Seven Proven Ways to Executive Failure…

Posted by Kelley LearcloseAuthor: Kelley Lear Name: Kelley Lear
Email: kelley.lear@redmoonsolutions.com
Site: http://blog.redmoonsolutions.com
About: Kelley is a member of the executive leadership team and leads our sales and marketing efforts at Red Moon Solutions. Kelley’s extensive experience in project management, product management, and consulting with Fortune 500 and Global 1000 clients is extremely important in this role.See Authors Posts (127) on Jan 10, 2012 | 0 comments

Just read a great article on Forbes.com titled “The Seven Habits of Spectacularly Unsuccessful Executives”, written by Eric Jackson.  I am always reading about the “secrets of success” and the “how to’s” on every topic in executive leadership, but not many share the definitive ways that executives can fail.  I kind of like to think about the flip side.  In this article, Eric also uses some research also touched on by Sydney Finkelstein and Steven Roth who published “Why Smart Executives Fail”, which included over 50 former company senior executive profiles from companies like Enron, WorldCom, Rubbermaid, and Schwinn.  Interestingly enough, their research found seven habits that all these senior executives had in common, and which the authors assert are the key indicators for failure. 

Eric also takes these same seven “habits” or traits and draws a line to some more recent “failures” or more importantly, as “warning indicators” for struggling companies and their current executive leadership…these are companies like Amazon and RIMM – Research in Motion (yes, my Crackberry brethren).  I thought I’d share them here, with some of my interpretation of their thinking:

Habit #1:  They see themselves and their companies as “dominating their environment”, but do not also realize that they are at the mercy of a changing environment and that they cannot control all variables. 

Habit #2:  They do not separate personal and corporate interests and actually maintain a “private empire mentality” instead of one that understands that each enterprise is an entity that needs to be nurtured and separate.

Habit #3: They think they have all the answers.  You have met a few of these out there, I am sure.  I know I have. Those that come up with solutions to hard core problems in a matter of seconds, and who can sift through problems quickly and efficiently.  Although many people look upon brilliant executives with admiration and perhaps a bit of awe…an executive who always thinks they have the answer, can be a hindrance when they don’t look to others for differing perspectives and completely out of the box thinking.      

Habit #4:  They ruthlessly eliminate anyone who isn’t behind them one hundred percent.  A team will always get to a better result more often than one point of view in a vacuum.  One of my favorite old CEO stories was one in which one spectacularly successful CEO said, “If I always have two people in the room with me that always agree with me, I have two too many people in the room.”

Habit #5:  They are consummate spokespersons, forever obsessed with company image.  This also manifests itself into corporate reporting and controls, which are often used for public relations instead of financial accounts truly being a “control tool”. 

Habit #6:  They underestimate obstacles.  Due to high level thinking of most CEO’s and other senior executives, they can be fantastic visionaries, but may underestimate the details and the way things would need to be implemented to achieve those visions. 

Habit #7:  They stubbornly rely on what worked for them in the past.  This is where the CEO actually clings to the business model or core strengths they believe the company has, but assumes that those are still true in an ever changing, rapidly evolving market.   Sticking to your knitting is a great approach under the right circumstances…but, perhaps they need to consider that the market has completely changed and/or that innovations are needed to bring the company forward into a new era.

For me, I think “Habit #3” is the most significant.  Pair this with a complete lack of listening skills and I believe you truly have a recipe for disaster.  I am sure you have met these folks out there as well.  They are finishing your sentence before you have time to push it out over your lips.  They are interrupting your thoughts regularly or even worse, just not asking your opinion at all.  No one has all the answers.  We need to listen carefully to each other and take in different points of view.  Learn from experiences, mistakes, and yes…even successes.  What do you think?  What do you think are the fatal flaws in executive leadership?