Transcript of The Leader's Role in Building a Great Leadership Team Webinar

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Well, it's 1:01, and I wanted to welcome you all. We have a great turnout today. My name is Jack McGuinness, and today is April 25, 2018, and it's our April edition of our Great Leaders Build Great Leadership Teams webinar series. Again, I'm thankful that you all could participate. I'm sure we'll have a few more joining throughout the course of the session.

A couple of logistical items. First, I'll take questions at the end. Stay on as long as you'd like for questions. Also, as you'll see throughout the course of the session, I kind of make a thick PowerPoint, meaning there's lots of bullets, and potentially a little bit more meat in there than you might typically see on other webinars, as I like to ... You know, I pass these and distribute these out after the webinars, to people that participate on them, and hopefully you see it as a good tool. I've gotten some feedback that, thus far, they have been useful for bringing back to your CEO, or taking to your leadership team and using as a discussion tool. So that's just a little note on logistics. What else? I guess that's it, so I look forward to getting started.

Today's topic is the leader's role in building a great leadership team. I work ... Our firm, Relationship Impact, works primarily with the executive teams of companies large and small, and our primary purpose is twofold, to help executive teams build the structural capability and the relational capability to be as effective as they possibly can be. The number one issue that we typically see, and you'll see throughout the course of this webinar, is getting teams to have productive discussions about the most important issues that they're facing. So that's what we're all about, and I look forward to talking to you today about the leader's role in building a great leadership team.

So, let's start with what are some of the common frustrations that we hear some of our CEOs commenting on? These comments came directly from a new client we're working with in the Midwest, who's a manufacturing company, the first interview with the CEO. These are some of the topics that he presented to us, and they're not dissimilar ... There's maybe some more, but they're not dissimilar to some of the other challenges we see, or the frustrations we see with some of our other CEOs.

"Our team is very talented. We have a good group of people, but they just don't seem to be on the same page, and I find myself having to constantly exert myself to get folks on the same page." Number two, "Our team is stale. We kind of just come together in our weekly, monthly, biweekly, whatever management rhythm, and we're reporting out to each other, but not a lot of challenge, not a lot of debate, and therefore not a lot of pushing the ball forward and continually striving to get better, unless I'm digging in and pushing it."

Another challenge we see. We see this quite a bit. We ask the question, "How well do you guys debate and challenge each other?" And they say, "Well, we really like each other, you know? We all get along really well," and, for us, that's a key sign that that's great. We want people to like each other, but are they really challenging each other? Are they really debating well? And in this case, the CEO is frustrated that his team, without his influence, is not really working well together without him. That's not the case in all of the clients we work with. We have some cases where the CEO is actually the biggest challenge in moving the ball forward, and we'll talk a little bit about that as we move forward today. So these are just some of the common frustrations that we've seen recently.

Some of the challenges related to building a senior team, or executive team, or leadership team. The first is that most of the executives that we work with assume that by bringing together a smart, talented, experienced group of people, that all of a sudden then we'll have a great team, and that unfortunately, from our perspective, has not been always a valid assumption, and a couple things get in the way of that, right? And they're just sort of natural.

The first is you have a group of executives that have risen the ranks, coming together either internally or from outside the organization, that come from some varying experiences, backgrounds, and have different ways of looking at stuff, which is a good thing if harnessed properly. Secondly, executives typically come to their teams, or leadership teams, because of a specialized functional, or managing a particular function or business line, and these responsibilities often reinforce the individual contributions. Either they're focused on their units, departments, lines of business, whatever, which sometimes compete, and often compete with their enterprise, moving the ball forward as an enterprise, which we'll talk a little bit more about as we move forward here.

So, it's not always a good assumption, from our perspective, to assume that just by bringing together a smart, talented, experienced group of executives, that they're going to function well as an executive team, and from our perspective, nurturing is important. And what we mean by nurturing is not spending a lot of time, doing a lot of team-building exercises, or even hiring a firm like ours, but it is just making sure you're taking a step back and making sure you, as the leader, are taking time to look at what you need to do, both structurally and relationally, in terms of relational dynamics, to set your team up for success.

I can't remember where I stole this quote from, but it's a good one. I should probably acknowledge it at some point, "Great leadership teams never succeed by accident. Without nurturing, leadership teams can actually become organizational impediments." And I'm sure that many of you that are on the call today have seen this firsthand. Leadership teams are designed to accelerate organizations. They're designed to work as what we call force multipliers for an organization, meaning the sum of the ... the individual contributions of any one team member are not as great as the team collectively. And unfortunately, that is not the case all the time, and we believe that just with some attention placed on nurturing a team can really, really have an accelerating impact.

So, our point of view is that we believe that ultimately, when a great team comes together and puts the time in, the nurturing, and some time, and the commitment on each team member's part, when they can evolve into one where the leader is more of a coach, and the team becomes competent at holding itself accountable. But we also recognize that in order to make that happen, the leader has a strong role in setting the team up for success, right? Therefore, the title of this webinar is The Leader's Role in Setting up the Leadership Team for Success.

So from our perspective ... Oops. From our perspective, there's six conditions for building a great leadership team. Actually, as an aside, I just ... In terms of getting better myself, at doing these webinars and doing some of this marketing stuff, I was on a webinar last week, and one of the keys to success for webinars is the number of items you have on your checklist or whatever, and they say three, five, and 10 are great numbers to have. Unfortunately, I have six points here, but anyway, we believe these six points are really important, and this is what we believe the leader needs to be doing to set a team up for success.

The first set are what we would refer to as structural type of items, that have to be actively managed by the CEO, the president, the general manager, and put in place by the CEO, president, general manager, the senior team leader. Those things are actively managing the development of a compelling team purpose, actively managing the establishment of, or the creation of, an appropriate operating model, and finally, putting in place a sound management rhythm that supports the operating model and team purpose. And again, I'll walk through each one of these in greater detail as we walk through here.

The other thing, and we find these to be almost more important than anything, are the modeling of certain behaviors. Sorry. Modeling of certain behaviors. First, modeling self-awareness, being self-aware. I'm sure that many of you have come across people that are very self-aware and those that are not self-aware, and as a CEO, as a leader, really important to be self-aware if you're going to build an effective leadership team. We'll obviously talk more about that. Productive dialogue, modeling productive dialogue, meaning ... I think I talked earlier, when I set up the discussion, about the fact that most of the time we spend with the executive teams we work with are getting them to have productive discussions about the most important things that they're facing, and in order for that to happen, the CEO, the general manager, the president needs to model those behaviors, which we'll talk about in a little greater detail in a few minutes. And they also need to model accountability. You know, self-accountability and also holding others and themself accountable.

So, these six conditions, we believe, are key for senior team leaders to establish, you know, put in place, to build great leadership teams. And as you'll see as we walk through these, and this is probably not a great plug for myself, but it's not necessary to ... You don't have to bring a consulting firm in to do this. We believe that we're helpful, but it's not about the time. It's about the nurturing and the stepping back and making sure that you're thinking through what are the key success elements, before building an effective team.

Interesting enough, I'm working with a trade association here in DC, and it's become very clear that the CEO believes that team-building activities, like events, like going out to drink, and having yoga classes, and things like that, are the critical elements of building not just an organization, but building her leadership team. And while those things are helpful, they are superficial at best, and the things that we're talking about here are really the roots and the foundations for building a team that can actually have each other's backs and hold each other accountable, and focus on the most important issues that the organization's facing. Okay, so let's go through these one by one. I'll try to be as concise as I can, and again, I have lots of words on here, and these are really for you to take and use with your teams.

I'll try not to read word by word on the slides, but creating a compelling team purpose. A lot of the teams we work with, a lot of the clients we work with will say, "Well, our purpose as a leadership team is obviously to carry forth the mission of the organization and execute on the strategy of the organization." And while that is obviously 100% true, if just looked at like that, then teams will be, from our perspective, underutilized, sub-optimized. So from our perspective, the team purpose really needs to focus on the most important enterprise-related issues, cross-organizational issues, that the organization needs to address to execute on its strategy and move towards its mission, move towards its vision, and that it needs to bring together its senior people so that those enterprise issues can be addressed in an effective way.

I stole this quote here from a woman named Ruth Wageman, who wrote a book called Senior Leadership Teams. She says that the purpose of a leadership team has to go beyond strategy and the mission and focus on what the CEO needs this group of enterprise leaders to do that cannot be accomplished by any other set of people at this time in the organization's lifecycle. Emphasis on at this time in the organization's lifecycle, because the lifecycle changes and the needs change. And just to get clear, here are some ideas behind the rationale for creating team purpose. So these are just three current clients that we're working with.

It's a young professional services firm, growing beyond a highly-concentrated customer mix, so it's about a 75, $80 million professional services consulting firm started about five years ago, and has a high concentration on one customer. About close to 70 or over 70% of their revenue comes from one customer. So obviously, they have plans to diversify, and they've been doing that. They have three lines of business that they have established, but right now, until recently, they've been tripping over each other.

For example, their three lines of business leaders and their sales people within each one of those lines of business are going out and talking to the same customers, for example. So what they've done is they've taken a step back and said, "Now, as a leadership team, we got to get really focused on growth and we got to get focused on efficient and effective growth. So what that means is we have to have a common good, a market strategy across our lines of business. We have to have a similar selling approach across our lines of business. We have to have the infrastructure that supports that go-to-market approach, and it's up to us as a leadership team, the heads of the line of business, the head of marketing, the head of enterprise sales, the CFO," that had to get together, and their focus is on, "How do we grow beyond our current customer mix?" So that's one example.

Another example is we have a 90-year-old manufacturing company with aggressive growth goals in need of new talent. Bottom line, this company was floundering a bit. They brought in a new CEO. They were located in an area of the country that was devoid of the talent, the engineering and marketing talent that they needed, so they moved to Chicago and hired a whole bunch of new people, so inserted a whole bunch of new talent. And also, what they've done is they've kind of sort of rebranded as ... They're calling themself a 90-year-old startup. So, all of the efforts they have, and the priorities they're focused on, that the leadership team is driving is on, "How do we grow for the next 10 years, to be 100-year-old startup?"

So, compelling team purpose is really getting the organization focused on what's most important and getting the leadership team, as a unit, to be driving that purpose. That's it in a nutshell. I used a lot of words to talk about it, but really, that's really important focus for an executive team. We believe that that is a condition for building an effective leadership team, is really having a sense of what this team is supposed to be doing together, rather than just as individual functional leaders.

Second condition, creating an operating model, a team operating model. And this is sort of a fancy word, but it just means what's the construct we're going to use to manage our leadership team? And typically, this is related ... There's a symbiotic relationship between the operating model and the team purpose, as well as the management rhythm, which you'll see here in a second, but the level of complexity that the organization is facing, the challenges that it's facing, typically have an impact on the type of model that is used, right?

So a consultative model is one model that is often used, and it's frankly the model that we see in a lot of the young organizations that we work with. And even if they're not stable, but typically, the consultative model is a far more stable environment, where really, they're providing advice and counsel to the CEO and the CEO is making all the calls, right? And you know, they meet regularly, they provide input to each other, but it's really an advice and counsel kind of model more than the integrative model, which is for more complex type of environments.

The examples I used before, of the young professional services firm or this growing manufacturing company that's kind of trying to redefine itself. Those are complex, competitive environments, and the leadership teams in both of those instances have taken it upon themselves to focus on the most important areas, to execute on those important strategies. So these teams, leadership teams, actually make decisions on the areas most consequential in driving the strategy. It's not just advice and counsel. The teams have their sub-components of a leadership team, potentially, that is highly interdependent.

They share responsibilities, they have regular collaboration, and they're focused on ... For example, we talked about that professional services firm. They're laser focused on their go-to-market strategy and making sure there's consistency and innovation driven into that go-to-market strategy from all facets. You know, "How do we support it from a human resources, from a recruiting perspective? How do we support it from an overall marketing perspective? How do we support it from a financial perspective, to ensure that the business lines have the budgets they need?" And then obviously, "How do we drive the individual lines of business in concert with those other cross-organizational issues?"

So, really important from our perspective, to find what type of operating model, and we're not suggesting that a consultative model is not a fine model, particularly for young organizations that are fast paced, and potentially the CEO is going to be making all the calls, and the advice and counsel model is fine. But when you're starting to grow, and you're getting ... and the environment's becoming more complex, you really want to draw on the talent of the leadership that you brought to the table, to address these cross-organizational interdependencies, because that's what's going to help drive the rest of the organization and make them continue to focus on what's most important, and the key priorities that are driving the organization. So that's operating model.

Third, management rhythm. And this is really just a fancy phrase for how leadership teams tackle the tactical and their strategic execution. You know, what plans in metrics do they have in place? What communication vehicles are they using to communicate up, across, down the organization? And how do they meet to address both of those tactical and strategic issues? Operating model obviously has a strong influence on driving the management rhythm. You know, if you have a more integrative operating model, the complexity of your management rhythm is a bit more challenging.

A few guiding principles. Really important from a management rhythm perspective, to maintain discipline and adequate time for discussing and debating strategic issues separate from tactical issues. Something we see oftentimes, with young, fast-paced companies, is they put time aside to talk about the strategic stuff, maybe monthly, maybe quarterly, whatever their rhythm might be, but because they're typically resource-constrained, when they meet, they're laser focused right back on those tactical issues, and can often lose sight of focus on strategic issues.

Another guiding principle is we recognize, again, fast-paced and virtual organizations, really important to find time to meet periodically, face to face, particularly as it relates to the next three conditions I'm going to be talking about, in terms of building relational dynamics. Really hard to do that without some facetime.

And then third, we've worked with a lot of teams that don't necessarily take time to step back and document expectations, plans, action items from meetings that they participate in. Really important to build in the discipline around documentation and keeping track of tactical and strategic execution. Some companies are great at that, other companies not as much.

So, the first three conditions were the CEO, we believe the CEO is really an important job in setting up and establishing what the purpose of the executive team is at this point in the organization's lifecycle. Number two, establishing and just clarifying what the operating model is for managing that leadership team. And third, making sure you're taking time to step back and thinking through how are you going to keep track of the plan of attack? How are you going to communicate? And what mechanisms are you going to use to meet, to make sure you're on track?

Next set of conditions. We find ourselves focused mostly, on the executive teams we work with, on these next three conditions, as a team, and also when we spend time, we spend a lot of time with the CEO, general manager, president up front in our engagements, focused on helping them build the ... or model the more behavioral or relational elements of building an effective executive team. So, modeling self-awareness is huge, and the first thing you would have to ask yourself is someone has to be self-aware to be able to model self-awareness, and I get that. And this is where sometimes outside help, or HR support, or even a reflective CEO can step back and say, "Okay, what are the things that I'm doing that are getting in the way of our success as a team, number one, and then as an organization, number two, to drive the organization?"

We all have blind spots. They could be not listening when we think we're listening. They could be being loud and boisterous, and cutting off people when they speak. There could be a host of behavioral issues that get in the way from a team being as effective as they can be. But, if the CEO doesn't identify what he or she needs to do, behaviorally, to be a more effective leader for this team and this organization at this particular time in its journey, then it's very hard for them to hold anyone else accountable for being self-aware. So, I get that part. I get that pushback a lot from particularly VPs, and say, "Well, if our CEO's not self-aware, how are we going to get him to be?" You got to give him feedback.

So the first thing is that when we're coaching CEOs, we're talking to them about, "You got to know your blind spots from two perspectives." It's not good enough to just know what you think. You have to find out what others think, right? So great book by Tasha Eurich called Insight, and I have a list of resources at the end of the slide deck here, three books and an article I've just written for Chief Executive Magazine, that are listed here, but Tasha Eurich wrote a great book on self-awareness called Insight, and she talks about two sides of self-awareness, internal and external self-awareness. Pretty simple concept, but not as simple to put in practice, right?

So, internal self-awareness is how we see our own values, passions, reactions, and impacts on others. And that's valuable, really, really valuable. It's important to step back and ask yourself, "Huh, what am I doing that's really good and what am I doing that's not so good, that's getting in the way of our team being as effective as it can be?" And that's really important to understand that. Most importantly, however, is external self-awareness, and not just assuming that you know how others view you, but asking how others view you, right?

I'll often go in, when I start an engagement with an executive team, I spend a lot of time, like I said, up front with the CEO, and then as part of that, I'll talk to the members of the executive team, and oftentimes, many of their direct reports, and the disconnect I often get between how the CEO sees himself or herself and how others see them is remarkably different, oftentimes. And it could be just subtle things, like, "I stopped giving the CEO feedback, because he doesn't listen to me." That could be two levels down in the organization or it could be a direct report. "I feel like when I speak, the CEO is not necessarily paying any attention to me," right?

It's interesting, when I go then talk to the CEO, the CEO said, "Well, I listen. I have an open door policy. I want people to come in and talk to me." However, they think they're listening, and that is what we call a blind spot. They really are real things. It's a real, real psychological concept, the blind spot, and again, there's another book that I have in the resource section here, called What Got You Here Won't Get You There by Marshall Goldsmith. It's a whole list of ... whole discussion of senior executive blind spots.

So, modeling self-awareness is huge, and it's really probably one of the hardest things we ... hardest times we have in working with the executives we're working with, is really getting the CEO to be self-reflective and understand how others view them, because without that, the next two things I'm going to talk about are almost impossible to put in place.

Modeling productive dialogue is, as I said before, one of the things we spend a lot of time in the executive teams we work with on. We came up with this. We define productive dialogue, my partner and I, as the ability for teams to challenge, debate, and discuss their most important issues in a manner that progresses the issues and leaves minimal relational scars, with a focus on minimal. You know, it's never going to be perfect, and it's not always going to be 100% productive, but really important that you strive to get to a place where you can talk and engage about the most important things you need to talk about in a productive way.

Really interesting, I had a year follow-up from an engagement I'm working on with a $150 million government contractor out in Weston, Virginia yesterday, and they've made tremendous progress in the last year due to the commitment of their executive team to focus on, and listen, and do the stuff that I'm preaching here in this webinar. But they still have some challenges around conflict and confronting each other. It's a four-person executive team, and then who I met with yesterday was like a 14-person leadership team, so the next level down, of reports from the four.

The CEO challenged them. He said, "In the next 10 days, I want all of us to lean into confronting each other more effectively. Doesn't mean yelling at each other. Doesn't mean being mean to each other or disrespectful. It just means when I'm frustrated with something that someone else is doing, that I take the time to talk to them about it. When I have an opposition or a disagreement about something, that I take the time, don't let it fester, and go talk to the person about it," and they're going to get back in 10 days and see how that part went, and they're challenging each other to actually do that. That didn't come from me. That came from him. I'm going to use it again with other clients, but it was a really cool, cool thing in terms of leaning into the productive dialogue part of this. Really important.

In order for the teams to be able to have productive dialogue, the leader needs to demonstrate, like we said, self-awareness, and then they need to be open to feedback. And open to feedback doesn't mean, when I get the feedback, coming up with five reasons or rationales why the feedback was wrong. It means listening, asking questions, and saying, "Tell me more about what you mean by that. I'm not sure what you mean," or, "Wow, I never thought about it like that." So being really open to feedback, and demonstrating and modeling how to be open to feedback, is really, really important for a senior team leader to do, or to model.

Actively listening to different perspectives, even those that you don't agree with, even those that seem like they're out in left field. Doesn't mean you have to agree with them. Doesn't mean you have to acquiesce, but establishing an environment where people can present alternative views on important issues is important.

And then third, as I talked to you about my client yesterday, is viewing confrontation as a natural part of the way teams operate. We had a great conversation yesterday, about ... We've moved away from talking about conflict, and we've started talking about productive dialogue and confrontation. And yesterday, we got to a point where we were just ... I got to a point where I was just saying, "Look, all we're talking about is having better conversations when there's disagreement, when there's opposition." So how do we have a better conversation when we have two opposing, or not even 180 degrees, but two just different points of view on a topic? So not avoiding that confrontation, but embracing it, and the key to that, I believe, is feedback, being open to feedback and listening to other people's perspectives. And the way this really gets done well is when the leader models it well. When the leader doesn't model it, it's a very difficult uphill climb.

So, to summarize, modeling productive dialogue is all about senior team leaders, presidents, general managers, CEOs being open to feedback, actively listening to different perspectives, and starting to view confrontation in a different way, as a part of the natural way of a leadership team's operating. When these things happen, the leadership teams are much more likely to engage in productive dialogue. Doesn't mean they're going to be perfect at it all the time. There is no perfect. There's no perfect situation, but good teams have a way of ... When they get off track, they have a way of getting back on track, so modeling productive dialogue is very important.

Okay. Again, I took this from ... I used this at another webinar gave, but I thought it was relevant here. A landmark study by a woman named Amy Edmondsdon. She gives a good TED Talk by the way, which I included down here. Amy Edmondson discovered that the highest-performing teams were the ones with the highest reported errors. Teammates were comfortable openly admitting mistakes, and they weren't afraid to tell the leader that something was wrong. I don't know about you, but that's not necessarily the environment I see, I have participated in as a leader on an executive team, or leader of an executive team, and with the clients I work with. It's not always the simplest thing to do. This is easy to say, hard to do. The things I talked about back here, on this page, will help a team towards having more productive dialogue.

Finally, condition six, modeling accountability. Truly great leadership teams, we believe, as I said earlier, evolve into ones where the leader is more of a coach, and the individuals feel accountable to each other rather than just the leader, and the team becomes competent at holding itself accountable. And what does that look like? You know, we sign up for things, right? We have a team purpose that we're moving towards. We sign up things, either to work on as part of a sub-team of the leadership team, or even as just a functional area, bringing something to the table, and we sign up for it, and we don't deliver on it, and we ... The team has the ability to say, "Hey, Jack. You said you were going to do that and you didn't do it. Is there anything that's getting in the way with that? Can we help you with that? We really need that."

That's a hard thing for teams. There's a great study that was done not too long ago on executive teams. I think it was by McKinsey, and one of the biggest things they said in this study was that one of the hardest things for senior executives to do is to hold each other accountable. And it's unfortunate, but it's true. Senior team leaders are absolutely critical in establishing and continually reinforcing the team's accountability construct. They must model receiving feedback well. You can see the overlap in these things, modeling accountability, self-awareness, productive dialogue, right? There are definitely some overlap here, but really important for a team to be able to hold itself, each other accountable, they have to be able to give feedback, and I think the most important part of the feedback loop is how we receive it. And again, the leader is responsible for setting up the environment where that can thrive. So being curious, being non-defensive, is huge.

Next, leaders need to clarify that their job doesn't exist to settle problems, act as a mediator, constantly monitor team disputes. Rather, it needs to be focused on modeling, creating an environment where peers address concerns, where the team addresses concerns immediately, directly, and respectfully with each other.

That's the sum. It was 45 minutes. I'm getting better at this each time I do it. Pat myself on the back a little bit. So, the six conditions. We'll go back to the page with the six conditions on them. Leaders need to set their ... are responsible for creating the conditions where teams can be effective, and from our perspective, there's three things they need to actively manage. They need to make sure that there's a sense of compelling purpose for this team as a unit, they need to create an operating model that's reflective of that purpose, or that's in sync with that purpose, and a management rhythm that supports both.

Most importantly, senior team leaders need to model behaviors that they expect of their teams. They need to be self-aware. They need to not just be self-aware and think about ... They need to think about what their others ... how others see them. They need to model productive dialogue, debating in the most and challenging each other on the most important issues the organization's facing. And, they need to move the team in a ... evolve the team to a place where the leader's role is more of a coach. Of course, they have authority, accountability as well, but where the pendulum is swung more towards having the team hold each other accountable versus the leader.

Let me go to a few resources, three great books and a recent article. I mentioned all three of these, but great books, What Got You Here Won't Get You There by Marshall Goldsmith, Insight by Tasha Eurich, and Senior Leadership Teams by Ruth Wageman. And I just wrote an article for Chief Executive Magazine, called The Leader's Role: 6 Conditions for Building a Great Leadership Team, that in effect describes what I've talked about in this webinar in somewhat greater detail.

So, one more thing. For those of you who are interested in having your CEO, or if you are a CEO, take a complimentary leadership team assessment, please just go to my website and ... Actually, what I'll do is when I send out the slides from today's webinar, I'll include a link to the registration for the complimentary leadership team assessment in that. So, with that, thank you for spending some time with us.