PDF Summary:CEO Excellence, by Carolyn Dewar, Scott Keller, and Vikram Malhotra

How do the world’s top CEOs run their businesses? What do they all have in common? These are the questions that Carolyn Dewar, Scott Keller, and Vikram Malhotra sought to answer when they interviewed 67 highly successful CEOs and compiled their findings into CEO Excellence. By doing so, they’ve created a unique guide to help you emulate the mindsets and practices of some of the best business leaders on the planet.

The authors say the best CEOs are those who can effectively balance six mindsets. This guide condenses those into three key areas: running a company’s operations, dealing with people (ranging from your board of directors to your customers), and taking care of yourself while still taking care of your company.

Throughout, our commentary offers advice from other leadership experts like Patrick Lencioni (The Five Dysfunctions of a Team), Simon Sinek (Start With Why), and Robert K. Greenleaf (Servant Leadership).

(continued)...

To build that atmosphere of trust and collaboration, the authors first recommend that you practice radical transparency with your board of directors. This means you proactively share both positive developments and problems as soon as they arise. In addition to establishing trust between you and the board, such openness serves two more purposes: It stops directors from wasting time looking for problems you’ve hidden from them, and it ensures they can take action while issues are still manageable.

It’s also helpful to cultivate personal connections with each of the directors. To do so, learn about each one’s area of expertise, strongly held beliefs and values, and communication preferences. Also, whenever possible, have one-on-one conversations with board members to get their input on important issues and share your perspectives in turn. These practices help strengthen the bonds between you and your board, leading to more effective teamwork and better outcomes for your organization.

Strengthen Working Relationships With Radical Candor

Building strong connections through honesty and transparency is the main theme of Radical Candor, by entrepreneur and CEO coach Kim Scott. While her book is about managing your subordinates (rather than working with a board of directors that has the authority to remove you), Scott’s practices of receiving and giving radically candid guidance can still apply here.

Asking for radically candid guidance: Start by asking for feedback from the board to show that you’re not afraid of brutal honesty. Ask specific questions based on what they tell you, such as “What am I doing that frustrates you?” Get detailed replies—if they brush it off as no big deal or try to get away with a vague answer, gently push them to share their real thoughts. When you do get criticism, listen closely and don’t be defensive. Instead, show you appreciate their honesty by sharing how you intend to act on their feedback, or explaining why you’re not able to. All of these practices will help you learn more about the board members and build working relationships with them, as Dewar, Keller, and Malhotra urge you to do.

Giving radically candid guidance: When reporting on developments in your organization, don’t focus on personal traits like “initiative” or “carelessness.” Instead, focus on events: what actually happened and why it was positive or negative. Give such information as soon as possible—and, in the event that you’re sharing bad news, make it clear that you’re trying to fix a problem rather than to embarrass or undermine anyone. These practices help you come across as humble, helpful, and direct—and as Dewar, Keller, and Malhotra note, this helps you not only build trust with directors but also support the board’s ability to act constructively.

Stakeholder Relations

Maintaining good relationships with your board is crucial, but Dewar, Keller, and Malhotra say that it’s equally important to maintain good relationships with all of your company’s stakeholders, from executives to customers.

The best way to do this is to create a meaningful, inspirational vision for your organization: something you can hold up as your ultimate goal and the reason why your company exists. This will create more authentic and productive relationships with all of your stakeholders because people who believe in your vision will believe in you, and therefore in your company as well. A strong, unique vision will also help set you apart from your competitors.

To develop such a vision, look for places where the market’s needs, your company’s capabilities, and your personal passions overlap.

(Shortform note: In Start With Why, Simon Sinek argues that establishing clear goals, standards and values—what Sinek calls the company’s “why”—is actually the first thing you should do, long before worrying about issues like business strategy and logistics (the company’s “what”). Without a strong “why,” confusion and disorganization will arise, and stakeholders will lose their motivation and dedication. Sinek calls this phenomenon “the split.” He further explains that companies are at the highest risk of the split when leaders become disconnected from the “why.” This might happen if leadership loses sight of the organization’s purpose, or if they’re replaced with people who don’t share their dedication.)

The authors add that you can prove your commitment to your vision by also working to address other environmental, social, or political challenges, even if they’re not directly related to your ultimate goal. As with your overarching vision, you’ll have to identify where people’s needs align with your organization’s strengths.

For example, the Walt Disney Company’s mission is to “..entertain, inform, and inspire people around the globe through… storytelling.” As an offshoot of that overarching vision, the company invests in a wide variety of philanthropic projects to support people’s health and happiness all over the world.

(Shortform note: The authors list personal passion as an element of your company’s vision, but that’s not necessarily the case with these secondary challenges. In Purple Cow, marketing expert Seth Godin says there are two ways to simulate passion when you don’t genuinely feel it. The first is to study and talk with people who are passionate about that issue, then do what they would want you to do. The second is to follow the more traditional strategy of trying something, then using hard data and personal feedback to refine your approach. This simulates passion because you have to care more about the results than about yourself, and therefore act on the feedback even if it conflicts with your own ideas or your ego.)

Align Company Culture With Company Vision

Your company’s vision will inspire excitement and trust among most of your stakeholders. However, remember that employees are stakeholders as well—Dewar, Keller, and Malhotra say that keeping your workers engaged and committed requires you to create a workplace culture that meets their personal needs.

(Shortform note: Many organizations like Nordstrom, W.L. Gore, MARS, and Rocket Companies have created cultures based on shared values to empower employees and create purpose-driven work environments. The leaders of these organizations say that their values-driven cultures, in addition to boosting employee engagement, have proven more efficient and more effective than traditional workplace cultures that rely on control and compliance. This is largely because it’s impossible for company leadership to be directly involved in every decision, especially at big corporations. Giving workers the guidance and autonomy to make their own decisions neatly solves that problem.)

The authors offer some advice on strengthening your company culture. First, choose a cultural anchor—a single, powerful focal point for your company culture. This is a similar concept to the “inspirational vision” the authors discussed before, but less specific; a cultural anchor is a concept or a mindset, rather than a concrete goal. It should be emotionally moving, logically connected to your company’s performance, and simple enough that everyone from C suite executives to frontline employees can use it to guide their decisions. .

For example, suppose you choose “respect” as your cultural anchor. That single word could encompass respect for every member of the organization (regardless of position), respect for oneself, respect for customers, and even respect for the world as a whole—which implies that social and environmental responsibility are also part of the company culture.

The authors urge you to involve leadership from every level of the organization in choosing your cultural anchor. Doing so will ensure that it authentically connects with the company’s strategic and cultural needs.

(Shortform note: One real-world example of an effective cultural anchor can be found at software company Salesforce. As Salesforce CEO Marc Benioff explains in Trailblazer, his company’s cultural anchor is ohana, a Hawaiian word meaning “family.” This anchor unites Salesforce employees with other stakeholders, like customers and partners, by framing every interaction as part of a larger community. But when stakeholders perceive their company as falling short of its stated ideal, as when Benioff reportedly deflected questions about mass layoffs in an all-hands meeting, the disconnect can create frustration and distrust. It’s important to adopt a cultural anchor you can embody authentically and consistently—as Dewar, Keller, and Malhotra suggest, consulting with leadership at every level can help you do this.)

Once you’ve chosen your anchor, the authors say you must make sure your company culture aligns with it. You can do this in four ways:

1) Pay attention to people’s stories about their experiences with your company as employees, customers, or any other role. The authors say to celebrate and share examples that demonstrate the values you want to promote, while letting stories that go against your new culture fade away on their own. Don’t try to suppress negative stories, as that will only call more attention to them.

(Shortform note: The stories people tell about your company or products can be valuable sources of information and inspiration, but only if those stories are genuine. Unfortunately, review bombing—coordinated campaigns where large numbers of people post negative reviews of products that, in many cases, they’ve never used—is an increasingly common practice. In such cases it’s best to take action, rather than hoping the situation will fade away naturally, as the authors suggest. This involves actively monitoring, moderating, and responding to negative reviews. Of course, if a review bombing campaign is rooted in a real problem with your product, you will also want to acknowledge and fix that issue.)

2) Make sure the company’s daily processes and reward systems support the culture you’re trying to create. For example, if you’ve chosen honesty as your cultural anchor, but only reward employees based on sales, your workers will quickly realize that it’s better for them to tell whatever lies are needed to make a sale. This is a clear mismatch between what you claim to value and what your company actually values.

3) Embody the culture you want the organization to adopt. Your employees watch everything you do and look for clues about what really matters to you, not just what you say in meetings. Therefore, the authors advise you to always live up to the values you promote, especially when doing so involves some level of personal risk or sacrifice. Furthermore, if and when you fall short of those ideals, candidly acknowledge your failure and your need to improve; such honest vulnerability will show your employees that you’re making the same changes you’re asking them to make, and facing the same struggles. This is similar to being honest with your board and will produce many of the same benefits.

(Shortform note: How well your employees embody the company culture is, in many ways, a reflection of how well you embody it yourself. There’s a parallel in parenting: in 13 Things Mentally Strong Parents Don’t Do, psychotherapist Amy Morin says many parents lose sight of their big-picture values because they get caught up in the constant demands of everyday life. As a result, their children don’t learn the values they intended to teach. While being a CEO is obviously not the same thing as being a parent, this lesson still holds true: If the people you’re responsible for don’t demonstrate the values you want them to, your own day-to-day behavior is a good place to start looking for the source of that disconnect.)

4) Help people feel confident about learning and living the new work culture. This means giving them the training and tools they need to succeed. It’s also crucial to create an environment where employees feel safe trying new approaches to their work, and aren’t afraid they’ll be punished for making honest mistakes.

(Shortform note: The authors urge you to create a culture that tolerates mistakes and failures. In Right Kind of Wrong, Amy Edmondson says you should go a step further: Create a culture that embraces and rewards failure. You can do this by analyzing each failure with the people involved in it to determine what went wrong and how to avoid that problem in the future. She also suggests that you publicly praise “good failures”—situations wherein the value of the lessons learned outweigh the cost of the mistake.)

Key Area #3: Self-Care

So far we’ve been discussing how to manage your various responsibilities to your company, but Dewar, Keller, and Malhotra urge you to remember that you also have responsibilities to yourself. They write that many executives overlook the importance of self-care, which is a critical mistake—your well-being is crucial to both your effectiveness as a CEO and your personal happiness. In this final section, we’ll discuss two strategies that can help you protect your physical and mental health: effectively managing your time and attention, and having a strong sense of identity.

Manage Your Time and Attention

Dewar, Keller, and Malhotra assert that the demands of a CEO position, and the schedule required to meet those demands, are often overwhelming. It’s therefore crucial to effectively manage your time and energy to avoid exhausting yourself. Approach your role as a series of short but high-intensity working periods, and deliberately leave yourself periods of rest in between.

(Shortform note: In Feel-Good Productivity, entrepreneur Ali Abdaal expands on the need to manage your time and energy to avoid burnout. Notably, Abdaal says that you can burn yourself out both by working too much and by not resting enough, and that those are two separate issues. To illustrate the distinction, think of work as physical exercise: if you push yourself too hard during a single gym session, you risk injuring yourself. On the other hand, if your individual workouts are reasonable but you do them too often—not giving yourself enough time to fully recover—you can suffer from constant exhaustion, soreness, and reduced performance.)

The authors say that when making your schedule, you should balance structure with flexibility. Start by scheduling your most important commitments, then build the rest of your calendar around those. Since it’s impossible to predict everything your job will entail during any given day, week, or month, it’s wise to leave yourself blocks of time when you have nothing specific scheduled. Those free periods are chances for you to pursue unexpected opportunities, catch up on tasks you’ve been neglecting, or simply to take time for yourself and rest.

It’s also crucial to bring your full attention to whatever you’re currently doing. Thinking about what’s already happened or worrying about the future not only distracts you from the task at hand, it also drains your already-limited mental energy. Similarly, it’s important to establish clear boundaries between your professional and personal life so that you (and your loved ones) can fully enjoy your time away from work.

Plan Your Schedule Using the Freedom Compass

The authors provide general advice about how to manage your time and energy, but few actionable specifics. In Free to Focus, productivity expert Michael Hyatt offers a useful tool to help you balance your responsibilities—including your responsibilities to your loved ones and your own well-being—which he calls the Freedom Compass.

You use the Freedom Compass to categorize your tasks, both personal and professional, based on your personal interest and skill. Therefore, you end up with four different zones: neither interested nor skilled, skilled but not interested, interested but not skilled, and finally both interested and skilled.

Hyatt’s point is that you should spend as much time as possible in that fourth zone (interested and skilled), which he calls the Productivity Zone. Those tasks will naturally hold your full attention because you enjoy doing them. Plus, you’ll do them efficiently and well because you’re good at them. So, by building your schedule around Productivity Zone tasks as much as possible, you can handle all of your personal and professional responsibilities, and still leave yourself space for the free periods the authors suggest.

Remember: You Are Not Your Company

To protect your mental and emotional well-being, make sure you don’t turn your role as CEO into your whole identity. In other words, remember that running a company is what you do, not who you are. Dewar, Keller, and Malhotra offer several strategies to do this.

First of all, make a point of having relationships outside of work that can help you stay grounded. Family, friends, hobby groups, and spiritual communities all offer chances for you to step outside of your role as the ultimate authority and remember that you’re just another person. In addition, those relationships are enriching experiences in their own right.

(Shortform note: In How to Get Rich, self-made millionaire Felix Dennis also advises you to maintain relationships outside of work. However, he adds that you should prioritize relationships you already had before you became rich—or in the context of CEO Excellence, before you became a CEO. Dennis argues that at this point in your career, new friendships and other relationships may just be people trying to take advantage of you: They’re hoping to ingratiate themselves so you’ll give them money or do them favors. Conversely, your old friends are people you already know you can trust, because they were your friends before you were in a position to do them large favors.)

Second, remember that your company’s accomplishments come from everyone’s collective efforts, not from your own brilliance. Whenever possible, redirect attention from yourself to your colleagues, customers, and your company’s overarching vision. For this strategy, it’s helpful to embrace a philosophy of servant leadership, meaning your first priority is to support your employees’ success rather than pursuing your own.

Finally, keep in mind that your position is only temporary. Someone most likely held the CEO role before you, and someone else will certainly have it after you. The company itself is what produces wealth, helps people, and changes the world; you’re just the person who stepped in to run it for a while.

The Three Aspects of Servant Leadership

Leadership consultant Robert K. Greenleaf developed the philosophy of servant leadership in the 1970s. This approach to leadership addresses what he views as the failures of organizations to meet the needs of their employees and the people they serve.

In his book of the same name, Greenleaf describes three primary aspects of servant leadership: an overarching goal that serves the common good, the ability to inspire people to work toward your vision, and having such a strong desire to help others that you prioritize their needs above your own interests.

The third principle is especially relevant to the points Dewar, Keller, and Malhotra make. If your first concern is for others rather than for yourself, you’ll be much more likely to give credit where it’s due instead of trying to claim your company’s successes as your own. By that same token, you’ll also remember that your organization is much bigger than yourself—it probably existed before you (unless you were also the founder), and it will continue to exist after you step down as CEO.