission statement being given to current, prospective, and new company associates on the philosophy card, it was also posted on the company’s website. We gave the philosophy card to shareholders, customers, suppliers, and other community leaders as well. It outwardly displayed the company’s commitments to all its stakeholders and was greatly appreciated and respected. When the company expanded into Europe and Asia, “the card” and the demonstration by the leadership of how the company lived by it were attractive to eventual partners and new associates.
It’s Important to remember that as a for-profit public company, my number one fiduciary responsibility as CEO was to maximize the shareholders’ return on the investment. Unless you own the company, the shareholders employ you.
However, many C-level leaders underestimate how important it is to have all of the stakeholders cooperating to achieve those desired returns. Many leaders focus on one or two stakeholders without considering the rest. Understanding why all your key stakeholder groups are involved and what their expectations are is very important.
In addition, it’s essential to communicate that decisions are consistent with your mission and vision, and how the decisions you make will eventually get the stakeholders what they want. Managing their expectations is key. Utilizing the stakeholder star helps you better understand and be able to convey the trade-offs between stakeholder groups. It is a delicate balance.
My first CEO leadership journey paralleled a model called Conscious Capitalism that is currently getting significant attention in leadership development circles. I did not know it at the time, but we put into practice what the Conscious Capitalism movement seeks to accomplish.
In Maureen Metcalf’s recent “Innovative Leaders Driving Thriving Organizations” interview with Thea Polancic, the founder and executive director of the Chicago Chapter of Conscious Capitalism, Inc., (interview link) Metcalf and Polancic discussed the four pillars of Conscious Capitalism:
- Conscious Leadership – leadership motivated by a purpose
- Stakeholder Orientation – leadership attending to the health of an “ecosystem” of stakeholders, constantly balancing competing needs and expectations
- Conscious Culture – cultural agreement throughout the organization to accomplish the organizational purpose or mission
- Higher Purpose – the business has a higher purpose in addition to making money: money and profits are required as the fuel that feeds the organization’s ability to deliver on its purpose
My journey developing clarity around my personal purpose, aligning the company mission, vision, and operating guidelines, creating “the card,” and building a purpose-driven culture –
including how the mission statement was used to instill a stakeholder orientation in the company – is an example of how Conscious Capitalism can be successfully implemented and work in an organization.
Prime examples of major companies practicing Conscious Capitalism today include Whole Foods Market, led by CEO John Mackey, and Southwest Airlines, led by former CEO Herb Kelleher and current CEO Gary Kelly (Southwest’s former CFO).
- Who are the major stakeholders in your company?
- If your business stopped operations today, who would be affected?
- If a key stakeholder stopped supporting the company and/or ceased to exist, how would it affect your organization?
- What do you think is your major responsibility to each of your major stakeholder groups? How do you consciously, or unconsciously, fulfill those responsibilities today? Are you fulfilling those responsibilities?
In At C-Level #4, Mike will discuss the company’s ambitious vision on “the card” and how achieving the vision was measured.
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Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify, Amazon Music, Audible, iHeartRADIO, and NPR One. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.
About the Author
Mike Sayre, executive advisor and organizational transformation practice lead, has been a successful CEO, COO, CFO and board director for multiple organizations in technology (cybersecurity, ecommerce payments processing and engineered computer products) and manufacturing (electronics and steel products). He shares his expertise with client boards and C-Level leaders, and advises, designs, plans, and oversees the implementation of successful strategies for turnarounds, growth, profitability and sustainability.
Mike brings 25+ years of organizational and business leadership and hands-on implementation experience to his clients. His teams have achieved significant increases in growth, profitability and valuation, as well as shareholder, customer, supplier and employee engagement and satisfaction.