"It's lonely at the top" appears to be
truer than ever, according to a new study conducted by the Center for
Leadership Development and Research (CLDR) at Stanford Graduate School
of Business, Stanford University's Rock Center for Corporate Governance, and The Miles Group. Nearly two-thirds of CEOs do not
receive coaching or leadership advice from outside consultants or
coaches, and almost half of senior executives are not receiving any
either, the survey reveals.
"What's interesting is that nearly 100% of
CEOs in the survey responded that they actually enjoy the process of
receiving coaching and leadership advice, so there is real opportunity
for companies to fill in that gap," says David F. Larcker,
who led the research team and is James Irvin Miller Professor of
Accounting and Morgan Stanley Director of CLDR at Stanford GSB.
"Given how vitally important it is for the
CEO to be getting the best possible counsel, independent of their
board, in order to maintain the health of the corporation, it's
concerning that so many of them are 'going it alone,'" says Stephen Miles,
CEO of The Miles Group. "Even the best-of-the-best CEOs have their
blind spots and can dramatically improve their performance with an
outside perspective weighing in."
More than 200 CEOs, board directors, and
senior executives of North American public and private companies were
polled in the 2013 Executive Coaching Survey that Stanford University
and The Miles Group conducted this spring. The research studied what
kind of leadership advice CEOs and their top executives are — and aren't
— receiving, and the skills that are being targeted for improvement.
Key findings from the survey include:
Shortage of Advice Exists at the Top
Nearly 66% of CEOs do not receive coaching
or leadership advice from outside consultants or coaches, while 100% of
them stated that they are receptive to making changes based on
feedback. Nearly 80% of directors said that their CEO is receptive to
coaching. "If CEOs are willing to be coached and make changes based on
coaching, it stands to reason that companies and boards should make this
happen," says Professor Larcker.
CEOs are Looking to be Coached
When asked "Whose decision was it for you
to receive coaching?" 78% of CEOs said it was their own idea. Twenty-one
percent said that coaching was the board chairman's idea. Miles sees
this as a positive trend: "Becoming CEO doesn't mean that you suddenly
have all the answers, and these top executives realize that there is
room for growth for everyone. We are moving away from coaching being
perceived as 'remedial' to where it should be: something that improves
performance, similar to how elite athletes use a coach."
Coaching "Progress" is Largely Kept Private
More than 60% of CEOs responded that the
progress they are making in their coaching sessions is kept between
themselves and their coach; only a third said that this information is
shared with the board of directors. "As coaching is starting to lose its
stigma, more of this secrecy is being removed," says Miles. "Although
much of the coaching discussion should be treated confidentially,"
Professor Larcker adds, "keeping the board informed of progress can
improve CEO/board relations."
How to Handle Conflict Ranks as Highest Area of Concern for CEOs
When asked which is the biggest area for
their own personal development, nearly 43% of CEOs rated "conflict
management skills" the highest. "How to manage effectively through
conflict is clearly one of the top priorities for CEOs, as they are
juggling multiple constituencies every day," says Miles. "When you are
in the CEO role, most things that come to your desk only get there
because there is a difficult decision to be made — which often has some
level of conflict associated with it. Stakeholder overload is a real
burden for today's CEO, who must deftly learn how to negotiate often
conflicting agendas.
Boards are Eager for CEOs to Improve Talent Development
The top two areas board directors say
their CEOs need to work on are mentoring skills/developing internal
talent and sharing leadership and delegation skills. "The high ranking
of these areas among board respondents shows a real recognition of the
importance of the talent bench," says Professor Larcker. "Boards are
placing a keener focus on succession planning and development, and are
challenging their CEOs to keep this front and center. However, there is
still a long way to go in the area of succession planning for most
companies, especially as you get further down the reporting structure."
Top Areas That CEOs Use Coaching to Improve
- Sharing leadership/delegation
- Conflict management
- Team building
- Mentoring
Bottom of the list:
- Motivational skills
- Compassion/empathy
- Persuasion skills
"A lot of people steer away from coaching
some of the less tangible skills because they are uncomfortable with
touching on these areas or really don't have the capability to do it,"
says Miles. "These skills are more nuanced and actually more difficult
to coach because many people are more sensitive about these areas.
However, when combined with the 'harder' skills, improving a CEO's
ability to motivate and inspire can really make a difference in his or
her overall effectiveness."
Stanford University's Rock Center for
Corporate Governance and Miles have collaborated on several research
studies of CEOs and board directors, including the recent 2013 Survey on
CEO Performance Evaluations, the 2011 Corporate Board of Directors Survey, and the 2010 Survey on CEO Succession Planning.
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