6 Critical Areas for Evaluating Your CEO
Apr 15, 2024
What do the great Chief Executive Officers and Executive Directors do? What sets them apart? How can you incorporate exemplary mindsets, approaches and practices into your annual assessment? Here are six areas to consider.
Two years ago, McKinsey senior partners Carolyn Dewar, Scott Keller, and Vikram Malhotra launched CEO Excellence: The Six Mindsets That Distinguish the Best Leaders from the Rest (Scribner/Simon & Schuster), a New York Times best-selling book that revealed the characteristics of the most successful leaders. The authors studied nearly 8,000 CEOs across the globe and across various sectors to determine what set these leaders apart from the rest. Through detailed interviews with 67 successful CEOs, they uncovered the mindsets, approaches, and practices that informed their leadership styles and delivered powerful results.
Yes, these are for-profit Chief Executive Officers, but in my experience, the characteristics are quite similar. Indeed, as we have often pointed out, the main difference between for-profit and not-for-profit organizations is the critical shift from “for-bottom-line-profit” to “for-mission-accomplishment.”
The researchers wanted to clarify, “What is the role of a CEO? “ Most importantly, they wanted to answer, “What separates the best from the rest?”
What did they find?
“What is the role of a CEO?” They are now clear on what that is. The irreducible core of the role consists of six things that they will need to do:
1. Set the direction;
2. Align the organization on that direction;
3. Mobilize their leaders to deliver on that direction;
4. Work with the board;
5. Connect with a group of stakeholders; and
6. Manage their personal effectiveness.
Let’s take these one at a time and add the lens of the not-for-profit board.
Theoretically (and indeed in practice), it is the Board that sets the direction for the organization. But it is typically the Chief Executive Officer or Executive Director who orchestrates the process as the Board’s agent. It is also the CEO who brings that senior staff (and often the Board itself) into the process. So who does your CEO manage the development of the strategic plan with the Board.
How does that strategic plan translate into operational and business plans? How are the “bright and shiny” objects, the nice-to-do-but-not-exactly-mission-specific” sidelines set aside to ensure a laser-like focus on the direction and plan? What changes have taken place as a result of your plan?
The strategic plan needs to have responsibilities assigned to specific individuals with intended outcomes and deadlines. Coaching if necessary and accountability for sure need to be reflected in the work of the senior team. Plans, priorities, reviews, support and pressure ensure that everyone is moving forward, in alignment. What are some of the questions that you ask and discuss?
The Board too needs to align, lead and be accountable. One of the easiest ways to do this is to have each timed item from your plan set as a priority on the agenda for that month, with a written report. Be accountable. Perhaps assign a Board member to each strategic direction, paired with a senior staff leader.
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Our studies suggest that the CEO or Executive Director spends about one-third of their time in operations, one-third on the board and one-third in the community with stakeholders and developing partnerships. How do you assess community and government work? How do you collect data that is more evidentiary than gossip and innuendo?
One of the best rules of time management for any leader is to assess whatever only they can do. And then, of course, their capabilities. There is no greater waste or organization capacity than having leaders do the work that could easily be done by others. This is personal effectiveness within the bounds of their role.
Six critical areas. Six areas of responsibility. Six approaches and mindsets.
How do you assess these? How do you engage in reviews that extend beyond work with the Board (one-third of the job) and rely on more than self-reporting or on more than gossip and innuendo from staff and community members?
What are your main “pain points” dealing with evaluating your Chief Executive Officer or Executive Director?
What advice would be most helpful to you?
And we always assume that you are asking for a friend!
Get in touch. We’ll address your questions and concerns in an upcoming blog post.
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