According to shared highlights from a two-day peer-to-peer session for senior business leaders, the “Bower Forum” conducted by McKinsey, two principal challenges are facing many CEOs: how to manage their early transition into the top job, and how to keep up with fast-moving technology to better prepare themselves for the disruption that will more than likely confront their companies.
Those two themes consistently cropped up in conversations, reflecting the two preoccupations delegates at earlier Bower Forums have been most anxious to talk about. McKinsey invited Bower alumni from companies across Asia, Europe, and North America to a special event in Dubai. Much of the wide-ranging discussion was off the record, but participants have allowed shared highlights of those exchanges.
Many CEOs describe the experience of becoming CEO as a life-changing event, says the report, and conversations demonstrated how diverse that experience can be. Take the first 100 days, says the report, that vital early period in a leader’s tenure about which there are many myths in corporate life. A number of experienced CEOs expressed sympathy for the idea of an early burst. “Quick wins and some fresh insight are very important in the first three months,” said one. “The markets are not going to allow you to go into a room for the first 100 days.”
TheForum members also emphasized the importance of “biting the bullet” with the management team, when needed, if not during the first 100 days, then certainly during the first year of a leadership transition. Every leader, says the report, faces a conflict between the need for change and the need for stability, a challenge he (or she) addresses by recruiting new members of the top team principally from within.
McKinsey research suggests that bold action during the early years of a CEO’s tenure boosts the odds of strong corporate performance but does not put a specific time frame on that action, which is context specific, as will be the relative importance of reflection versus immediate action. Only by first understanding the uniqueness of his or her situation can a new leader decide on the course of action that makes most sense.
One thing participants did agree on was that new CEOs are under a microscope, whether they are taking bold action or listening and learning. In the words of one Forum member, “In the first 100 days, there are people watching you intently, trying to figure out what’s going on and reading into the situation things that don’t exist. But you have to cut through that by sometimes showing your vulnerability, your humanity, and your willingness to connect. You have to “over communicate,” says the report.
Many Forum members were convinced that technological change is the biggest, most disruptive force facing today’s corporations. One cited the development of aluminum doors, hoods, and fenders in the automotive industry (half the weight of steel but with the same crash impact). Another pointed to the growth of computing power, which has allowed one company to model highly complex and dynamic systems in real time, thereby moving from the drawing stage to testing a full-scale, fully operational prototype in less than three months, and concluding, “there is now no gap between research and development.” A Forum participant also remarked on the potential impact of developing battery technology, which could make solar power competitive with fossil fuels and create distributed energy systems that can be independent of the grid.
But technology isn’t changing only corporations—it’s also changing the job of the CEO, bringing with it the challenge of keeping up with technological development. “It’s actually not that hard to stay well-informed these days,” one Asian CEO commented as he and others listed blogs, magazines, research reports, the top team, consultants, customers, and staff among multiple sources of potentially valuable intelligence. “What’s much harder for a leader is deciding what’s relevant and what’s not.” For that, he suggested, you have to be “clear about your priorities” and able to decide instantly whether or not it’s worth spending time to digest, explore, and understand new information. “If you don’t [prioritize], you’ll sit in your office all day, read lots of reports, and end up being completely confused.”
In summary, says the report, it’s not every day that 75 CEOs and board chairs get together for two days of reflection. Self-awareness and introspection were core to the Bower Forum anniversary meeting. While the issues discussed by participants are hardly unique to this group, the seniority and global diversity of the group make their deliberations worth heeding.
For additional information about these sessions and the ensuing report, please visit here.