Henry Ford ruled his innovative assembly line company like a dictator, he had a hand in most every decision, and when backers didn’t agree with him, he simply bought them out. Later, a CEO would simply hire a COO to help run the organization. To paraphrase an old saying, organizations and their top management teams (TMT) have come a long way baby.
Business environments, CEOs, and their TMTs face an abundance of challenges that Henry Ford would probably only dream of in his worst business scenario nightmare.
- Global competitions
- Changing technology
- Organizational complexity
- Diverse yet interdependent business units
- Mobile staff in widespread locations
Of course, there are the internal stresses, disrupters, and explosive elements that can cause a TMT, or any team for that matter, to become dysfunctional. Internal elements consist of
- Lack of trust
- Lack of commitment
- Lack of accountability
- Inattention to results
You will no doubt recognize these five elements from Lencioni’s Five Team Dysfunction Model. There are several models such as this one that are supposed to help guide teams and CEOs through the mire that is often business. However, a recent study examining five such models illustrates that each of these models has its good and not so good points. The authors of the study suggest that models can be a good tool and when applying them, there should always be a heavy dose of common sense. If you do use a model, ensure that it matches with the personalities of your TMT, aligns and works with your strategies, and suits your industry.
Having said all this, it still stands that, “…it is the CEO’s leadership, in the end, that spells the difference between a high-performance executive team and [a] colossal waste of executive time and energy.” (Nadler). Here are some other ideas that CEOs can implement to help in better managing their TMTs, creating high performing teams, and avoiding the TNT scenario.
Size Matters: According to one source, the ideal size of a TMT is between six and 10 members. The reasoning is that anything below six members can result in poor decision making due to a lack of diversity; and if you have more than a 10-member team, effectiveness begins to suffer. One of the organizations I work with has about 175 employees and has a 10-member executive team. Another organization has 350 to 400 employees and has only a six-member executive team.
One large organization had 18 members on the executive team. The CEO divided them into three top teams. One team took on strategy and long-term issues, another took on operational and short-term issues, and the third took on concerns regarding governance, policy, and people. The CEO sits on all three teams and other members sit on one or two of the teams. This has the potential for items falling through the cracks as the left hand would not know what the right hand is doing without strong communication and serious regard for other areas. Being strategic will help you decide how many team members you require.
Team Composition: TMTs must have members who can respect the ideas and opinions of others. Team members who welcome healthy debate without carrying a chip on their shoulder. You cannot allow back stabbers and gossipers to be on your executive team. These types of negative behavior will be the cause of massive failure.
Make your team member selections carefully and help everyone to understand one another. Accomplishing this can be achieved through using assessments, coaching, and other tools. Further, every executive team member could be the next CEO, so choose executive team members wisely with an eye on the future.
Building the Team: Potential members of your executive team begins at hire. When it comes time to create the team, it is smart to be sure that you have the right mix of skills, attributes, and talent needed on the team to reach goals. One source even suggests having members rotate on and off the team for different projects. However, this idea is more in alignment with special project committees and a lack of consistency and flow would be a concern with this idea for a TMT.
Follow Through: One of the important requirements for a high-performance team is ensuring that TMTs complete their work. Project management is an essential tool to ensure follow-up, completion, and that your strategic plan stays on track.
CEO Role: CEOs are still essential to the success of their TMTs and the organization. However, one study posits that CEOs will tell you they spend their time doing one thing, but the study reveals they do quite another. Regardless of the need for the guidance of a CEO or the tasks they perform, studies are still being written, and the economy is still suffering, from sins of past CEOs. Ethical behavior is always in demand. In addition, one source suggests that a CEO should be humble. The reason is that humbleness in a person suggests they are more likely to have the interests of the entire organization in mind rather than possessing an egotistical and selfish perspective.
Certainly, most CEOs and their teams understand the importance of building strong teams. Ideas that can help build stronger teams are team building activities, personal development seminars, and corporate events. These activities are essential. However, teambuilding must be an everyday occurrence and built into the culture. This is what drives strong TMTs and prevents your team from being TNTs.
Graphic Credit: BigStock.com Copyright: prometeus
Caldert, A., Carrera, A., Cornejo, M. (2017). The Keys to Being an Effective Executive. IESE Insight. 2017 1st Quarter, Issue 32, p44-51. 8p. 10.15581/002.ART-2983
Gunderson, A. (November 2009) The Great Leaders Series: Henry Ford, Founder of Ford Motor Company. Inc.com https://www.inc.com/30years/articles/henry-ford.html
Nadler Advisory Services. (n.d.). Teamwork t the Top. http://nadler-leadership-advisory.com/NAS-White-Papers/3_Teamwork-at-the-Top.pdf
Neatby, J., Aube, C., & Rious, P. (2013, Fall). Executive Teams: An Analysis of Popular Models with a Perspective from the Field. Organization Development Journal. Fall 2013, Vol. 31 Issue 3, p73-89. Retrieved from DeKalb County GA Public Library on-line
Ou, A.Y., Tsui, A.S., Kinicki, A.J., Waldman, D.A., Xiao, Z., Song, L.J. (2014). Humble Chief Executive Officers’ Connections to Top Management Team Integration and Middle Managers’ Responses. Administrative Science Quarterly. Mar2014, Vol. 59 Issue 1, p34-72. 39p. Retrieved from DeKalb County GA Public Library on-line