Leader's Edge Column

The Foundation Stones of Leadership

A good CEO clearly spells out his goals and objectives -- and then gets his team to come up with ways of achieving them.
By Don MacRae

At a recent two-day retreat, I worked on a strategic-action plan with the CEO and executive team of a large international company. It's referred to as an "action plan" because it sets out how the company is going to invest its financial and human resources over the next 12 months. The emphasis is on doing, rather than on navel-gazing -- the time-wasting exercise that occurs at many companies.

The CEO began the meeting by recapping recent corporate highs and lows, and then clearly defining the objectives of the next year: revenue and profit growth, customer service, and operational excellence.

Then he turned the meeting over to me. I explained that the agenda for the two days would require all members of the executive team to present what they had identified as their strategic objectives for the coming year. Once the objectives had been described, revised if necessary, and approved by the CEO, we would spend the remainder of the meeting developing criteria for success and implementation plans.

BIG ROCKS.  Before the executive presentations, I recounted a demonstration that Harold Taylor, a colleague of mine, once gave during a time-management seminar. On a table, he placed a large, transparent-plastic container with an oversize opening at the neck. He placed a tray of fist-size rocks beside the container and asked the participants to guess how many he could get into it. There were several guesses. He then filled the container to the top with 15 big rocks. He complimented the people who had guessed accurately, and asked: "Is the container full?"

The response was quick. The container was full. With that, he reached under the table and brought out a pail of gravel. Shaking the container, he poured a good deal of gravel into it, around the spaces between the big rocks. He again asked the question: "Is the container full?"

The hesitant response was: "It probably isn't!" He reached under the table again, retrieved a bucket of sand and repeated the process. Before he could ask the question, the answer came: "It's still not full!"

He said: "You are absolutely right," and proceeded to pour a significant amount of water into the container, filling it to the brim. Then he asked his audience to explain the point of the demonstration.

PRIORITIES.  Since this was a time-management seminar, most answers related to the theme of being able to squeeze one more thing into a busy life. Taylor listened patiently, then finally said: "No, the point is this: If I hadn't put the big rocks in first, I wouldn't have gotten any of them in."

The room was silent for a moment, as the executive team contemplated that message as it related to their planning meeting. Heads began to nod as the participants absorbed the lesson of putting the big rocks first.

At the meeting I was co-handling, we went on to hear the strategic objectives identified by each member of the executive team. During those presentations, I sensed that the CEO was uncomfortable with what he was hearing. I asked why, and he replied that what he was hearing was not the "big rocks" but more like the gravel or sand. Furthermore, spending time or resources on the initiatives being mentioned would deliver such small returns that he wasn't prepared to sign off on any of them. I suggested we call a break, during which we could decide how he would like to address his concerns.

THE MUST-DO'S.  During that pause, the CEO went to the flip chart and wrote: "The Big Rocks." Under that he wrote three points -- the same three he had mentioned in his opening remarks: (1) growth in revenue and profit, (2) customer service, and (3) operational excellence.

The CEO explained emphatically that these were his priorities. "Without revenue and profit growth, why are we doing any of this planning? We are losing customers because of our poor service and dismal quality control in our manufacturing operations. This is where we will get the best return. These are the three issues that the action plan must address." We decided the CEO would lead the meeting after the break.

He gave a passionate presentation outlining his three priorities. Then, he asked members of the executive team to rewrite their objectives and to present their revisions in one hour. Rather than consternation, a sense of relief seemed to settle over the room. Their direction was now clear. When the executives returned with rewritten objectives, the CEO signed off on all of them.

RECIPE FOR DISASTER.  I have seen this scenario repeated in a number of planning meetings. Executive team members come prepared to take their planning in one direction, only to find out that the boss has quite different ideas. This happens for a variety of reasons. Most often, the CEO thinks the priorities are clear, asking "haven't we have talked about them in a hundred meetings?" Other times, CEOs aren't clear themselves on what the company's direction should be until they listen to others and realize that the discussion is centering on the organization's "coulds" and "shoulds" -- instead of "musts." Whatever the reason for the disconnect, that's a recipe for disaster.

If you're a corporate leader, prepare your followers for strategy meetings. Prior to the meeting, clearly and emphatically communicate the direction you have in mind for the organization and your priorities. You'll enjoy focused, energized, productive meetings devoid of confusion, anxiety, and frustration. You'll also enjoy a tremendous return on your investment as CEO -- because providing timely, clear direction is one of the "big rocks" of corporate leadership.

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