3 Costly Mistakes CEOs Make When They Fail Their Company Culture

The job of a CEO has never been this difficult. There is unprecedented pressure on CEOs to run their businesses through difficult and uncertain times. For many leaders, they have reached a breaking point. They failed to reinvent their companies, faced insurmountable reputational issues, or, at worst, faced insolvency. Many leaders succumb to this pressure, losing sight of the most important priorities. Corporate culture is one of those priorities that gets overlooked.

We’ve all heard the saying, “Culture eats strategy for breakfast.” For those who haven’t, the saying underscores the critical role that organizational culture plays in business success. This means that even the best-laid plans and strategies can fail if an organization’s culture does not align with its goals and values. For leaders, this saying highlights the need to prioritize and invest in building a strong and positive culture that enables the organization to execute its strategy effectively.

So why don’t many executives take corporate culture seriously? Too often, executives view culture as a set of overly “soft” initiatives that are not business priorities along with other important issues such as growth, M&A, product development, or business performance.

Below, we look at three common reasons why executives fail to cope with corporate culture and how they should overcome it.

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They become performative leaders rather than conscious leaders.

It’s amazing how many CEOs run their organizations just for fame and status. This type of performative leadership can damage the culture of an organization. Performative leadership focuses on the appearance of leadership rather than people and outcomes. It is characterized by a leader who puts his own image and ego above the needs of the organization and its stakeholders. This leadership style is often criticized for being superficial and lacking in content, which can ultimately be detrimental to the organization’s success.

In contrast, conscientious leadership is an approach to leadership that emphasizes self-awareness, empathy, and a commitment to ethical and sustainable business practices. As a conscientious leader, this means that the CEO prioritizes people and values ​​and strives to create a positive work environment that promotes employee engagement, innovation and collaboration. To be a conscientious leader, a CEO must be driven by purpose and strive to create long-term value for all stakeholders, including employees, customers, and society at large. By practicing conscientious leadership, leaders can build trust and loyalty among employees, achieve business success, and contribute to a more sustainable and just world.

Here are three top tips for becoming a more conscientious leader:

1. Practice introspection and mindfulness: Awareness is the cornerstone of great leadership. A conscientious leader must regularly reflect on their actions, biases, and decision-making processes in order to identify areas for growth and improvement. This may include seeking feedback from peers, participating in mindfulness practices, or even keeping a diary.
2. Empathy and Emotional Intelligence: Leaders can develop empathy and emotional intelligence by actively listening to their team members, considering different points of view, and prioritizing the well-being of their team. This may include creating a culture of psychological safety where employees feel comfortable sharing their thoughts and feelings.
3. Know when to make decisions from your head, heart or intuition: CEOs have to make many decisions every day, and too many of these decisions are often made at the head level, that is, they are analytical or rational in nature. While making rational decisions based on reason is important in business, it is also important for leaders to know when to make decisions based on intuition or emotional decisions based on the heart, even when the logic or rationale doesn’t match. Moving between the three types of decision making ensures that the leader makes decisions not only based on results, but also on people and culture.

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2. They think great communication is enough.

Some executives define good communication as constantly sharing vision and purpose, being transparent about the results and direction of the company, appearing at City Hall, hosting Q&A forums, writing articles in the monthly newsletter, and participating in discussion boards. While this type of communication is important, as you can see, great communication goes beyond looks. It’s about being a good human connector.

The CEO must learn to be a good liaison between people, which means setting priorities in building relationships at all levels of the organization. This includes being approachable, empathetic, and actively seeking opportunities to connect with others on a human level. And it doesn’t stop there – the CEO must be sincere in his dealings. They need to be kind and show that they care. When you know that a leader is committed to acting from a set of values ​​based on kindness, they set the tone for the entire organization. In fact, one study demonstrates that the kindness and generosity of a leader are strong predictors of team and organization performance.

Here are three key tips to help you become a great communicator:

1. Focus on presence: Too many leaders are transmitters when it comes to communication, constantly sharing information, facts, data, or ideas. Being present as a CEO means you will have a better understanding of when to transmit, when to receive, and when to hold the space or silence for new opportunities to emerge.

2. Complete the Stakeholder Matrix: Leaders influence hundreds, thousands and even millions of people. While it is not possible for all of these people to complete the stakeholder matrix, it is important for the CEO to understand their immediate stakeholders and be able to assess the quality of the relationship and therefore assess the extent of their impact. Communications will go unheeded unless the CEO constantly evaluates the relationship and strives to improve it.

3. Make trust the new business currency: As a CEO, it’s important to understand that productivity, profits, and a focus on big results isn’t your only currency. With a large number of employees currently unengaged in organizations around the world, the CEO must now explore how to use trust as a currency and diligently measure it across his organizations. A management confidence index it is a good tool that many organizations are currently using.

3. Commercial efficiency is more important than team efficiency.

Too often leaders overvalue their leadership efforts for the sake of business results. While creating commercial success is a cornerstone of the CEO role, many leaders become overly rational and left-brain oriented, and often lack the skills or knowledge to actually manage team performance. Too often, they think the answer is to hire top performers who collectively don’t really perform well as part of a team. This can create all sorts of problems, such as fragmentation, militancy, and team dysfunction.

Recent study from the Kellogg School of Management mentions that teams are not always successful with A+ players and that teams have a collective team intelligence that is separate from the team members’ individual intelligence. Building the collective mind of the team is critical for the CEO. This implies the presence of social skills and nuances in understanding personal motives and motivations. A CEO who invests in building a talented and diverse team contributes to the company’s success. The recruitment process should be rigorous and aimed at finding people who share the values ​​and vision of the company. Diversity and inclusiveness should also be a hiring priority, as different teams are more innovative and better able to solve complex problems.

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Here are three top tips for prioritizing team work:

1. Ground the key realities: Too often leaders are out of touch with the reality of their team. While one team member may think the business is doing well, another team member may have a different opinion. It’s really important for the CEO to ground our current realities and build a common sense when it comes to core business goals and metrics. This can be challenging on its own, so an experienced coach or facilitator can help with this process.

2. Take the time to set clear expectations and goals for teams to work: The CEO must prioritize the work of the team by setting clear expectations and goals that prioritize clarity of strategy, execution, collaboration, communication, and interpersonal ways of working. This may include creating metrics that measure team performance, such as employee satisfaction and engagement, rather than just focusing on revenue or profits.

3. Hire the right team coach: While leaders may have individual coaches, it is very important for the CEO to hire a team coach. Just like sports teams have coaches, so do teams of leaders. The team coach must focus on the team’s goals, not individual goals, and work constantly with the team to move them towards achieving those goals.

Creating a positive work culture has never been more important to the CEO role, and it starts at the top. They play a fundamental role in creating a positive culture that will ultimately guide strategy, engagement and performance. Taking responsibility for their leadership is key and recognizing where they contribute to the problem. Taking steps to become a conscientious leader, a strong human nexus, and improve team performance is a good starting point for any CEO looking to change their culture.