In this new installment of what matters in business, we focus on the leader’s mindset. The wrong CEO mindset can take a company down, but the power mindset can fuel the company for success! Let’s explore the idea of the CEO’s Mindset
Much has been written about the topic, so in my normal fashion and style, I will focus on the CEO mindset from the “PPLC” perspective. The PPLC framework was created in my book, The Rookie CEO, You Can’t Make This Stuff Up! where I discuss how 9 rookie CEOs got there and led – teaching us how their actions and behaviors can lead to success or failure. The book features behind-the-scenes true stories and events that both educate and entertain but deliver powerful messages.
For clarity of the PPLC framework:
- The first P is their Path to CEO
- The second P are the Philosophies they bring to the party
- L is their Leadership style
- C is the Company Culture as a result of their PPL
There are many books and resources specifically about the CEO Mindset. We will explore this later. These resources are excellent, however, when Mindset is considered within the PPLC framework, you can gain a deeper perspective on how your leadership mindset develops, how you can refine your mindset, when necessary, under unique situations, and what drives you to lead as the situation demands.
Path to CEO
Your path to the top from when you are growing up, how you were brought up, your schooling, sports, or other activities you participated in, and your roles along your career path, all contribute to your Mindset Foundation. Are you always on the leading edge, taking bold risks and challenging the status quo? Are you an agent of change through learning and growth? Whichever you are, this is your Foundational Mindset.
Your core values and principles drive your philosophies and set the stage for your leadership style. We all develop our personal philosophies from our Path to CEO. You might emulate your parents, former boss, influencers you respect, or teams you may have been a part of, but your philosophies are generally second nature when you get to the CEO position. Your core mindset around your philosophies is well-formed at this point and built upon your Foundational Mindset.
Although industry experts, authors, recruiters, boards of directors, investors, and executive teams classify traditional leadership styles as one of these styles: Autocratic, Bureaucratic, Democratic, Laissez-faire, Servant, Transactional, and Transformational. Several sources add Coach, Pacesetter, and Visionary styles. In my book, The Rookie CEO, You Can’t Make This Stuff Up!, I choose not to use these traditional styles as all 9 rookie CEOs featured in the book were some combination of these. My focus is based more on their behavior and the results, driven by their behavior, based on the PPLC framework.
Leadership Styles are the sum of different human elements, such as how you treat people, delegation skills, competitiveness, aggressiveness, secrecy, follower or trendsetter, visionary big-picture type, ability to not micromanage except under crisis situations, and these types of behaviors. One good example that sets back many CEOs, rookies or not, is the ability to remain calm and focused under stressful situations. These can arise from a board member calling the CEO to complain about the website, feedback from a friend or customer, or simply having a discussion with another CEO. Not remaining calm in these situations, can cause a frenzy that spins out of control if the CEO loses their temper or reacts poorly. It is the mindset that CEOs bring to the table that creates their overall day-to-day leadership styles. I will share some examples below.
In my career of over 40 years, I have learned that the highest performing companies and the best companies to work for have created a top-notch company culture. In writing my first book, I created the PPLC framework to help aspiring CEOs and CEOs who may benefit from a framework understand what drives their culture. CEO behavior drives the success and failure of the company and its culture. Some behaviors can sink the company if they cross the line. The CEO mindset drives all these leadership elements that together form their individual leadership styles.
Traditional Mindset Models
The books and articles I mentioned earlier are written by leading experts that are excellent resources. My perspective is that CEOs must be fearless, and they are peerless. If the CEO fears anything, it will show in their behavior and that can cause a lack of respect among the employees and team members. There is only one CEO per company unless the company is in the minority of “two-in-a-box” CEOs which is rare.
Traditional methods include things like being a powerful direction setter, not aligning the organization and leadership team, managing, and engaging the board of directors, and focusing on personal effectiveness while building around their strengths and weaknesses.
What drives our leaders? These are all connected to the mindsets of the CEO and why they matter.
- How they work with and communicate with clarity – mindfullness
- Being unique and self-aware
- Care about employees, customers, partners, shareholders, and the board of directors – compassion
- Prioritize “now” – everything from spending to hiring as revenues and investments support; cultural behavior
- Having the vision and BHAGs (Big Hairy Audacious Goals) for the future
- Emotional Intelligence – understand and recognize the motivation and emotions of your people and the ability to inspire them
- Critical thinking – the internal ability of the CEO to solve complex problems systematically and adapt; knowing what data to collect, how to align the team members, and how to execute to solve complex problems
- Ability to listen and learn
- Ethics and integrity
Mindset examples based on true stories
- One CEO I worked with loved creating mystery around the core technology that was branded. When launching the products, journalists and analysts would ask questions about “how” the product worked or was differentiated. The CEO’s answers were designed to keep a “mysterious” story which in turn generated more interest! The journalists and analysts couldn’t stand not knowing every detail! The CEO’s mindset was by design – to keep the technology very mysterious. This can work for external situations. Although one might call this a philosophy, it was not his philosophy for all situations – just in his go-to-market plan, and it lasted for years successfully.
- One new CEO I worked with chose to keep all business financial numbers a secret. This leader felt that if employees knew the details, they would give them to competitors. As CEO, it is your responsibility to know each number that comprises the business from revenue to headcount, to any metrics that measure performance. To hide these numbers from employees, senior leadership teams, and boards of directors is considered secretive behavior and mindset. In my experience, most of the senior leaders and employees do not appreciate this secrecy as they want to know how they impact the business. This mindset example leads to dissatisfied and disloyal employees.
- One rookie CEO I worked for hired over 20 senior leaders from his previous company within a year or two. This was his success model and mindset to bring his trusted team from a previous company without regard for who had built the company he was hired into. This was a mindset that changed everything from decision processes to company culture. The success of this mindset is in the business results over time but can lead to other employees leaving. This is also a common mindset in the tech industry.
- Newly hired CEOs that are replacing an outgoing CEO may decide before they start that they will replace the existing senior staff. There is no regard for the people in those key positions, they simply hire over them. I have been on both sides; I have been hired over the existing team and I have been the new hire that is replacing or senior to the existing team members. I have experienced both sides. This is a CEO mindset that sets the tone for their tenure. These actions shape the business and lives of everyone from the affected executives to the employees downstream.
- One CEO I worked for maintained control of the pricing approvals of all sales deals in the company over a certain set amount. The CEO’s mindset of pricing control was a process he would never let go of because the sales team would ‘buy’ the deal with discounts or free services, while the product team was fighting for, and bonuses based on margin contribution. The CEO would not miss or delegate a pricing meeting, even if he and his family were on vacation or traveling internationally. I can recall meetings that he called from his hotel coat closet at 4 am so he would not wake up his family – he had to have final approval. His mindset never changed in his 30+ years of being a CEO. It was a topic of conversation throughout the company throughout the year and the pricing meeting became a “family” type of meeting.
In this part of the “Matters Series” that discusses Mindset Matters we have discussed traditional perspectives about CEO Mindsets, and I placed them into my PPLC framework as well as shared a few examples. Every CEO has a unique background and path to CEO which develops their Foundational Mindset, they bring their own philosophies to the role which is based on their experiences and foundation, and these together bring their leadership styles to the forefront in the day-to-day running of their company. CEO Mindsets are developed individually by each CEO and contribute to how they drive the results of the company.
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