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Summary: These days, corporate boards are aggressively punishing poor CEO performance.  This trend is continuing even in the face of a rising economy and good stock market.  The author has an answer for those CEOs who want to make substantial and sustained improvements in company performance: focus relentlessly on championing small-unit leadership.  

CEOs And New Leadership Skills: Getting The Troops To Do The Job
by Brent Filson

Corporate boards, armed with new federal rules and stock exchange requirements coming in the wake of the corporate scandals of the past few years, are firing CEOs in record numbers.  It all reminds me of an observation made by Gen. Dwight Eisenhower.

"Generals move pins on maps," he said, "but front-line troops must get the job done."

Clearly, big-picture strategy is key to getting the job done.  Business generals, the CEOs, must be able to move with skill, precision, and vigor the pins of capital across whatever large-scale competitive maps they confront.  Masterful pin-moving pays off in stock upswings. 

But often CEOs, so intent on the pins and map, lose sight of "the job" and getting it done — the actual doing of what their business is organized to do.

And the key to doing well what their business is organized to do, is leadership — in particular, small-unit leadership.

Without good leadership in front line units — the squad leaders and platoon commanders or their business counterparts, the supervisors and first-level managers — organizations eventually stumble, no matter how skillfully the top leaders move pins on the maps.

But most CEOs are neglecting small-unit leadership.  Time and again, in company after company, I have seen technologists promoted off the line to be supervisors, salespeople made local first-level managers — and yet they were not helped in substantive ways with their leadership skills.  Instead, the CEOs of those companies focused persistently on reengineering, acquisitions and divestitures.

Sure, pin-moving in many companies has resulted in boosts in their stock prices.  The pin-pros might have looked like heroes to many shareholders.  But I wonder how well-positioned those businesses are to achieve consistent earnings' growth over the long haul without skilled, small-unit leadership.
Earnings' growth rests on a tripod: one leg, strategy; the other leg, resources;  the third leg, execution.  Small-unit leadership is the execution leg.

I submit that in the coming years, many CEOs will come to realize the importance of small-unit leadership to shareholder value.

Here are suggestions on how to make it happen:

First, RECOGNIZE:
CEOs and senior executives must recognize the importance of small-unit leadership.  Many CEOs are so riveted to strategic considerations that they ignore the opportunities of such  leadership.  And when leaders are ignored, they become inept.   Until CEOs make such recognition, small-unit leaders can only put down roots in stony soil.

Second, DEMONSTRATE.
CEOs just can't pay lip service to small-unit leadership.  They must take concrete actions to demonstrate that they recognize its importance.  Demonstrated commitment to small-unit leaders will lead to committed small-unit leaders.  Without top-down commitment, effective small-unit leadership will not flourish throughout the whole business but exist instead in relatively ineffective, scattered islands.

CEOs demonstration of recognition must include:  encouraging the development of small-unit leaders, celebrating their achievements, measuring their small-unit leadership-performance, developing compensation that is tied to such performance, and developing training programs that constantly bring small-unit leaders to ever higher levels of excellence.         But top-level commitment, though necessary, is not sufficient.  CEOs must not only drive small-unit leadership down throughout all levels of their organizations; but they must also enable the recognition and demonstration of such leadership to come up from the ranks.  A passion for small-unit leadership must soak the entire culture of the organization.  Excellent small-unit leaders don't just happen on the scene.  They must be cultivated.  Their leadership skills must be spotted early in their careers.  They must have mentors.  They must be mentors.  Small-unit leaders must understand that they are not leading well until the people they lead are leading well.

Third, CHALLENGE:
CEOs, as well as all other employees, must have high expectations for small-unit leaders and must hold those leaders to those expectations.  
A successful executive told me that his career was changed by a small-unit leader who held him to high expectations.  At one time, the executive was a high school dropout working on the assembly line.

"During breaks, I always had people gathered around me," he said.  "I had this knack of getting them interested in what I had to say.  One day, my supervisor told me something that changed my life.  He said, "I've been watching you with people, and you're a natural leader.  With more education, you could go far."

The executive said, "Until then, I never looked at myself as a leader.  Suddenly, I had a vision in life.  I was something I didn't know I was: a leader.  I finished school, went to college and came back here.

"That supervisor's passion for leadership defined my career.  He was always spotting potential leaders and challenging them to become leaders.  His teams consistently racked up the numbers because of his leadership — and the leadership of those that he challenged to be leaders."

When CEOs realize that shareholder value is driven not just by strategic considerations but also by the heartfelt actions of skilled, small-unit leaders, when CEOs link their strategies, processes, and resource-allocations to furthering the effectiveness of those leaders, they'll create what most shareholders are really looking for — companies with front line troops that can get the job done.

2005 © The Filson Leadership Group, Inc.   All rights reserved.

The author of 23 books, Brent Filson’s recent books are, THE LEADERSHIP TALK: THE GREATEST LEADERSHIP TOOL and 101 WAYS TO GIVE GREAT LEADERSHIP TALKS.  He is founder and president of The Filson Leadership Group, Inc. – and for more than 20 years has been helping leaders of top companies worldwide get audacious results.  Sign up for his free leadership e-zine and get a free white paper: “49 Ways To Turn Action Into Results,” at www.actionleadership.com