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Destructive Leadership Practices: Is Your CEO in Denial?

The following is a Best of 360Connext post

We have a saying around here.

We only work with “enlightened leaders.”

I started saying that after a particularly challenging consulting exercise. I was working with a growing technology company. They had a lot of great things going for them. New revenue, lots of press and attention and a very successful new product rollout had all happened just before we worked together.

Employee Turnover, meet Churn Rate.

It turns out, their employee turnover rate was becoming startling. They couldn’t keep their talent. What’s more, they started realizing that while they excelled at acquiring new customers, they weren’t great at keeping them. This company had been the industry disrupter. But now there were new startups squeezing into their space, taking their customers and attracting the kind of buzz reserved only for the new and shiny players.

After interviewing current and former customers, I identified a pattern. Customers LOVED the attention they received as new customers. Then it tapered off, they felt less connected and important, and they drifted to my client’s competitors.

Workplace Psychology

How vital employee feedback gets filed under “G”

When interviewing and observing the staff, they shared things they didn’t feel they could say in the monthly “all hands” staff meetings. They revealed a belief that the CEO/Founder was inflexible and demanding. They were too fearful to tell the truth about feeling overworked and under appreciated. Every new employee learned the secret code of “don’t ever offend the CEO” which also meant never critiquing his original work. This included the design of the logo (it was awful) and the user experience of the very product they were selling. It was clunky and outdated, but the founder was too emotionally attached to recognize it needed an overhaul.

leadership practices

Let’s take this to your leader.

So after a detailed analysis of the user experience of the products, I compared this experience to the competitors. The comparison was pretty shocking. And this company was going to lose their footing quickly if they didn’t make some changes.

The founder, in all his wisdom, was anxious to get the results of our 4-month evaluation. The day I presented the findings changed how I do business. And here’s why.

It was a room of 12 people, with the founder sitting at the end of a big conference table. The others were his senior staff, his trusted leadership team members. Some of them, unbeknownst to Mr. CEO, were the very people who had confided in me about their fears of being honest. They smiled at me as if to say “you can do this. Tell him what it’s really like!”

I walked through our findings, including the hard truth that there was a perception that honesty was not valued within the walls of the company. This led to stagnant thinking instead of innovation. Innovation only comes with risk. Risk was not rewarded.

I also discussed the way the competitors and other industries were creating customer loyalty based on better user experiences. Our digital evaluation scoring ranked our client as dead last compared to the competitors. On a scale from one to five, they had received a 2.1. Ouch.

leadership practices

It wasn’t easy to present these difficult truths to the people who had worked so hard and invested so much. It was not easy to look at Mr. CEO and tell him that his baby wasn’t perfect.

But he nodded along. He seemed to be taking it all in. The others in the room were sitting up straighter, glancing back at him to gauge his reaction, and smiling at me as if to urge me along on this difficult path.

I checked in for reactions. The marketing director, a very smart woman who was frustrated by the lack of changes, spoke up and confirmed what the others had said. “There is not enough emphasis on staying ahead here. We treat our product and company as if it’s a static thing that will always work the way it did in the past. We need to really consider what this tells us.”

The room felt electric. The group was with her, nodding and leaning in. They wanted this.

leadership practices

 You have the power! What will you do with it?

Finally,  Mr. CEO spoke up for the first time. He said he disagreed with the marketing director.

And the room deflated. I watched as each set of shoulders fell. Smiles disappeared. They knew what was coming.

Mr. CEO declared our evaluations were bunk. They didn’t matter. He had been in business a long time. He knew how to be successful. He had built this company from nothing.

Criticism of the user experience had been too much for him to hear. After all, he had developed it and nurtured it and customers DID like it. What about Mr. Happy Customer? The one who goes to lunch with Mr. CEO and raves about his products?

I realized the work we had done WAS meaningless. It would mean nothing if the leader wasn’t willing to change.

So Mr. CEO asked the CFO to be sure they had paid our final invoice, thanked me for my time, and left the room. And the others, sheepishly, painfully, came to thank me and shrug their shoulders as if to say “what can we do?”

leadership practices

CXI® means re-evaluating your leadership practices.

I felt defeated. I left feeling awful. We care deeply about our work and want it to matter. But I quickly realized my mistake was working with a leader who was unwilling to hear the painful truth. He was not enlightened. He was defensive, ego-driven and stuck in the past.

I wasn’t terribly surprised to hear from the marketing director a few months later, when she was at a different company. She asked me to come in and help there, which we did. She had already changed things for the better there, thanks to a very supportive CEO.

And I wasn’t terribly surprised when LinkedIn told me Mr. CEO had to close the doors on that company. It saddened me, but I wasn’t terribly surprised.

Seriously, take one for the team or they will lose.

Only enlightened leaders understand what leaders like Mr. CEO don’t. It’s impossible for us to see the outside-in perspective. We need help to do so. We need to check our defenses and ego at the door and hear the truth, even when it feels like a punch to the gut. We need to help the other leaders lead in the best ways they can.

After some time and reflection, I realized Mr. CEO had granted me a gift. I want our work to matter. The only way that happens is if we work with the right people.

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