Posted by: Jim | December 21, 2006

The CEO President

George W. Bush is a self-styled “CEO President.” I will confess that Ross Perot once put the thought in my head that this was a good idea; run the country like a business. A good company has a positive cash-flow. Well, economically there is some sense to this, but from a leadership style standpoint, it is very very bad–at least when compared to American CEOs. As a long-standing member of corporate management, I’m no stranger to how CEO’s work. While I’m not seeing this at my current company (my current CEO is a smart, decent guy), I would like to point out what bad CEOs are very good at doing:1. Squelch dissent.

Bad CEOs do not ever allow dissenting opinions to co-exist with their own. There are many reasons for this. Namely, they may point out a flaw in the CEO’s strategy. The more insecure CEO doesn’t allow dissent because he or she feels it may threaten their leadership. The CEO’s plan must be perceived as the only real (and, by the way, brilliant) strategy.

2. Know that perception is everything.

CEOs are well aware of the huge gap between perception and reality, but take advantage of a flaw among followers who don’t see this gap. The CEO must appear perfect at all times, without blemish or flaw. They never admit to being wrong.

3. Lead with sound bytes.

Bad CEOs think their followers are stupid, and won’t understand the complexities of their strategy. They wrap their corporate statements up in very simple sound bytes that even a child could understand. The sound byte is often meaningless fluff, but is a nifty concept that no one could disagree with. Bad CEOs create sound bytes like “Building a Better 2007,” or “Individual Empowerment,” or “A Way Forward.”

4. Frame the argument.

One tactic for leading an organization through change is to frame the argument (often with a sound byte) so that it is impossible for people to disagree with. “Down-sizing” is reframed as “Right-sizing.” “Off-shoring” is reframed as “risk distribution.” “Nation building” is reframed as “Freedom on the march.”

5. Do A Lot More With A Lot Less.

There is a point where this works. Organizations can often “trim the fat” and get the same job done with fewer people. Hire some smart managers who can create efficiencies, and the company can save a lot of money. However, CEOs who are out of touch will trim the meat and continue to expect the same outcome over and over again. They see people as commodities, and forget that they can become stressed out and less effective. While this will create simple burn-and-churn at the workplace, it creates trauma and death in a war.

6. Create a short-run strategy.

This is a great one. CEOs are often incented for short-term profits. A CEO might have a five-year contract, with bonus incentives for meeting certain financial benchmarks. Usually it’s the stock value. Stock value is easy to manipulate for the short term. Methods vary depending on the industry, but production output can always be increased for awhile. Costs can always be cut for awhile. Market share can be increased for awhile. Market perception can be maintained for awhile. Inspiration can work for awhile. Any lousy CEO can build a perception of an organization that will increase the stock value in the short run. President’s have a four-year contract that is renewable once. This may be why every two-term president begins to falter during his 6th year in office (check it out–it’s amazingly consistent). If you’ll notice, the average tenure of a CEO in America has also decreased dramatically over the past 10 years.  Why? Because it takes a great deal of skill to be a good leader over a long period of time.

7. Invent your own reality.

Bad CEOs can drum up evidence to support their own theories. They can imagine that a certain vendor is the only one who can deliver. They can brush off evidence that their marketing push is not working. They can make everyone believe that aluminum tubes meant for SCUD missles are actually meant for the construction of WMDs.

 Let’s get the notion out of our heads that a “CEO President” is a good thing. It is not.

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Responses

  1. Absolutely, Jim. I hate the phrase. It really fits with that definition of fascism as corporate government. The project becomes the endless defence of policy from all criticism, rather than an open debate on what is best for America. A really irksome part of this is the corporate media compliance. For instance, it is a matter of the record that Bush is now using language to describe the situation in Iraq, and advocating policy, that were advanced earlier by his critics. They were rubbished then by Bush, now they are reported uncritically without Bush’s inconsistencies being raised.

  2. Not sure I am tracking…maybe it would help if I read the article twice. Being impatient I likely will not.

    My take is the article discusses some positive traits or things not to do that will create a better CEO. The article ends with,

    “Let’s get the notion out of our heads that a “CEO President” is a good thing. It is not.”

    If our President is not to be a CEO than I am confused as to what he should be. I would think we would want our President to model the characteristics of a ‘good’ CEO and lead our country.


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