Are many CEOs out of touch with what’s happening on the ground in their companies?


flying-blind-movie-poster- 190You don’t need a very large organization for the CEO to be several levels removed from the people who have day-to-day interactions with customers, and with those customers. And even in small companies the CEO and other senior executives may be hearing the good news that people think they want to hear, not the sometimes uncomfortable truth.

And so, for example, 89% of customers say that a bad experience with a brand would cause them to switch, but only 49% of executives said they thought that would be the case.

Very few large company CEOs are on social media, so they are not participating in, or even aware of, the conversation happening around their industry and brand every day.

And even within their organization, senior executives may not be getting an accurate view of what’s going on. Seven-two percent of top executives think that there is strong or complete alignment between sales and marketing in their companies, but only 51% of marketing teams see it that way (slide 5).

Over the past few years I’ve talked to people in a mid-market company that has a seriously deficient online presence. The people, some even in moderately high positions, talk with great passion about their problems in this area and how badly they’re being beaten by the competition. But no one will tell it to the CEO. One person flat out put it, “There is no organizational upside here to me bearing that news.”

Some companies have boards that may challenge the CEO, in other cases the boards are more like rubber stamps, but in either case they may not have any more information about what’s going on at the lowest levels of the company than the executives. In “1776”, David McCullough describes a case of good listening skills and leadership — how open George Washington was to input from others and his “board”. During the long Siege of Boston, at one point he proposed that they openly attack the British. His war council, though, overruled him, he accepted their judgment and didn’t attack. It took seven more months, and the movement through the winter of 60 tons of cannon captured from Fort Ticonderoga to Dorchester Heights, to get the British to leave Boston.

Even smaller companies can have communication problems

While I have worked with some of the largest companies in the world, I have worked at companies with less than 100 employees – companies that pride themselves on open communication. And for a dozen years I ran a small company before selling it in 2009. It was quite a shock to go from being the president of that company to being a senior employee in a couple other companies and hearing the difference between what people said when the owners were in the room and when they were out. (In a sense I was an undercover CEO.) In retrospect, no doubt that was also the case at my company when I was president, too.

Now, having been a president, I also know that senior executives in general, and the CEO in particular, have a lot going on. The CEO is getting input and ideas all day long. And sometimes he (and most are he) has to ignore a lot of ideas that would be good in another context to keep the company focused on a longer-term plan. But ignoring ideas that are off-plan is very different from not hearing – and possibly not even being open to hearing — bad news about the plan that’s being pursued.

(Just the fact that the ranks of CEOs and other senior executives are heavily male may be part of the problem. Men tend to be overly confident, women not confident enough – despite lots of evidence that companies with greater female leadership tend to perform better than those with mostly men at the helm — and that may lead male executives to be less interested in the input of others. And some would say that men aren’t as good at listening in general.)

Having an open door, managing by walking about, going out after work for beers with the team – none of those will matter to some people. They simply aren’t going to deliver bad news to the person who signs their check.

And some CEOs frankly aren’t very good listeners: they are far more likely to talk and dominate a meeting than to listen. And, as many people have observed, when you’re talking you’re not learning anything. The best CEOs, though, are also chief listening officers.

Programs to facilitate listening and communication

Net Promoter Score programs can be useful in giving a numerical value to the customer’s feelings. Some companies are turning the focus of their Voice of the Customer programs around to create Voice of the Employee programs. Online surveys, suggestion boxes and “how are you feeling” apps may work at some companies. Some companies have had good success in having third-party consultants come in in person to find out how employees feel and where they think things are and aren’t working. Checking out the anonymous comments on Glassdoor, and especially how they are changing over time, can be useful, too.

Employee engagement programs of many types can also help in gathering information and increasing retention. Communication from employees can take two forms: quantitative and qualitative. On the quantitative side, as with anything these days, you need to develop metrics such as rate of retention.

But no matter how happy the employees are, if they aren’t communicating accurate information the company is, in essence, flying blind. It’s up to the CEO to create that listening culture.

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