How to Ensure Success as a New CEO: Unearth Organizational Insights through AI
Like anyone else, new CEOs have one shot to make a good first impression. The difference for transitioning C-suite executives, however, is that everyone is watching. Board members, investors, employees, competitors and to some extent, even customers, are closely observing their every move. They have a lot at stake, especially when early decisions can end up making or breaking a successful tenure as CEO. So, how can they ensure that their transition is successful? How can they come up to speed on an entire organization as quickly as possible?
What Really Matters to a Transitioning CEO
In modern business, an increasing number of new CEOs are recognizing the imperative need to understand the internal health of the organizations that they have stepped in to lead. In the past, new executives would immediately turn their undivided attention to external pressures, such as competitive threats or boardroom expectations. Fortunately, this old-school approach is gradually fading. In fact, according to a Forbes article written by David Michels and Patrick Litré of Bain Insights, the positive impact of organizational insights is already apparent. According to their research, leadership teams that quickly assess internal organizational risks are nearly twice as likely to achieve transformational success. What’s more, 80 percent of leaders who achieved transformation goals acknowledged the importance of internal factors in their success.
Transitioning CEOs also need to know who they can trust. This is critical, as the execution of any transformation or strategic plan relies upon people within an organization to drive it forward. So, which people can (and should) a new CEO tap into in their early days on the job?
As it turns out, this is a pretty difficult question to answer. Ken DiPietro, one of our strategic partners, put it like this:
“I often say that the first friend of a new CEO is the truth. It’s hard to get it because when you’re an executive, it’s often hard to find out what’s going on.”
This is one compelling reason that many new leaders turn to cutting-edge tools and technologies to help accelerate and enable the onboarding process. With the right tools, new executives can understand what’s going on and who to trust. They can get to the “truth” about their organizations in a way that’s easier, faster and cheaper.
Common Pitfalls for New CEOs
As a leader in organizational health diagnostics, we primarily support M&A efforts, large-scale transformations and new CEOs in the mid-market private equity space. However, regardless of their industry, there are a number of pitfalls that are common to the vast majority of new executives.
These are the type of seemingly-harmless mistakes that new CEOs tend to make, ultimately derailing a successful launch into their new role:
- Neglecting to deeply understand the comprehensive health of their organization
- Relying on incumbent senior leaders and their immediate team to provide an unbiased assessment of the organization
- Failing to capture the input of non-senior staff and front-line employees with regard to the organization’s strengths, opportunities and risks
- Basing their assessment of their senior team’s strengths solely on first impressions, without integrating feedback from multiple levels of the organization
- Failing to confirm “gut instincts” with quantitative and qualitative data points
- Delaying the identification of key influencers at all levels of the organization that can serve as critical drivers of change
- Failing to get buy-in from the board and missing out on the opportunity to use data to guide early strategic planning
- Taking too long to address necessary senior leadership changes in order to establish a strong team that will effectively support and enable their initiatives
How Artificial Intelligence Can Empower New CEOs
Recently, we supported a CEO that was transitioning into a new role. While he was an internal appointment as opposed to an external hire, his team was anything but a well-oiled machine. Many of the senior leaders had just recently joined the company, and many were new to senior leadership roles altogether. Additionally, there were hard-to-ignore tensions within the broader organization. The company spanned multiple locations, with newly-formed teams and positions, and had recently undergone rapid (and rocky) growth.
Our technology was deployed to help assess and improve three critical areas of the business:
- Overall health of the organization
- Collaboration across teams and locations
- Dynamics, strengths and weaknesses of the untested senior leadership team
In addition to these three specific areas of focus, the new CEO was hoping that the diagnostic process could also help make sense of other, lingering questions that seemed to permeate the organization: How had the period of tumultuous growth impacted employees? How confident were the employees in the direction of the company? Where should the company invest: technology, strategic teams, or in their offices?
With the help of artificial intelligence (AI) and natural language processing (NLP) capabilities, the new CEO was able to address his concerns about the business. Insights from the diagnostic revealed that the company’s offices acted as siloed organizations, struggling to coordinate with one another. The rapid growth of the business had damaged workforce morale, with employees expressing that they felt the need to be online and available around the clock. Finally, the diagnostic showed that employees were confused about the overall direction of the company itself.
Without AI and NLP, these insights would only have been possible through the execution of interviews, focus groups and one-on-one meetings over the course of weeks or months. Instead, a full organizational health diagnostic, along with strategic recommendations for improvement, was completed in less than two weeks.
Create a Lasting Leadership Legacy
In a competitive marketplace, new CEOs don’t have time on their side. They need to uncover the truth about their organizations – what’s not working, where the opportunities are, how the workforce is feeling and who the key influencers are – sooner rather than later. New tools rooted in AI and NLP offer a means to accomplish this quickly and effectively. In fact, in PwC’s 2019 US CEO Agenda, it states that 80 percent of US CEOs believe that AI will significantly change the way that they do business in the next five years.
As such, new CEOs can’t afford not to take advantage of these capabilities now. With AI tools, leaders can master the historically high-risk transition period and quickly uncover opportunities within their organizations. For new CEOs determined to create a lasting leadership legacy at their companies, this is the path to get them there.