5 things that make executive teams powerful
The executive team is healthy and aligned (Rockefeller Habit #1)
You’re an ambitious CEO with your sights set on growth. You want to scale up and need a plan to get there. My advice? Start by looking at your executive team. If there are any cultural issues in the business, you can bet the core of the problem is at exec level.
When I’m coaching clients, I ask them to talk me through how their top team performs. They almost always come at it from an operational perspective. I’m not ignoring the importance of operational excellence, but something important gets missed. That’s the cultural piece. Don’t forget, your executive team casts a long, cultural shadow in your business. I firmly believe that the difference between a good executive team and a great one lies in the positive culture it creates.
So, what makes an executive team powerful? What are the things they do that set them apart?
Put the exec team first
It’s a given that your executive team buys into the purpose and values of your company. If they don’t, what are they doing in your top team? They’re in the wrong company! But every one of them also needs to understand that their personal success depends on the success of the executive team as a whole. This is what makes a good team great. Putting the exec team first, over and above any individual operational goals. Team members may head up key departments, holding significant roles and responsibilities but their individual achievements must be secondary to those of the executive team.
My advice is to ensure that some, if not all, remuneration and performance bonuses are paid at team level. If executives are only rewarded according to departmental success, it can get in the way of harmony in the team, setting up competition and conflict. Levels of cortisol rise as fight or flight kicks in, becoming the default way of operating. This really gets in the way of collaboration. If someone says they’re not happy with progress, what they’re really saying is they believe they’re better than their colleagues. You don’t want this attitude to creep in. If there’s a failure to deliver, the whole team needs to be accountable. Any problem that crops up becomes the whole team’s problem.
Keep score (all the time)
NPS®, Q12, KPIs, OKRs… the acronyms are endless! There are so many tools out there that high functioning teams use to keep score. Embed these into the way your team works and you’ll have a strong foundation of benchmarks on which to build.
Let’s imagine you’ve got your BHAG (another acronym meaning Big, Hairy, Audacious Goal) sorted for the business as well as your purpose. What then? Time and again, I see senior level team members avoiding treading on each other’s toes. The Head of Software Development isn’t going to challenge the Sales Lead because they don’t feel it’s their job to do that. Also, they don’t want anyone treading on their own toes! This is what happens when goals aren’t shared.
I’m a big fan of OKRs (objectives and key results) within a 90-day cadence. Eventually, these can be rolled out across your company but the place to start is at the top. They’re by far the best way for your executive team to keep score and can be used to give cross-functional accountability. Because your customers experience your service or product by moving through multiple departments, it’s vital that this cross-functional process is owned at executive level.
When I coach exec teams, we work on OKRs together. It’s like building a new muscle. Often, this will be the first time teams have worked together to help each other define goals and it’s so valuable. The process of defining OKRs builds trust and vulnerability in the team, particularly when they have to mark each other’s homework. Instead of giving individual presentations on departmental objectives, team members help each other to write their OKRs.
Collectively, they work out the most important things they need to achieve over the next 90 days and what part each member will play. These are stretch targets, meaning there’s a 70% likelihood of success and you’re not going to sandbag the goal – that’s what’s so great about them!
Here’s a recent example. One of my clients knows they’re going to need more managers to hit their three-year financial targets. Within the next six months, they can see a tipping point where they’ll run out of staff with management experience in their organisation. They’re keen to promote from within so they’ve decided their OKR for this quarter is to build a management development programme. In the past, it wouldn’t have been anyone’s job to manage this but, as part of the OKR process, one of the team has taken ownership and is accountable for delivery. This is how you move from running your company on a functional basis to a cross-functional, matrix approach where the focus is on customer value creation.
Build psychological safety
‘There is no team without trust’ – a great quote by Google’s Head of Industry, Paul Santagata. It’s so true. One of the main characteristics of high performing teams is they build a culture of psychological safety. This may sound easy but it’s actually deceptively hard. Every member of the team needs to make it a priority and it takes deliberate practice before it becomes ingrained.
In great teams, there’s a real awareness of each other’s strengths and weaknesses. People feel comfortable asking for help and showing weakness in a way they’ve never done in previous workplaces, where the culture is more dog-eat-dog. It’s so important to get people to play to their strengths and offer each other support to overcome weaknesses. We’re all human!
When Gary Sherlock took over as CEO of Peer 1 (where I was MD), he immediately prioritised the creation of psychological safety in our executive team. We were spread across two continents, three countries, in five different cities. A logistical challenge! Yet he succeeded in his goal by ensuring we all got together for a week every quarter to work on our relationships and not the business. I’m certain this was central to our transformation of the business, taking us from $90 to $200 million in 5 years.
That time together was so valuable. Instead of staying in hotels, we’d hire a house and live together. We’d cook for each other, hang out together and really get to know and understand each other. This fundamentally changed the dynamic of the team. You have to make this stuff happen and as CEO, you need to be prepared to do it yourself! Hats off to Gary. I wish I’d learned this years before.
Zero tolerance of negativity
Hand in hand with psychological safety is a commitment to reject triangulation. High functioning teams steer away from negative conversations about people behind their backs. They commit to open, honest communication and peer coaching.
Don’t underestimate how powerful this can be. Once an executive team has mastered this, it can be rolled out to the rest of the company, banishing corrosive attitudes and encouraging positivity.
And if someone in your SLT can’t commit to this? Then they have no place in your company. You’re trying to drive behavioural change to create a high performing team. You need total buy-in.
Review their performance
Every high performing team, whether in sport or business, knows the importance of looking retrospectively at performance. In rugby, players wear state-of-the-art devices tracking individual collisions and analysing every scrum. When they come off the field, they can review together how many passes and tackles they made and what their individual contribution was to the team’s performance.
This should be a regular part of the weekly rhythm of your executive team. Retrospectives allow the opportunity to talk openly about success and failures as well as learning from each other and growing. If there’s psychological safety in the team, people will feel comfortable sharing mistakes.
I’m reading a great book at moment, ‘Fearless Organisation’ by Amy Edmondson. She describes a situation where the best performing hospitals are the ones who reported the most mistakes. Counter intuitive? Well it actually demonstrates that where there’s psychological safety, there’s no fear of raising mistakes. Staff in these organisations see mistakes as an opportunity to correct a process and criticism as an opportunity to grow.
I’ll never forget our ‘Cut the Cr*p’ meetings at Rackspace. Every week, we’d go through instances where customers had been compensated for our cock-ups. By examining them honestly, without fear of any blame, we’d quickly get to the root cause and fix it.
Great executive teams know where they’re going and have a shared sense of momentum. They understand that mutual trust is vital and build psychological safety by communicating openly and constructively. The result is a strong and powerful culture that can drive change with speed and agility – essential ingredients for any business looking to scale-up.
Written by business growth coach Dom Monkhouse. Find out more about his work here.