I’ve certainly seen this situation again and again over the years: the person leading, who may have been effective in the
past, stops being effective. And not for just a few months: for years and
years. And the board doesn’t step in to make a change. And I’ve thought – why
does this happen? Do they not see it? Do they not care?
It comes down to three (3) unfortunate truths about boards, as far as I
can tell:
- Like protects like: People on boards are, often,
Department Directors, CEOs or ex-CEOs or in positions of management themselves. Board members want to support
and protect CEOs because 1) they wouldn’t want their boards/bosses to fire them
if they were in a similar situation, and 2) they like to think that their peers
and buddies are doing a good job – even when they’re not.
- Hope Springs Eternal:
When somebody used to be doing a good job, it’s easy for board members to
convince themselves that he’ll start doing a good job again…just wait and see. After all they possibly interviewed him and selected him so how can they not be successfully.
- Stick to the Tried and True: They’ve been board members for 20 or 30 years, and
they believe that the things they did successfully in
1970 or 1980 are still the right things to do. They watch their CEOs doing
stuff that worked a decade or two ago, and they think, “Well, it will work
eventually; he’s doing the things that work.” It’s simply not true.
The game has changed, permanently – and will keep changing. Most industries are undergoing massive, disruptive, continuous change: consumer
behavior and expectations; how the product delivery channel works; what drives pricing; how
and where competitive threats arise – even employee expectations and response.
If a CEO isn’t willing to get curious and give up some of their old ways and try truly fresh
approaches…well, you know what happens. You will wither on the vine and die!
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