SHORTER CEO TENURE REQUIRES EVEN MORE STRATEGIC COMMUNICATIONS COUNSEL

By James E. Lukaszewski, ABC, APR, Fellow PRSA

Article Submission to Corporate Communications Yearbook

Copyright © 2002, James E. Lukaszewski.  All rights reserved.

It's probably time for a reality check on the business of being a CEO. The position of the CEO is less and less like it used to be:

• The average tenure of U.S. and Canadian CEOs continues to decline. The current range, depending on the study, is 40 months moving to 30. Yet, most organizations still develop strategic plans that extend well into territory occupied by a new regime. It would appear that this is a fundamental disconnect, which probably needs a remedy.
• One in four CEOs of major British businesses (sales over £500 million) left their jobs ahead of schedule in 2000. That's twice the 1990 rate. The trend continues in 2002.
• Huge compensation packages allow good or bad CEOs to drop out before they are fired or forced out.
• More and more non-business, non-operational issues, e.g., globalization, adverse legislation, and anti-corporate activism, are intruding on management. These interruptions seem soft and distractive, often requiring moral rather than monetary or business judgment. Management has yet to truly assess the threats these situations present.
• Recent scandals and more to come will force CEOs to accept more measurement based on morality or belief systems. On August 14, 2002, 1,000 U.S. corporate CEOs certified, in writing, the authenticity of their financial disclosures. More punitive measures will be taken against CEOs as companies are forced to restate or otherwise characterize their financial situations.
• In both the U.S. and in Europe, owner/shareholder problems and career-defining risks for CEOs are increasing, largely due to CEO related mistakes or non-performance.

The temporary tenure of today's new chief executives further emphasizes the unique strategic nature of this position. Consider:

• There is only one per organization. There is very little time for this individual to take hold of a senior management organization, get it focused, and move it forward. Top-level communication strategy is a crucial ingredient in making the urgent progress today's CEO requires.
• The CEO is the only individual within the organization with a total view of its environment. No one else has the perspective insight to truly understand where things have to head. Only the Chief Executive's personal communications power can penetrate the entire organization to make his/her view and vision the goal.
• There is no school for CEOs. Even if he/she comes to the job with extensive prior experience, each organization is unique with culturally specific attributes. Therefore all CEOs get their training on the job from the very beginning.
• Boards of Directors, inside and outside, are the CEO's only regular source of access to peers. Sixty percent of all boards are CEOs. Effective interpersonal communication with CEOs is a crucial skill set for today's executive communication advisor.
• The CEO is the organization's chief strategist. The Chief Executive position by function is the most strategic position in any organization. Strategists like to work with other strategists. As a communications counselor, how strategic are you?

Understanding CEO goals and potential short tenure is central to developing communication strategies that achieve their objectives. Burson-Marstellar maintains a special site on their corporate Web site called, "On the Mind of CEOs." Part of this site exhibits a study that talks about and ranks CEO goals, in general:

• To create superior shareholder returns 60%, industry leadership 57%, customer focus 53%, profitability 44%, best management 33%, best place to work 30%, best talent 25%, most innovative 23%, most admired 19%.

Helping CEOs achieve their business objectives through strategic communication depends on an understanding of their strategic goals and goal priorities.

It is interesting to understand the various leadership functions CEOs exercise daily. What do these people do all day? Keep in mind, leadership is primarily a verbal skill, as opposed to managing, which is predominantly an objective achieving or goal meeting or execedence process. The CEO's voice is his most powerful tool.

Here is my empirical analysis, based on years of daily CEO observation, of the various CEO leadership functions and the extent to which they are executed:

		Decision making:	5%
		Articulating:	40%
		Coaching/teaching/motivating:	40%
		Forecasting (guessing):	5%
		Admiration building (they like me):	6%
		Reputation repair (they trust me):	1%
		Restating, reemphasizing, reinterpreting:	20%
			------
			117%	*

* Yes these functions add up to more than 100%. The math is accurate, however, because the job of a leader is generally 24/7. Anyone who does anything on a 24/7 basis, is, by definition, doing substantially more than any peer in a non-leadership position. Are you a 24/7 person? Are you available and will you help on a 24/7 basis?

What is the communication leadership response to shrinking CEO and top management tenure?

First, make sure the key plans and programs really are in the interest and timeframe of current top management. Test your recommendations against these strategic measures:

• Programs help the boss achieve his/her objectives and goals, now.
• Ideas and suggestions help the organization achieve its overall goal.
• Ideas and suggestions are truly necessary and important.
• Not acting on your recommendations or programs will cause some aspect of the business to fail or fail to progress.

Second, be sure there are links between the shorter-term goals and programs, and enduring goals and programs.

• What are the continuity factors between previous employee communication approaches, and those that will help this new executive promptly achieve goals and objectives?
• What key relationships need to be maintained regardless of the current CEO's tenure and communication intentions?

Third, be prepared to help new leaders (who won't have the time to become old leaders) navigate effectively through the organization during their tenure:

• Operate and communicate in real time.
• Allocate 40 percent of top executive time to face-to-face contact with management and employees at levels below senior management.
• Always test the real time value of any non-verbal communication technique. In this environment, news is what's happening now. Very few non-verbal communication techniques have real time value because it takes so long to get them produced, distributed, and absorbed. That's why people hardly miss them when they are withheld or ended, which is the primary test for the value of any non-verbal communication technique. When it's withdrawn, how strongly does anyone ask for its return?

How do you evaluate your CEO's status? Fortune magazine's June 21, 1999 article, "Why CEOs Fail," provides an insightful list of six powerful indicators pay attention:

1. People Problems.
2. Decision Gridlock
3. Lifer Syndrome
4. Bad Earnings News (the most frequent problem)
5. Missing in Action
6. Off-the-Deep-End Financials

It's a different world for senior communicators and getting more challenging and more exciting each day. The question that you have to ask yourself is, do you have a desire to assume a much more aggressive and helpful management perspective on the business? Can you be an adapter to these new, more urgent, time sensitive executive management demands? Those who can, and those who do, will have interesting, important, powerful, personally rewarding careers that last longer than their current CEO, and probably their successor.

Copyright © 2002, James E. Lukaszewski. Used with permission of the author.