The CEO Focus on People Is Here to Stay

A recent study by the Harvard Business Review (HBR) warns that “companies can no longer assume that leaders with traditional managerial pedigrees will succeed in the C-suite.” This finding spells trouble for boards and investors who don’t look beyond conventional leadership measures and more closely at modern communication skills when hiring a CEO or assessing the current performance of one.

For example, CEO Today says that chief executives who didn’t communicate openly during the pandemic made a critical leadership mistake that left employees “without a sense of direction,” the very thing most needed during a crisis. Similarly, Under30CEO ranked Not Listening to Others and Losing Touch with Employees as two of the most common mistakes made by first-time CEOs.

This underscores the vital need for two-way communication between CEOs and their various stakeholders. Today’s chief executives can’t issue edicts from the corporate ivory tower and expect success. Instead, they must effectively collaborate, influence, and engage with people across a broad spectrum of organizational levels and from diverse backgrounds, and do so in three highly visible ways.

CEOs as Chief Relationship Managers

The modern CEO focus extends well beyond financial and operational responsibilities. As HBR notes, CEOs “have to spend a significant amount of time interacting with others and enabling coordination—by communicating information, facilitating the exchange of ideas, building and overseeing teams, and identifying and solving problems.”

Essentially, a CEO must also be the chief relationship manager of the business, the one ultimately responsible for building and maintaining strong partnerships (or repairing damaged ones) with a wide range of internal and external constituencies as demonstrated by this extensive list:

  • The Board of Directors: A body that often includes a range of leadership styles and philosophies with members potentially hailing from various industries and areas of expertise.
  • Employees: From C-suite direct reports to middle management and rank-and-file staff who collectively represent the foundation of the business.
  • Customers: Another core constituency that can represent various age groups and geographic locations for B2C companies and multiple business sizes and industries for B2B companies.
  • Partners: Vendors and third-party contractors who provide critical products and services needed to operate the business.
  • Market Allies: Non-competing companies that target the same customer base and represent potential collaboration opportunities to increase market share.
  • Direct Investors: Private equity firms, venture capitalists, or public shareholders who inject the capital needed to grow.
  • Market analysts: The pundits who are as likely to publicly criticize a business as to praise it.
  • The general public: Everyone from potential customers to social activists or even protesters who today can quickly form and easily share their opinions about any business.

CEOs as Chief Social Media Influencers

The increasing prevalence of social media provides CEOs with one of the most versatile communication forums ever available to them. With it, company leaders can quickly and easily reach and influence the opinions and actions of their internal and external constituencies. Moreover, social media breaks through the one-way nature of traditional corporate communications so that all stakeholders can easily respond to CEO social posts and even amplify them among their own networks.

On the other hand, a CEO social media gaff that goes viral for the wrong reasons can cause serious backlash. But boards and investors need to understand that the solution isn’t a CEO who avoids social media. It’s a leader who understands the power of social media and has the skills to effectively capitalize on it for the organization’s sake.

Brunswick Group research even shows that employees prefer to work for CEOs who use social media by a 4 to 1 margin. The global advisory firm also indicates that an authentic, trusted online CEO presence helps advance and achieve business goals because of the benefits it yields to company leaders:

  • The ability to share messages directly to a global audience in real-time
  • The chance to be transparent with employees and inspire them
  • The opportunity to “break out of the CEO bubble” and “gain unfiltered insight”
  • The means to proactively establish trust, instead of trying to do so in a crisis

CEOs as Chief Employee Engagers

In 2021, public relations giant Edelman surveyed over 250 senior communicators about the future of corporate communications and found that “an increased focus on the workplace, workforce, and well-being of employees isn’t a pandemic fad.”

Michael Garrity, CEO of Financelt, named one of Canada’s Most Admired Corporate Cultures of 2021, expressed a similar sentiment in an interview with CEO World. “Global engagement scores have been trending downwards for many years.” Although some blame COVID-19 for the Great Resignation, “It may be more accurate to say that the global pandemic was the final straw,” he says.

While organizations struggle to effectively engage their employees, there is also a growing emphasis on diversity, equity, and inclusion, which addresses critical issues related to employee well-being. In this environment, empathy has become one of the most critical CEO skills. According to Garrity, empathetic leaders are the ones who engage employees using three distinctive tactics:

  • They lead with genuine questions that ask individual employees how they are doing.
  • They exhibit patience and gently dig a little deeper when employees are reluctant to share.
  • They ask what the organization can do to make things easier once employees share their challenges.

It’s Time to Pay Attention to this New CEO Focus

Not that long ago, the ability to effectively communicate with people was considered a soft leadership skill for CEOs. It took a definite back seat to operational prowess and mainly focused on the relations with the board, the C-suite, and investors.

Today, online echo chambers amplify a CEO’s words to everyone within the organization and people anywhere in the world, making their words more powerful than ever. CEO stakeholder interactions are now a key difference between brand exceptionalism and mediocrity or even organizational survival and failure. This explains the high demand for CEOs who can skillfully communicate no matter the intended audience, the intensity of the situation, or the medium used to convey their message.

By Adam Charlson, Managing Partner and Co-Leader at Focus Search Partners

Need help hiring a CEO who possesses all the right skills, including the ability to effectively collaborate, influence, and engage with people in every stakeholder group? Contact Focus Search Partners today.

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