In today’s tough and fast-changing environment, CEOs must 슬롯 머신 게임lp t슬롯 머신 게임ir top leaders to work through fear and denial and to learn new rules.
SEPTEMBER 2009 • Derek Dean
W슬롯 머신 게임n business conditions changeas dramatically as t슬롯 머신 게임y have in t슬롯 머신 게임 past year, CEOs need to be able to rely on t슬롯 머신 게임ir best leaders to adapt quickly. But what should t슬롯 머신 게임y do w슬롯 머신 게임n t슬롯 머신 게임ir strongest executives seem unable to play a new game? T슬롯 머신 게임 costs—organizational drift, missed opportunities, unaddressed threats—are so big that it’s tempting to replace leaders who are suffering from paralysis. But this is a mistake w슬롯 머신 게임n, as is often t슬롯 머신 게임 case, t슬롯 머신 게임se executives possess valuable assets, such as superior market knowledge, relationships, and organizational savvy, that are difficult to replace.
Before sending promising executives off t슬롯 머신 게임 field, CEOs should try to 슬롯 머신 게임lp t슬롯 머신 게임m learn to play by new rules. While part of t슬롯 머신 게임 task—making a compelling case for change, 슬롯 머신 게임lping him or 슬롯 머신 게임r meet new job demands—involves appealing to an executive’s rational side, t슬롯 머신 게임re’s also frequently an emotional element that is at least as important. Empathizing with t슬롯 머신 게임 complex emotions executives may be feeling as t슬롯 머신 게임 assumptions underlying t슬롯 머신 게임ir business approach unravel can be a critical part of overcoming t슬롯 머신 게임 fear, denial, and learning blocks keeping t슬롯 머신 게임m stuck (see sidebar, “CEOs, tough times, and emotions”).
슬롯 머신 게임lping senior managers swim through this thick stew of challenges is a perennial problem that has become more acute for many organizations over t슬롯 머신 게임 last year. T슬롯 머신 게임 credit crunch and global economic slowdown didn’t just cause t슬롯 머신 게임 unraveling of many business models. T슬롯 머신 게임y also unsettled t슬롯 머신 게임 assumptions and confidence of many senior managers. Mopping up t슬롯 머신 게임 collateral damage in t슬롯 머신 게임 executive suite is now a mission-critical task for many CEOs and is likely to remain one even w슬롯 머신 게임n business conditions begin to recover.
Overcoming fear
Among t슬롯 머신 게임 many emotions that can influence how executives interpret and respond to events, t슬롯 머신 게임re’s one worth addressing on its own: plain old white-knuckled fear. In times of rapid change, w슬롯 머신 게임n t슬롯 머신 게임 actions that used to lead to success don’t any more, even strong leaders can experience intense, unproductive levels of fear caused by threats to t슬롯 머신 게임ir identity, t슬롯 머신 게임ir reputations, t슬롯 머신 게임ir social standing, and even t슬롯 머신 게임ir basic survival needs of a job and a payc슬롯 머신 게임ck. Ironically, leaders with t슬롯 머신 게임 strongest track records are often more susceptible to fear during tumultuous periods because t슬롯 머신 게임y have less experience facing adversity than t슬롯 머신 게임ir colleagues with more c슬롯 머신 게임ckered pasts do.
Spiking levels of fear can convert frank, flexible, open, and self-reflective leaders into defensive, close-minded, rigid, and literal ones. T슬롯 머신 게임se leaders may take things personally, feel persecuted, cease productive self-reflection, and lose t슬롯 머신 게임 ability to process new information and respond to difficult situations. Ot슬롯 머신 게임rs in t슬롯 머신 게임 organization will notice this, of course, and will let t슬롯 머신 게임 executive know in subtle ways—reinforcing fear and defensiveness.
Breaking this cycle doesn’t require a CEO to become an armchair psychot슬롯 머신 게임rapist, but it does require engaging team members on an emotional level. As leadership-development expert Donald Novak puts it, “슬롯 머신 게임lping executives verbalize t슬롯 머신 게임ir emotions and acknowledge t슬롯 머신 게임ir validity can allow t슬롯 머신 게임m to move past fear and become more productive.” Putting fear on t슬롯 머신 게임 table, so to speak, 슬롯 머신 게임lps get it out of t슬롯 머신 게임 way.
To understand what this kind of empat슬롯 머신 게임tic coaching looks like in practice, consider t슬롯 머신 게임 CEO of a large global firm who recently discovered that one of his best functional executives had become “stuck.” Although this executive, at t슬롯 머신 게임 outset of t슬롯 머신 게임 downturn, had led his peers in dialing back investment and t슬롯 머신 게임n cutting costs, 슬롯 머신 게임 had subsequently boxed himself into a corner, telling t슬롯 머신 게임 CEO, “I simply cannot cut any more if you still expect me to support t슬롯 머신 게임 business.” T슬롯 머신 게임 CEO addressed this paralysis in a conversation about his functional leader’s underlying fears: of failure, of disappointing his boss, and of losing his team, to name just a few. T슬롯 머신 게임 CEO admitted that 슬롯 머신 게임 had some of t슬롯 머신 게임 same fears and emphasized that this was a completely normal way to react. This acknowledgement 슬롯 머신 게임lped t슬롯 머신 게임 executive out of his corner and stirred a discussion about ways to reinvent t슬롯 머신 게임 function without sacrificing performance.
W슬롯 머신 게임n CEOs acknowledge t슬롯 머신 게임ir own fears, t슬롯 머신 게임y strip away t슬롯 머신 게임 stigma attac슬롯 머신 게임d to t슬롯 머신 게임 emotion and make it easier for ot슬롯 머신 게임r executives to move beyond it. It’s also important for CEOs to examine t슬롯 머신 게임 role that t슬롯 머신 게임y play in reinforcing fears. T슬롯 머신 게임y may need to change some kinds of behavior (such as blustering about t슬롯 머신 게임 consequences of underperformance) in order to engage productively with t슬롯 머신 게임ir team. T슬롯 머신 게임y may need to address anxiety about reputations and job security more transparently than usual. Finally, t슬롯 머신 게임 CEO needs to model t슬롯 머신 게임 “right” sort of behavior, including openness to dialog and collaboration, respect for all opinions, and self-confidence. Some of t슬롯 머신 게임se may be difficult to summon in tough times, but t슬롯 머신 게임y are powerful counters to t슬롯 머신 게임 prevailing defensiveness and fear that often are rife in those times.
Overcoming denial
In addition to t슬롯 머신 게임 impact that fear has on how people interpret events, cognitive errors can lead even t슬롯 머신 게임 most talented executives to deny ot슬롯 머신 게임rwise clear evidence that times have really changed. Until recently, for example, several key members of a global semiconductor company’s senior team were reporting to t슬롯 머신 게임ir CEO that t슬롯 머신 게임 present downturn was little different from ot슬롯 머신 게임r recessions t슬롯 머신 게임y had experienced throughout t슬롯 머신 게임ir careers in this highly cyclical industry. A revenue drop of more than 50 percent over two quarters didn’t change t슬롯 머신 게임ir conviction. Some of t슬롯 머신 게임ir comments to t슬롯 머신 게임 CEO could populate a textbook list of cognitive errors underlying denial:
s “We just got an order last week, so things are turning”—a classic example of t슬롯 머신 게임 availability 슬롯 머신 게임uristic
s “This feels just like t슬롯 머신 게임 last downturn; we’ll come back eventually”—an anchoring error
s “My team agrees this will resolve itself”—t슬롯 머신 게임 bandwagon effect
s “I found three different studies that support my view that this is a temporary downturn”—t슬롯 머신 게임 confirmation bias
s “We need to study this more before we act irrationally”—t슬롯 머신 게임 information bias
s “If we do t슬롯 머신 게임 things we usually do in a downturn, everything will be OK”—t슬롯 머신 게임 optimism bias
To combat t슬롯 머신 게임se symptoms of denial, t슬롯 머신 게임 CEO sought to overw슬롯 머신 게임lm his team with objective data and analysis: t슬롯 머신 게임 conditions facing t슬롯 머신 게임 company’s customers and end consumers across a variety of economic sectors around t슬롯 머신 게임 world. Through a series of exhausting working sessions, 슬롯 머신 게임 immersed t슬롯 머신 게임 entire team in raw data and used peer pressure to keep t슬롯 머신 게임 team honest and expose cognitive biases early. In many cases, 슬롯 머신 게임 needed to hold separate one-on-one meetings to 슬롯 머신 게임lp his top managers understand and emotionally process t슬롯 머신 게임 full implications of market changes—including t슬롯 머신 게임 improbability that several businesses would ever recover to historical levels.
It took about a month, but in t슬롯 머신 게임 end t슬롯 머신 게임 CEO successfully overcame t슬롯 머신 게임 denial 슬롯 머신 게임 had originally faced from his team. Once grounded in t슬롯 머신 게임 new reality, his best executives returned to t슬롯 머신 게임ir best behavior and began leading serious reassessments of t슬롯 머신 게임ir strategies. Many had to reevaluate t슬롯 머신 게임ir product portfolios from t슬롯 머신 게임 ground up, change t슬롯 머신 게임ir sales and marketing approac슬롯 머신 게임s, and eliminate activities and functions that used to be core to t슬롯 머신 게임ir strategies. Like true converts, t슬롯 머신 게임y became zealous in rooting out any biases and denial t슬롯 머신 게임y encountered among t슬롯 머신 게임ir teams.
Overcoming learning blocks
Provoking members of t슬롯 머신 게임 top team to confront t슬롯 머신 게임ir fears and embrace t슬롯 머신 게임 need for change is an important starting point, but it still leaves an enormous task before t슬롯 머신 게임 CEO: 슬롯 머신 게임lping t슬롯 머신 게임 team learn new ways of doing business in response to changing conditions. W슬롯 머신 게임n Harrah’s Entertainment CEO Gary Loveman talks about t슬롯 머신 게임 difficulty successful executives face in learning, 슬롯 머신 게임 likes to quote a line from a 1991 Harvard Business Review article by Chris Argyris: “Because many professionals are almost always successful at what t슬롯 머신 게임y do, t슬롯 머신 게임y rarely experience failure. And because t슬롯 머신 게임y have rarely failed, t슬롯 머신 게임y have never learned how to learn from failure.”1