Community//

3 shocking stats about CEOs that point to a huge weakness for businesses

Executives need to be aware of these -- and more importantly, how to ensure your business is on the right path.

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Image by Tumisu from Pixabay
Image by Tumisu from Pixabay

As the highest-ranking executive in a company, the Chief Executive Officer (CEO) makes major corporate decisions, manages resources, and handles overall operations. The CEO is not just a figurehead–he or she is determining the company’s trajectory and shaping its future. For that reason alone, you want to hire an educated, experienced, and well-rounded person for the position–whether the company has ten employees or 10,000. 

However, research shows that a large percentage of CEOs feel unequal to the task to which they are assigned — and most of them would welcome executive coaching and leadership advice with open arms.

In 2013, the Stanford Graduate School of Business surveyed over 200 CEOS, board directors, and senior executives, finding that nearly 100% of them saw the value in receiving advice from an outside consultant or coach. The executives indicated they would listen to advice on how to upgrade their skill sets, improve their performance, and further their corporation.

While nearly 100% of CEOs recognized their shortcomings and said they were willing to be coached and make changes based on what they learn, the same study reported that 66% of CEOs do not receive coaching or leadership advice from outside consultants. 

One way of interpreting that is that only 34% of executives are getting the information they want (and need) to succeed in their role. Studies also demonstrate that nearly half of executives fail within the first 18 months of getting the job, whether they come from within or outside the organization. Without coaching or outside help, is it any wonder that the rate of failure is so high?

With so much focus on choosing the “right” person for an executive role, organizations often overlook the need for a transitional period, which includes coaching, to get the person situated in the position. But even surviving those critical first 18 months doesn’t mean that coaching or outside advice can’t help an executive.

It isn’t just speculation that CEOs are hanging on by a thread–the Harvard Business Review reported on a ten-year study that found that 61% of executives feel unprepared for the challenges they face in their senior leadership role. In other words, organizations are often manufacturing systematic executive failure by choosing unprepared candidates, and not providing the resources they need to learn, grow, and mature into a stable force within the company.

CEOs often lack skills, and they know it. They’re not all megalomaniacal tyrants who have no idea that they’re under-performing — they know they need more in order to succeed. And while having an unprepared and under-experienced person in a leadership position is a massive weakness for businesses, the bigger problem is that organizations don’t see the need to help the CEO, whether they’ve been in the role for ten days or ten years. 

It’s too easy to view a CEO as an authority figure who’s “too high up to fail” or to project all sorts of unrealistic expectations onto the person simply due to his or her title.

The fact is, both sides need to come together to manage and resolve this kind of issue. CEOs need to firm up both hard (conflict management, negotiation, delegation) and soft (motivation, empathy) skills through coaching to make a difference in their effectiveness as a leader. And businesses need to get real about what it takes to both onboard and support a CEO in a methodical and ongoing fashion. Until that happens, businesses are setting themselves up for failure.

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