CEO turnover is on the rise across corporate America. The number of top executives who have left their jobs in 2018 has reached a 10-year high, according to outplacement firm Challenger, Gray & Christmas.
Reasons for the trend vary, the firm says, from natural movement in a tight labor market, to economic uncertainty, to a desire by companies, in light of #MeToo, “to let go of leaders that do not fit their culture or otherwise act unethically.”
Whatever the causes, the high turnover has an interesting side effect: more opportunities for executives seeking their very first CEO gigs. These vice presidents, general managers, chief financial officers, et al, typically have spent years working toward a shot at the top spot. The current direction toward fresh blood in the corner office means more can get there.
And yet most have no idea about the challenges they’ll encounter.
It’s a subject close to my heart. After several years in leadership roles at Salesforce and Oracle, I became a first-time CEO at a smaller tech company in fall 2015. I left at the beginning of 2018 as part of a corporate restructuring that would have required me and my family to relocate. Five months later, I landed my second CEO post, at another tech firm.
The first realization that smacked me in the face as a rookie: It’s a really hard job. I had naively thought being CEO would be only incrementally more difficult than other positions I’d held. Running a business unit within a company carries a lot of responsibility, right?
Yes, but it’s not even close to the same. As CEO, the buck stops here on company success (or lack thereof), culture, brand satisfaction, product quality, funding, communication with the board of directors, and a host of other priorities that don’t really sink in until you’re in the big chair. It’s all a huge thrill, but it also requires a massive adjustment in how the freshly minted CEO thinks and acts.
I reflect frequently on the lessons I learned as a first-time CEO and how I can apply them at my new company. Here are six of the most important ones, in no particular order.
1. You’re under a microscope. Get used to it. On my third day as a CEO, I visited one of our offices. A manager in one of the groups had emailed me that he’d love to get together over coffee and share some ideas. He just happened to get to me before anyone else. I replied, “Sure, let’s do it.”
Within an hour, everyone in the office of 130 people knew I had gone out for coffee with this guy as one of my first acts as CEO. It was seen as a huge stamp of approval for him and his ideas. I thought I was just meeting a new employee.
The lesson: As a new CEO, everything you do or say, big or small, is magnified. Everyone in the company notices everything. A successful CEO recognizes this and uses their bully pulpit wisely, deliberately, and selectively.
2. It can be lonely. For the first time in their career, a new CEO doesn’t get to commiserate with other people in the company. Because of the microscope effect, if the CEO says something to one person, they must assume they’re saying it to everyone. They can’t, for instance, grab a beer with the head of products and complain about the head of sales. Inevitably, the comments will get out, and the sales leader will never recover. This reality is a hard adjustment for some new CEOs.
The lesson: A CEO will often feel like Tony Soprano. To paraphrase the mob boss from the hit HBO show: “You’ve got no idea what it’s like to be Number One. Every decision you make affects every facet of every other thing … And in the end you’re completely alone with it all.”
3. You have to walk the walk, not just talk the talk on transparency. My first CEO gig was with a company experiencing business challenges. I kept repeating the message to employees that we were going to turn this thing around. I’m not sure, however, that I was transparent enough about the facts of the situation and specifically why I felt some areas were broken. I could have built more trust by sharing more.
At my new company, I put up a dashboard at our monthly all-hands meeting with all 260 employees. It’s the same one I use with the executive team and the board. It has all the numbers and facts that show how the company is performing and how we need to.
The lesson: The first step in a transparent culture is, well, transparency. It’s the CEO’s job to make sure employees are given sufficient information so they’re not just along for the ride but truly are part of the ride.
4. You’re going to be busier than you’ve ever been. Deal with it. The amount of time CEOs spend watching over the business, meeting with investors and potential ones, talking with the media, etc., can be staggering. A first-time CEO must learn quickly that they can’t allow the calendar crush to steal their approachability. “I’m so busy” are words that can never slip from a CEO’s lips.
Instead, they find ways to maximize their time. For example, I hold all-hands meetings with an open Q&A. I’ll spend a morning with, say, the customer support team as they work, to see their challenges first hand and to listen. I’ve even been known to sit in the break room with my laptop, chatting up everyone who walks in. I also send a weekly email highlighting what I feel are top accomplishments, activities, and priorities.
The lesson: Most CEOs are outgoing and approachable by nature, but if they’re not careful, the demands of being CEO can make them significantly less approachable. They can’t allow themselves to fall into that trap.
5. Balance strategy and execution. While it’s the CEO’s job to set a strategic direction for the company, he or she can’t lose sight of execution. One of the first things I did in my second CEO gig was establish a team of 30 people – not just my direct reports but other leaders responsible for execution – and we meet twice a month to examine business operations and make sure execution is aligned with strategy.
The lesson: CEOs must consistently insert themselves into the execution conversation.
6. Set the right example for work-life balance. At 4 PM every Tuesday, I leave work to coach my kids’ youth hockey team. It’s an inconvenient time for a CEO to step away, but my family is my No. 1 priority. I explain to employees why I do this, how technology allows me to time shift my work to later at night, and that they are entitled to the same flexibility.
The lesson isn’t “work hard, play hard,” which sounds like a fraternity-type culture. It’s reinforcing the message that employees don’t need to be sitting on email from 4 to 5 if their kid has soccer practice. Go be with your kids and catch up on work later in the day. What’s good for the CEO is good for everyone else.
According to LinkedIn, 12,000 of its members share the title of CEO at companies with more than 50 employees. CEO is an exclusive club, and it can be daunting for those entering it for the first time. But by knowing what they’re getting into, and exercising the strong judgment and careful thought that got them to the top spot in the first place, rookie CEOs can knock it out of the park.
Andy MacMillan is CEO of UserTesting, a human insights platform.