Rise and Fall of Sri Lankan CEOs

The CEO’s position in an organization is the sexiest, flamboyant and the apex point one could reach in the corporate ladder promising to deliver business results and accelerate the company to greater heights. The position comes with substantial empowerment and demands high accountability to deliver business results and create a culture of high performance. Today many young business leaders with proven track records and business acumen aspire to reach this alluring position during their career span. The first 100 days of a new CEO is so crucial to understand and fathom the new organization culture and make decisive moves to make changes required and align the capabilities and resources to achieve the organizational vision.

Well empowered and governed boards do not spare a non performing CEO to remain due to flawed strategies and poor execution capabilities. This compels the CEOs to stretch abilities beyond the norm and create layers of leadership cultures where one instigates the drive for performance excellence, recognition of available capabilities, nurture them in order to instigate creativity and innovation to drive sustainable performance cultures.

One should note that when companies perform at usual growth rates driven by trends in the business climate the shareholders would hardly want to find out who is running the business as this important role in any case is charged with responsibilities to deliver results even in complex and uncertain business climates. On the contrary if the organization is not performing at the rate of growth forecasted and results fall below previous years compelling the organization to declare lower dividends it is then the shareholders tend to find out with extreme curiosity who is sitting in the CEO’s seat and the position comes under extreme vigilance and every move the CEO makes get noticed.

However in the recent past Sri Lanka has seen the downfall of some of the talented and very experienced CEOs. Can one attribute the present market uncertainties and the ambiguous environment as the major reasons contributing to the poor performance of experienced CEOs or is it the leadership capabilities they demonstrated that flung these celebrity personalities from the apex leadership positions they were holding? Or can the unforgiving VUCA factors lead to the failure of the top man in the organization?

 Past experiences and observations suggest that it’s easier for high potentials to get to the CEO seat if one demonstrated great business acumen and characteristics of a potential CEO but its rather difficult stay there as profoundly the primary and the most paramount task of a newly appointed CEO is the requirement to deliver results of topline and bottom lines meeting stakeholder aspirations especially of the shareholders irrespective of the complex business landscape.

During my company’s experience of leadership profiling and performance coaching of experienced CEOs a key observation has been that there is a significant correlation between the inability to create collaborative cultures and the absence of a people strategy that lead to poor performance. Some CEOs are highly driven, task oriented and ambitious to achieve results and use the element of controlling as a tool to articulate their journey with a good business strategy. However despite the presence of a great strategy the leadership endlessly struggled to execute strategy well due to the lack of ownership by stakeholders involved as they pull in different directions. They ignore early warnings of such trends within the capabilities and continue to tread in tougher terrain dragging the business performances down.

The DNA of an effective CEO must focus on the following

  • CEOs should be mindful not to expect his key leadership team members to compromise professionalism and to seek personal loyalty.
  • Creation of a strong people strategy to align with the business strategy.
  • Must instill process changing initiatives that drive business growth with stakeholder collaboration.
  • The focus must be on few big initiatives with great clarity and this must engage all stakeholders to contribute in executing the strategy.
  • A culture of trust must be created where key members are empowered to challenge the norms and the status quo.
  • A culture of collaboration must be nurtured with extreme accountability for performance initiatives
  • The results should be measurable and should not create confusion and chaos amongst key leadership team members.

A new CEO must identify the capabilities and competencies of people inside the organization before embarking on a pursuit of boarding allies and friends on to the bus from his own networks. If this move is not attributed to incremental business performance the CEO stands a very high chance of risking his leadership position and could lead to create a culture distracting all collaborations from the competent people in the organization that could have otherwise helped turnaround the organization. Maintaining fierce focus on accelerating business performance and creating a culture of collaboration for performance sustainability emerges as a dominant task in this context together with effective leadership behaviors of passion, vision and of high character.

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