Your executive team may be your greatest source of hidden profitability. These talented leaders are the strategic and economic engine of your company. As they go, so goes your organization.
However, Gallup’s 2013 Study on the American Workforce says only 36% of executives and managers are engaged. 64% are essentially “checked out.” Gallup says, “Surprisingly, these people are not only a part of your support staff or sales team, but they are also sitting on your executive committee.”
Combating executive disengagement is the best way for companies to grow profits, and there are six key steps a CEO can take to ensure their company’s executive team stays engaged, passionate, and productive.
The Executive Cycle of Engagement
Six Steps for High Executive Engagement
- Clearly define and communicate your corporate identity and strategy.
- Your executive team needs to hear this often and be united around it.
- Without this as a focal point it is easy for executives to become unfocused and unmotivated.
- Evaluate how well you are reinforcing it. Pen Fed’s James Shenck says he reinforces his six strategic intents all the time.
- Build your executive team into a real team, not just a committee that meets periodically.
- This unifies them and bonds them together toward shared goals.
- It gives them the feeling of being responsible and accountable to each other.
- Commit to being in the people development business
- Show your executives you care about them. Demonstrating your concern for your executives consistently will help them stay engaged.
- Meeting one on one with them regularly to better know them and discuss their goals, frustrations, and development is very effective for this.
- Be open and vulnerable to build trusting relationships, otherwise they will not open up to you.
- Understand their strengths and weaknesses, and coach them to grow in their strengths
- Create a high quality leadership development program
- This is the Pen Fed approach. Each VP and above participates through team focused leadership instruction as well as a personal coach.
- Workshops on strategy development, innovation, people development, and technical skills can keep people and motivated and growing.
- Each participant should have a personalized development plan that is monitored, and for which they are held accountable.
- Your HR team should help you with this and keep a talent and development database.
- Challenge them with new assignments
- Put them in charge of new initiatives, such as product launches, new business units, or new technology investments.
- These assignments help executives reignite their creative juices.
- Equip them to coach and mentor their direct reports.
- Lead by example and have a growth plan for yourself
- For your own continuing development and for your entire CU, you need to be engaged in your own development plan and be willing to share it with your team.
- We began this discussion talking about hidden profitability, and saying there is no greater source of hidden profits than your executive team.
- Keeping your executive team engaged and passionate will produce many times more profitability and member benefits than anything else you can do. They are the heart of your company, and the rate at which they grow and progress has incalculable impact on your CU and its results.
- In his classic book, “The 21 Irrefutable Laws of Leadership”, John Maxwell describes the first law as “The Law of The Lid”. This law states that an organization can only succeed to the level of leadership’s ability to lead it. There is nowhere this is more important to a CU than its executive team.
- Executives who want to keep growing professionally are displaying healthy behaviors, so creating an environment that recognizes the importance of keeping them challenged and growing should be a prioritized piece of any CU’s strategy.
- To create this environment the CEO has to be fully engaged in the people development business and spend at least 40% of his or her time on it. Two essential tasks are forming the executive committee members into a real team with goals and accountabilities, and coaching each direct report in their professional development.
- All of this obviously takes time, money, and energy. Making this level of commitment requires you to fully believe in the potential of your executives. If you don’t believe in them enough to do this, why are they on your team?
- If you are wary of the commitment to executive development, consider the opportunity cost of not doing it. Remember, this process is so you can unlock hidden profitability, grow your CUs assets, and maximize member benefits. Not engaging in it is a vote for suppressing your CUs growth, profitability, and impact on its members.
CEO Challenge Questions
Apply these questions to your direct reports as well as to yourself. Ask yourself where the hidden profitability may exist in the answers.
- What are the career aspirations of my direct reports?
- What energizes each of them?
- What are the primary strengths and weaknesses of each direct report?
- What is the right development path for each person?
- Does each direct report have a development plan?