Leading The Way

Failure: A failing to do or perform; a state of inability to perform a normal function adequately; lack of success; deficiency

Coach/ing: to instruct; direct; a private tutor; one who trains

Special Guest Contributor: Dr. Ray Williams

During the last decade, one-third of CEOs in the Fortune 500 have lasted less than three years. Top-executive failure rates are estimated as high as 75% and are rarely less than 30%.

A McKinsey study found that the pipeline for future leaders is broken. Only 3% of those responding to McKinsey’s survey felt that their company developed leaders well.

On a global average, CEOs are now lasting an average of 7.6 years—down from 9.5 years in l995. According to Harvard Business Review (Jan. 05), 2 out of 5 new CEOs fail in their first 18 months: “We live in a world where organizational failure is endemic,” says Jena McGregor in her article “Fast Company” (Feb. 2005).

Why is this happening?

The gaps between what we see and what others see about us are known as blind spots. For leaders, blind spots can be career-limiting. The wider the gap, the more resistance there is to change.

If such a climate exists, it’s difficult to create a positive organizational culture, where openness and honesty are encouraged. Yet, candid and constructive feedback can help a leader grow. Research studies show that when someone assumes a new or different leadership role, he or she has a 40% chance of demonstrating disappointing performance. Research also shows that 82% of newly appointed leaders de-rail because they fail to build partnerships and teamwork with subordinates and peers.

There are other reasons why we have a leadership crisis.

Why have some very smart executives failed in recent times, bringing down whole companies, costing billions of dollars, and causing incredible losses to shareholders, customers, and employees?

While the corporate cultures of failed businesses vary widely, there are visible patterns of similarity across CEOs.

Sydney Finkelstein, author of Why Smart Executives Fail (2003), researched several spectacular CEO failures and their causes over a six-year period. He concluded that CEOs have the following similar deadly habits.

Habit 1:	They see themselves and their companies as dominating their business environment.
Warning sign:	*They show a lack of respect for others.*

Habit 2:	They identify too closely with the company, losing the boundary between personal and corporate interests.
Warning sign:	*They define themselves by their job.*

Habit 3:	They think they have all the right answers.
Warning sign:	*They are leaders without followers*

Habit 4:	They ruthlessly eliminate anyone who isn’t completely behind them.
Warning sign:	*There are a lot of staff departures.*

Habit 5:	They are obsessive spokespersons, obsessed with their photos, speeches, appearances, and publications representing the company image.
Warning sign:	*There is blatant media attention-seeking.*

Habit 6:	They underestimate obstacles.
Warning sign:	*They show excessive hype and little substance.*

Habit 7:	They stubbornly rely on what worked for them in the past.
Warning sign:	*They constantly refer to what worked in the past.*

There are no universal ways to prevent failures, except perhaps by being alert for the warning signs. If you’re a CEO, here’s how to avoid failure.

We live in a celebrity culture where leaders and especially CEOs are expected to be perfect examples—larger than life.

People can be great leaders and also fallible human beings. We don’t like to admit leaders have flaws. We crave a heroic leader to whom we can look up and derive a sense of safety and security. If leaders can’t admit their flaws and we refuse to see them as they really are, we contribute to their heroic myth.

Leaders can only be as effective as the degree to which they motivate and inspire others to achieve desired results.

Good executive coaches can help leaders reduce or eliminate their blind spots, be open to constructive feedback, and improve their place in the organizational culture.

Good executive coaches can reduce the likelihood of executive failure and premature burnout.

Dr. Ray Williams is Executive Vice President of PCMG Canada, a premier career management company based in Vancouver, BC. Ray recently attended CRG training and is now a CRG Licensed Associate. He has more than 30 years’ experience as a CEO, HR Executive, mediator, management consultant, and executive coach.

rwilliams@pcmgcanada.com
www.pcmgexecutive.com