We’re Doing CEO Feedback Wrong

The annual CEO feedback ritual is largely a waste of time. Three fixes can change that.

Reading Time: 13 min 

Topics

Permissions and PDF

Carolyn Geason-Beissel/MIT SMR | Getty Images

Maybe this sounds familiar: Once a year, your company’s leadership team takes an online survey or participates in individual interviews with the board chair or a leadership adviser about the CEO’s strengths and weaknesses. The resulting feedback is analyzed, prioritized, and then delivered to the CEO by the board chair: “You’re great at setting strategy, but your listening skills could be better.” An action plan is created and, with luck, revisited once or twice.

This standard procedure is largely a wasted opportunity. For one, CEOs generally know their strengths and weaknesses pretty well; they’ve been getting input on them for decades. As one CEO privately told me, “I believe in the value of the process for my employees, but frankly, I don’t get a lot out of it myself.”

Second, the CEO role is, by nature, uniquely broad in its reach, and involves dealing with a wide variety of stakeholders. But this is not reflected in the typical feedback process: Most companies interview only the CEO’s direct reports and the board members, thereby emphasizing the interpersonal dynamics of that small group. The resulting output can quickly feel like an exercise in corporate navel-gazing.

A third, more subtle issue relates to how the raw input is filtered. The CEO typically gets a list of the top three areas for improvement, prioritized based on either frequency (the number of people who said it) or emotional intensity (how strongly someone felt about it). Neither approach centers on the truly important thing: the needs of the business.

As a result, CEOs and boards alike tend to bring an earnest but dutiful “check the boxes” mentality to the feedback process rather than seeing it as a genuine opportunity for change. The perceived lack of value is also reflected in the follow-up process, which tends to be fairly haphazard (or even nonexistent).

There is a better way. During the past two decades, I have worked with CEOs and senior leaders across the globe to experiment with new approaches to feedback and assess which approaches work best. The key to the approach introduced here is to use what I call mission-focused feedback. It starts with either the board, the CEO, or HR leadership recognizing the opportunity and proposing a change to the process. In most organizations, the board chair is the decision maker on that change, but ideally, there is also buy-in from the CEO and HR leaders.

In this article, I’ll share three proven, interlinked ideas that can dramatically increase the impact of your annual CEO feedback process: Start with the company’s mission, not the person; selectively seek feedback beyond the C-suite; and make the follow-up process a shared undertaking.

1. Start with the company’s mission.

Traditional feedback interviews are anchored in the individual: “Given your experience of Yoko, what do you see as her strengths and areas for improvement?” This focus on the person’s professional growth is ideal for early- and mid-career leaders. It allows people to hone their strengths and sand down their rough edges, and it helps position them for greater responsibilities.

CEOs are different. They are already in their end role, and they have had ample opportunity to finesse their leadership style along the way. Some personally focused input is still useful, especially when they are new in the job or transitioning into a new phase of their leadership (for example, as they mature after two to four years from an incumbent into an established CEO). But at a fundamental level, CEO feedback is no longer about the individual’s professional growth; it’s about the company’s growth. All feedback should be filtered through that metric for maximum impact.

In practice, this should already be occurring when an internal or external leadership adviser conducts the feedback interviews (not just afterward, when the output is analyzed). Specifically, when asking people for CEO feedback, it is effective to do so in two stages:

  • Focus on the mission: Start by asking about the feedback provider’s view of the company’s future success. You might ask: “Looking at the next 12 months, what are the top three opportunities and challenges you see for the company? What does that imply in terms of priorities for the company?”
  • Focus on the person: Once the mission is clear, only then should you ask about the CEO’s performance. Make the link explicit: “Based on the priorities you just shared, where do you think the CEO’s actions could have the greatest impact? Looking at their leadership, what should they start or stop doing to deliver on those priorities?”

At a fundamental level, CEO feedback is no longer about the individual’s professional growth; it is about the company’s growth.

The shift in focus can be transformative. It invites the feedback givers to take a more elevated perspective, high above the sordid swamplands of interpersonal friction. And for the CEO, mission-focused feedback provides a much stronger rationale for change. No longer are they being asked to tweak their leadership style because the head of marketing — err, I mean an anonymous source — can’t handle criticism. Instead, changes are clearly linked to a goal they can get behind: making the company succeed.

Here’s a recent example from a leader I’ll call Stefan, the CEO of an asset management firm. From countless feedback processes, Stefan knew that he could be intimidating to people. He saw little need to change that, though; his style worked, as evidenced by his ascent, and the company was growing under his leadership. Compassion had its place, sure — but in Stefan’s experience, people ultimately thrived and grew when their leaders held them to a higher standard. If that came with the occasional gripe about feeling intimidated, so be it.

The mission-focused interviews, however, surfaced a new and important perspective. Identifying and managing risks was a key factor in the company’s performance. But recently, it had been struggling with a pernicious rise in failures of risk management, leading to problems not just with clients but also with industry regulators. As the feedback process made clear, Stefan’s personal style was seen as a contributing factor. Simply put, in the current culture, people were afraid to raise risk concerns with their leaders — not just with Stefan himself but also with his extended management team, many of whom mirrored his tough-love style.

The explicit link to the risk management issue achieved what countless prior feedback processes had failed to do: It made Stefan change his behavior. Stefan started running his team updates in a different manner, explicitly asking them what was not going well and being deliberate about rewarding openness. He also sponsored a series of initiatives that taught the wider employee group how to better deal with power dynamics so that people would feel empowered to escalate risk concerns.

Crucially, this exercise was not about changing who Stefan was. The specific context of risk management called for him to take a more open and encouraging approach. The distinction allowed Stefan to handle the risk issue while still keeping the benefits of his personal style in other contexts. (Here, you might feel tempted to judge Stefan for not making the connection himself — but having power, unfortunately, can diminish your capacity to empathize with others.)

As Stefan’s example shows, connecting CEO feedback to the bigger picture can make a huge difference. The key question to focus on is, how can we level up the CEO with respect to the needs of the company?

2. Selectively expand the circle of feedback providers.

CEO feedback normally comes from a small, usual-suspects group of 12 or so people: the management team and the board. Besides supporting efficiency, the narrow scope of this process offers the perceived benefit of discretion — an unspoken nod to the idea of the CEO as a hallowed figure whose few flaws are best treated as a private affair. (In reality, of course, the CEO’s quirks are a prime and much-enjoyed gossip item across the company.)

CEOs, however, interact with many people beyond their inner circle, and hearing from some of those stakeholders is crucial. While interviewing them all is not viable, a selective expansion of the feedback circle can make a big difference.

This could include individuals in internal roles that relate to strategic priorities for the company, such as the heads of AI, cybersecurity, innovation, customer relationships, internal and external communications, talent, or diversity. Often, the leaders in these roles have good exposure to the CEO while being a few layers removed from them in terms of their reporting relationship.

But the feedback circle can also include external contacts. Consider a financial services CEO who I’ll call Diana. As we put together the list of feedback providers for her, we included a handful of key clients and suppliers from an industry segment that was crucial to the company’s success. From these clients and suppliers came an important observation: Diana and her people were seen as being complacent — and this had been the case for a good while.

Diana, of course, took action to correct this. But it also made her ask a deeper question: “Why haven’t I heard about this before?” The feedback made it clear to Diana that she and her management team had been too isolated from what was happening on the ground — and that problem, more than just the complacency, was the key one to fix.

Who decides on the feedback providers? The CEO and the board chair should agree on the list of candidates, using a decision-making process driven by the company’s priorities. Having said that, company priorities don’t have to be the only criteria, given the fairly marginal cost of adding interviews.

Experiment with going beyond the inner circle when you pick people to share CEO feedback.

For instance, one CEO asked me to include three of her family members in the process, which led to a big insight for her. She had previously been told by colleagues that she could seem a bit aloof and reserved. She hadn’t given it much weight because she saw it as a natural aspect of the CEO role. But the conversations with her family revealed that they, too, felt that she held her thoughts and feelings very close, even in the safety of her own home. As she told me, “It was a bit of a shock to me, frankly. But it was also key in making me realize I had work to do.”

In sum, experiment with going beyond the inner circle when you pick people to provide CEO feedback. Use your company’s strategy to guide the selection, but don’t be afraid to throw in a wild card or two. It is more effort, but given the unique impact CEOs have, the payoff tends to be significant.

3. Use social reinforcement to scale impact.

Even the most on-point feedback is useless if it’s not implemented. To that end, the usual “let’s revisit this in three months” action plan doesn’t cut it. It simply falls by the wayside, given the unrelenting pressures on the CEO’s time and attention. (The same goes for the chair of the board, as owner of the CEO feedback process.)

One effective counter to this is to make parts of the follow-up process social. Drawing on the CEO’s colleagues and others to support the change can help to build a powerful, shared habit of more informal, ongoing improvement.

What can this look like? Consider John, CEO of a consumer goods company. Looking at feedback about John, we first talked about which pieces would be appropriate to share (because not all laundry is equally suited for public airing). He then socialized those pieces in two different ways.

Even the most on-point feedback is useless if it’s not implemented.

With his direct reports, John spent about 10 minutes discussing three key takeaways, explaining why he wanted to prioritize them. Then he asked his team to help him and — crucially — specified how to do so. He didn’t want personal feedback during meetings, he explained; that could too easily become a distraction. Rather, he explicitly gave his team members permission to pull him aside after meetings. It was enough, he said, to just say something like, “Hey, given your goal about engaging in more active listening, you didn’t really invite a lot of input just now.”

More notably, John also decided to share parts of his feedback in a town hall meeting with the wider company.

How he did this is important. He did not want to give a separate talk about his self-improvement; that seemed overly self-indulgent to him, given his personality and the company’s culture. So instead, he brought up his personal feedback as an integrated part of a strategy talk. Specifically, he displayed a slide that listed the company’s three strategic priorities. Next to the list, he shared three personal feedback items that he had decided to work on, linking each one to a specific strategic objective. As John told me, “I wanted to make it clear to people that feedback isn’t only about you. It’s really about how we can better support our business.” As it happens, John’s point is supported by research: According to a McKinsey study, linking performance goals to business priorities helps companies achieve their strategic goals.

One thing to note: When I share this option with CEOs, they often say, “I think it would feel weird for people to hear me share my feedback.” This, in reality, is often just the CEO projecting their own hesitation onto their employees. In my own work, I’ve never seen negative reactions to CEOs when they do this. On the contrary, people tend to react very well to it — and, as other experts have noted, modeling vulnerability gives others the permission to do the same.

Still, the open approach can feel somewhat risky, especially if the company’s culture has traditionally been more on the old-school, buttoned-up side. The good news is that the CEO can start small. For example, if sharing feedback with the entire team feels too dicey, the CEO could instead just share it with two or three select people and see how that works.

How to Take It Even Further

The advice I’ve given here can significantly increase the value of the CEO feedback process to CEOs and the companies they lead. But there is an opportunity to go even further. The CEO of one global professional services firm who has been going through just such a feedback process during the past year has found it transformational — so much so that she has decided to cascade the approach and apply it to her management committee members. The board of directors is highly supportive of this decision because the initiative aligns with the company’s ongoing succession-planning efforts. So while this approach is tailored for CEOs, it can be scaled for other senior leaders.

Compared with the usual feedback approach, it does require a bit more effort, as well as the involvement of experienced internal or external leadership advisers to facilitate the process. But then again, we pay extra attention to CEOs and other senior leaders because we recognize that their impact outstrips that of any other individual. It’s only sensible that their feedback process, too, should get a little extra attention.

Topics

Reprint #:

65320

More Like This

Add a comment

You must to post a comment.

First time here? Sign up for a free account: Comment on articles and get access to many more articles.