The seven surprises that await a new CEO

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Newly appointed CEOs invariably look super-confident. They have adroitly moved up the ranks – if not in the organization they lead, an equivalent training ground – and have been chosen because they understand and are prepared for the challenges of the top job.

Except often that’s not true.

“Stepping into the role of chief executive can create a profound discontinuity. Leaders often discover that everything they mastered in prior roles is necessary but no longer sufficient – not simply owing to the scale or the visibility of the job, but because of the dualities that define its daily reality,” Nitin Nohria, former dean of the Harvard Business School, writes in The CEO.

He has run an exclusive boot camp for incoming CEOs at the business school for several decades and found that while CEOs hold immense direct power and can make almost any decision they wish, they find on entering the corner office that real influence can often only be exerted indirectly. They operate within real constraints, needing buy-in from their teams and boards to move the organization forward. They hold great formal authority but their most enduring impact comes from legitimacy – the trust they earn through fairness, character and consistency.

Within the first few days of his workshop, he says the CEOs begin to describe – sometimes with curiosity, sometimes with humility, sometimes with frustration – just how different the role is from anything before. One participant called it “the steepest learning curve of my life.”

It’s summed up by seven surprises that greet them in their new role:

• You are always in the spotlight: In every situation their words, actions, tone and body language are studied and interpreted. They are never off the record. They are always sending a message, intended or not. Every decision – even a travel plan or seating arrangement at a meeting – is analyzed. “They can unwittingly spark a new initiative with a stray comment,” he writes.
• You can’t run the whole company: In the past, their success came from leading a major element of the business, where they were close to the action, responsible for making decisions and accountable for results. Now they must switch from direct leadership to more indirect activities such as strategy, structure, culture and systems. They must set direction, establish clarity and build alignment. “They must shape the context that enables others to make good decisions, rather than making most of the decisions themselves,” he says, adding that this change can lead to a deep sense of loss and grief.
• Giving orders is costly: They now have seemingly total power. They can overrule decisions, reassign resources and reshape teams. But he observes they also learn, often through trial and error, that there is a price to pay for exercising that authority too frequently or too forcefully. An intervention can create problems downstream in the organization’s activities they can’t anticipate from the top. If the CEO exercises too much control or exerts authority too often, others may stop taking ownership and come to the boss for every decision.
• It’s hard to know what is going on: Many new CEOs expect that the top job comes with the clearest view, because the entire organization now reports to them and they can ask anyone for a briefing. But those briefings are often suspect – or should be because they are carefully filtered, often, ironically, to please the boss. To be informed, they become like spies, dropping in unexpectedly on meetings and walking the halls, chatting, trying to pick up clues to the truth. 
• Pleasing shareholders is not the goal: At first, they are keen to please shareholders – that seems a chief aspect of the job. It’s also easy to equate the market’s approval with their own success. But they learn that shareholders’ wishes are not always right, such as the CEO who too quickly divested a low-margin unit under pressure and later found, as did stock analysts who had been pressuring him, it was more vital than realized. There are also many shareholders, not always in accord. Who takes precedence?
• You are not the boss; the board is: Being at the top of the organizational chart does not make you the ultimate boss. The board that hired the CEO is now evaluating them, deciding compensation and, if necessary, prepared to guillotine them. Initially, their relationship with those directors is amiable but distant. “CEOs learn that managing a board is more complicated than their prior experience of managing a boss. They now report not to one person but to a collection of individuals, each with a different perspective, personality and level of engagement,” he says.
• You are only human: The most personal surprise for new CEOs is how deeply the role touches their emotions. “Though people constantly surround them, CEOs often feel profoundly alone. They carry burdens they can’t easily share. They must project calm even when they are uncertain and optimism even when the future is unclear. One CEO in our workshop observed, ‘You have to always look like you know where you’re going – even when you’re not sure.’” Mr. Nohria writes.

Leaders arrive at the top believing they know what the job entails. But each surprise, he concludes, strips away old habits and demands a different way of leading.

Cannonballs

• Career coach Jenny Wood argues in her newsletter the distress over wasteful meetings has led us to over-correct, relying too much on emails and other asynchronous communications. Yes, there are meetings that waste time, such as status updates and meetings about scheduling more meetings, but there are also “visibility” meetings where you talk to someone, understand what they’re working on and share what’s on your mind. Those meetings deepen relationships more than email ever will and must not be jettisoned.
• Marketing consultant Mark Schaefer says marketers need to be alert to two systems that will determine future customer choice. Humans reward reputation, experience, emotion, relationships and belonging. The AI system, through which customers increasingly search for purchases, rewards clarity, structure, evidence, relevance and explainability.
• Leadership consultant Mark Yeoell observes that organizational culture is shaped more by the worst behaviour leadership tolerates than by the best behaviour it hopes for.