I love working with new CEOs because the learning curve from Director, VP, EVP or Chief of a function to Chief Executive is generally a steep one. And at the same time, new CEOs have an amazing opportunity in front of them to develop and grow their company and themselves in this new role.
After working with new executives over the past many years, I've seen five common challenges they face, and also learned practical solutions to help mitigate these pitfalls.
Challenge #1: Overseeing former peers
This is especially common with leaders who are promoted from within. All of a sudden, your role has changed and the dynamic between you and your former peers has shifted with a power differential. There may also be awkward dynamics with others who vied for the role you now assume.
Addressing these tension points early on through empathy and relationship building is critical, and getting these folks on your team right away will benefit you. To do this, consider meeting with them and addressing the elephant in the room with graciousness and empathy, so your relationship can move past the change and into the future of where you both want to go.
Challenge #2: Feeling scattered and overwhelmed by the volume of priorities
I hear this all the time from new CEOs, “I have NO time and am TOO busy.” Can you relate?
There’s no shortage of work when it comes to a new CEO. Getting up to speed on the complexities of the business, building relationships with individuals on the team, driving needed changes, hiring new team members, and meeting with external partners and stakeholders, the new CEO’s to-do list is full of priorities and it's hard to know which one of these is the most important.
Rather than trying to do everything at once, get better at identifying the real priorities (the Eisenhower Urgent/Important Framework is a good place to start) and reframe your time as the most valuable asset you have. Figure out what your highest value activities are and only do those things. Everything else should be delegated to others.
Challenge #3: Aligning employees around a new vision
Coming in as a new CEO to an organization that is scattered, siloed, or lacking in accountability is a tough [and common] reality and takes a steady and consistent hand to wrangle.
Talk about this reality with your leadership team and make sure they agree this is an issue that needs to be changed (you'll need them as your champions and role models to successfully align the org). Then move to clarifying roles and expectations, defining the vision and ensuring everyone understands this vision and their role to make it happen, and building accountability structures embedded in culture and process to drive the behaviors you seek.
Challenge #4: Balancing the pace and roll out of change
It’s not uncommon for new leaders to come in to an organization and identify all the ways they want to make changes, and then execute these changes quickly. This is a slippery slope though, and with too much change too quickly, a new CEO is at risk of failed change initiatives whereby people drag their feet, don't get on board, or worse, undermind the new changes. It’s important here to consider the priorities and timing of change initiatives, especially in the context of human psychology, since we know that a large percentage of people don’t actually want to change. A 2016 Forbes article titled, New Data Shows that Leaders Overestimate How Much Their Employees Want to Change, states that 45% of employees report they generally like to remain in the status quo (even if they think change is needed).
Also critical to a new CEO’s success is the way the change is rolled out and managed. Communication is key here specifically focused on the why, the where, and the how. Effective change management will build needed trust and credibility for a new CEO.
And watch out for a common pitfall with new CEOs, which is fundamental attribution error. This is when someone overestimates individual choice and underestimates situational or contextual influences, such as culture, size of org, history or org, etc. Essentially, just because something worked at X Company doesn’t necessarily mean it will work at Y Company. Keep this in mind and always, always, always consider the context before making changes.
Challenge #5: You no longer know everything
Most CEOs are in this position because they are an expert in their division, function, or field. This expertise, however, doesn’t always directly translate to enterprise leadership and requires a refocus from content or issue area to enterprise vision, strategy, systems, culture, and people. New CEOs who want to know everything, or who won’t act until they’ve developed expertise in new areas, are set up to fail.
What to do instead? The new CEO needs to learn just enough to be able to lead their leaders and experts, and discern when they’re on track or off track. This comes with asking good and illuminating questions, listening deeply, and thinking of yourself as a facilitator of their success.
As a new CEO you have an incredible opportunity to shape the direction of your company, invest in people and culture, and make positive changes. And with great power comes great responsibility, so investing in yourself and your growth is mission critical.