Enterprise leadership is both individual and collective work

Enterprise leadership is both individual and collective work

Enterprise leadership is one of those slightly nebulous ideas we talk about quite a lot with clients. It usually comes up when someone moves into a more senior role, and it becomes apparent that something needs to change. Until then, it can often get mislabelled as a vague development need in perhaps strategic thinking, collaboration or emotional intelligence.

We often unfairly expect enterprise leadership to materialise out of nowhere practically overnight the moment someone steps into a more senior position.

PART 1

The individual work

Senior leaders join executive teams having been selected and rewarded for the strength of their individual contribution and judgement. They are used to being accountable for decisions and, more often than not, expected to have the answers.

It should come as no surprise that they bring those habits with them into the executive team. And yet, within a team, these strengths can become cumbersome: expertise can turn into know-it-all-ness, ownership can turn into a need to control, and advocacy for a function can look like territoriality or an inability to concede.

These aren’t necessarily weaknesses. In many cases, they are strengths that have been ‘pushed too far’. The executive who has fought tooth and nail to protect their function through years of downsizing is not likely to be excited about supporting a decision that diverts resources away from their group. The person who has developed a reputation for executing quickly can become very impatient when the team needs to sit in ambiguity for an extended period of time.

To make matters worse, executive leadership asks people to change who they are, to a certain degree, and not just what they do. Senior leaders often believe, admittedly subconsciously, that their credibility is closely connected to things like being the expert, making things happen or having an answer when other people do not.

The individual work required for enterprise leadership often begins with noticing what happens when their area of the business is affected, their judgement is challenged or they no longer have the authority to make the decision, but will still be expected to support it.

Most senior leaders can recognise this in themselves. Knowing what we should be doing in an ExCo context does not always translate into action. Also, as we become more senior, what limits our effectiveness at an enterprise level increasingly sits below observable skills and in our assumptions and beliefs and in how we respond under pressure.

This does not mean everybody needs to embark on an odyssey of self-discovery, and in any event it’s not just about self-awareness, but it is also about insights and about understanding the patterns we fall back on, because if we don’t, then we are very likely to keep repeating them.

Mixed messages from the organisation

We tell executives to think and act with the best interests of the entire enterprise in mind. Then we often measure, reward and publicly recognise them based on how their individual areas perform.

It’s these mixed messages that often lurk unnoticed in the background until the moment comes when the executive team must make a decision that will favour one part of the business over another.

An executive may be called upon to divert already stretched resources to an enterprise-wide priority and still be held accountable for local area performance. Team members can be told to challenge each other’s ideas in a meeting, knowing that speaking plainly may carry some risk in relationships they will depend on for months, maybe years to come.

It’s perhaps simple enough to tell executives to “think like an owner”. Doing so when there are real consequences for them is much more difficult. When pressure is applied, typical reactions are to do what feels safest, such as protecting their business unit or deferring to the CEO, or agreeing to something in the meeting, then working towards a different outcome behind the scenes.

This isn’t necessarily about bad intentions or people. More likely the organisation has simply never worked out how to balance functional accountability and enterprise risk and reward.

Asking executives to think and act differently is unlikely to yield much return without changing that system around them, including how the team operates.

PART 2

The collective work

Even if an individual leader chooses to lead differently, their influence is, in practice, limited if the executive team operates as a team of experts. Just because you have brought together a group of people who could lead at enterprise level does not mean you have an enterprise team. Becoming an enterprise team starts with a seemingly simple question. What is the executive team there to do?

When asked, most teams will of course say their purpose is collective. However, they are typically built around a rotation of functional updates whereby each exec comes to provide an update on their own functional area, rather than the enterprise-wide dilemmas that the group must work through together. The meetings are busy. There are updates to hear, presentations to listen to, governance items to process and decisions to approve. Participants can leave these meetings feeling like they’ve been busy and important. How much of that actually needs the executive team?

We like to differentiate between three types of decisions.

• Some decisions are executive decisions. The individual executive has both the authority and subject matter expertise to make the call, and there isn’t much to be gained by broadening the discussion to the entire team.

• Some decisions are informed by the team, where the individual clearly retains accountability but needs to seek the insight or backing of one or more colleagues.

• Then you come to enterprise decisions. In these cases, the executive team needs to hold multiple interests simultaneously and come to a collective view that its members can own together. These are the decisions that most organisations really need their ExCo to behave as a team to make, and these form the reason for the team to be.

Of course, the objective isn’t to make everything a collective decision. That just makes your organisation slower and dilutes accountability. It’s about becoming much clearer about the small number of decisions that do require all of the relevant eyes and minds at the table. What does your organisation need from this group that it can’t get from each individual running their function excellently? What decisions need an enterprise-wide perspective? What should be brought to the executive team and what should be resolved elsewhere?

Peter Hawkins’ Five Disciplines of systemic team coaching is helpful when we work with teams on these questions. We use it as a framework to prompt discussion, not a checklist to be worked through.

Broadly speaking, the model considers what the team has been ‘commissioned’ to do; what it needs to clarify about its collective purpose; how it works together as members; how it connects with the rest of the organisation; and whether it can review how it works and adapt its behaviour.

What we like about the model is that it prevents ‘team development’ work becoming an inward-facing conversation about how individuals in the team relate to one another. Relationships are important, but they matter only in terms of the work that the team is there to do.

Teams learn how to work around difficult conversations

It’s quite common to see teams skirt around challenging conversations. It’s common, for example, for members to reluctantly agree to move forward during the meeting, then privately debrief with the people they trust outside the meeting and have the conversation they should have had during the meeting. Another way teams avoid difficult conversations is by keeping them abstract. Some teams think carefully and in depth, but at times that means discussion stays conceptual and time goes on agreeing definitions rather than on the decision in front of them. It’s crucial for the team to be confident that enough debate has happened before any decision is reached, but also to recognise when a decision is needed that everyone will commit to.

For that to happen, it needs to be possible for:

• the CEO to be questioned;

• executives to challenge one another’s reasoning;

• someone to admit that they do not know or are uncertain in their position;

• and an individual to alter their position without losing face.

Psychological safety is essential here and should be developed, but it does not alone guarantee that a team will make good decisions. It makes it more possible for people to say what needs to be said. The team still needs purpose, discipline and clarity about how decisions are made.

Case study: an executive team in financial services

We were recently engaged to help with some internal leadership team challenges. Trust had become a concern, conversations were becoming less open, and the firm worried the team wasn't functioning at its optimum.

What we uncovered during the diagnostic was slightly different: while there were some trust issues, the team was also being pulled in many directions. This was leading to a focus on short-term delivery over a long-term view, quick fixes in functions over working as a team, and individual expertise over collective problem-solving. The individuals were all very smart and defaulted to using their expertise and having the tougher conversations afterwards.

Instead of focusing only on relationships, we worked with the team on how they could challenge one another, accept feedback, and work as a team to make decisions and allow more productive dialogue.

Now there is more open and honest dialogue happening within the meeting. Conversations are less likely to be taken outside of the room, issues are dealt with head-on, and team members feel more able to put thoughts out there before they are fully formed.

PART 3

Where the individual and team converge

Individual and team development often get treated as unrelated subjects. An executive works with a coach on their leadership and a team attends an offsite to improve team dynamics. Two separate interventions commissioned by separate people and talked about at different levels of the organisation. It’s perhaps better to consider them as two parts of a whole.

An individual may know that they need to challenge their peers more directly. Whether or not they do that will depend in part on their beliefs about conflict and in part on how the team reacts when they speak up. Many executive teams struggle to have those conversations in public.

One person may recognise they have a tendency to take over a conversation, but shifting that behaviour will require them to pay attention and make an effort and for the rest of the team to notice how they might have adapted to allow this to happen.

The CEO may want the team to take more joint ownership. That depends on the executives being willing to step up. It might also require the CEO to step back from doing so much of the ‘joining up’ and tension resolving themselves.

The individual creates the team and the team also creates what is possible for the individual. One-to-one coaching can bring to light the things leaders tend to protect when faced with pressure. For example, how they employ authority or what stops them thinking beyond their own responsibilities. Team coaching provides the container to address those dynamics with the people, decisions and tensions that comprise the work of the ExCo.

The work is better if done in the regular meetings rather than offsites

The real learning happens when something important is being decided. Perhaps there is not enough budget to meet everybody’s needs, or one person questions an assumption on which the strategy depends.

Somebody may feel that an important issue isn’t being considered but may be unwilling to say so, or the team may avoid tough issues or keep them abstract. A coach can pause the conversation and help the team notice what’s happening, although ultimately the goal is to help the team do this by itself.

Ideally, more complex matters get raised in ExCo at an earlier stage. There might be more disagreement in the meeting but less resolving outside of it. Executives might find it easier to switch between thinking about their functional responsibility and what is needed for the organisation as a whole, and, crucially, to work collectively to execute decisions. Less of the CEO’s effort may be required to synthesise the team’s collective thoughts.

Enterprise leadership is a practice

What enterprise leadership looks like will evolve as the team and organisation evolve. An executive team that works effectively together in one set of circumstances (for example, stability) may need to behave completely differently when faced with growth, financial pressure, a change of ownership or a crisis.

Organisations don’t wake up one day with an enterprise leadership team. They develop one by agreeing what those people need to do together, what that requires of each of them, and how they will approach the difficult work involved.