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