Less lonely at the top

CEO coaches are in demand ...and with good reason

By Jim Masciarelli

CEOs don't have to go it alone when the demands of the job mount. A coach can help renew their energy and challenge them to be even more effective.

As the former CEO of a national professional services firm, I once faced a touchy crisis that was brewing internally. For years my firm had used a revenue-based compensation model, but I increasingly realized that we needed to change to the less-popular "contribution-to-profit" arrangement if we were to survive and achieve significant growth.

During days of tense and emotional deliberations, I maintained an upbeat, unwavering air, even though I was agonizing privately over whether this new compensation model would even work.

Other times I simply wondered whether we could keep meeting payroll in the coming months. Externally, however, I always aimed for "grace under pressure," no matter whom I was with and what was happening. I believed I had to keep up a facade.

My experience might have been different had I worked with a peer to help sort out my thinking about these problems and arrive at pragmatic solutions. But in the '70s and '80s, little coaching was available for high-level executives.

Today, the practice has gone mainstream, and executive coaches seem to have popped up everywhere. A specialty within this new expertise focuses entirely on coaching, guiding and challenging the CEO.

How can a CEO coach help? Many CEOs report dramatic increases in their ability to deal with the overwhelming demands of the job. Since CEOs typically feel knocked around a lot, coaching helps renew their energy, enthusiasm and determination. It also helps them review their options for handling difficult issues. There's usually a carryover effect to the CEO's team, helping it to work in a more effective and integrated manner.

One top manager, for example, a client that I'd call a "bulldozer-style" CEO, once perceived my suggestion about his leadership style as a breakthrough: He should shift from a push-oriented, micro-management style to an empowerment approach.

At the time, he was limited by his belief that he had to think through every problem himself and have all the answers. We worked on his ability to get employees to take more initiative in solving problems. Before long, as the CEO later confessed, far more knowledgeable solutions began to emerge than he could have imagined himself. And he was able to focus on the "macro" issues more appropriate to his leadership role.

In another case, Don Mitchell, CEO of MicroE, a control systems company in Natick , Massachusetts , found that his work with a coach for more than a year had a trickle-down effect in the company. "You don't do CEO coaching in a vacuum," he says. "My coach has improved my ability to do a number of significant things, such as hiring and running meetings. And he's also facilitated better communication among members of my team. From what I've seen, good CEO coaches don't work just with the CEO, they work with everybody."

Peer to Peer
Although CEOs have long called upon informal advisors, today's coaches typically offer a systematic process that includes organizational development know-how and teamwork and leadership-effectiveness skills. Many of today's coaches have, like me, even worked as CEOs themselves. They intimately understand the natural isolation of the job.

Cary Johnson, CEO of FirstSense, a software company in Burlington , Massachusetts , brought in a coach to help him gain fresh insights and points of view. "I was attracted to someone who'd been through this before," he says. "Because of my coach's previous top management experience, I felt secure that he could effectively help me take a whole new look at things."

The issue of security looms large in the minds of many CEOs who consider hiring a coach, however. They may fear, for example, that working with a coach will be perceived, especially by the board, as a statement of competence. Why would a CEO who's up to the job need a coach? As Johnson notes, "Fortunately, I have a lot of self-confidence. But if you don't have a lot of self-confidence, it's hard to go outside for help."

Though a lack of confidence was not an issue in his case, Johnson has seen this problem derail the coaching process for another CEO. This chief executive was forced to bring in a coach by his board. But he silently resisted the coach's suggestions for months. He paid lip service to her ideas, implementing few of them and none with any fervor. After months of predictably ineffective results, the coaching relationship was terminated.

One day, in a moment of candor, the CEO commented to his staff, "You know what really gets me upset? If we hadn't been doing all this touchy-feely stuff, imagine how much farther along we'd be." Johnson, hearing the remark, resolved to take the process seriously if he were ever in the top job and hired a coach for himself.

When coaching is welcomed, the process can generate benefits that register well beyond the CEO's office. The CEO of a leading insurance company in the Midwest , for example, reports that his work with a coach enhanced the organizational dynamics of the company.

"The effect of CEO coaching on my team has meant higher levels of self-awareness, lower levels of territorialism and an overall sense in the company of greater optimism," this chief executive observes. "Nearly everyone's now more aware of the impact of what they do on others and how we are each interdependent and responsible for what we do. Of course, there are always the 'holdouts' that resist change of any kind. But attitudes here generally are demonstrably improved."

Johnson reports the same experience. "Because of working with a coach, we've been able to 'put our bowling balls on the table,' as I like to say it, to get our issues out in front. In the past, we've had some relationships that were really broken. But now that we've spent time expressing our feelings, disagreeing, understanding each other, there's been a new burst of energy pushed into our management team, a direct result of my having been coached."

Coaching Qualities
Does a CEO coach make sense for your company? If so, how can you go about selecting a good one? Mitchell suggests doing a self-assessment to clarify "where you're strong and where you're weak," so that a coach will be able to help where you need it most.

Other CEOs say that effective coaching always combines counseling with an emphasis on leadership development and effectiveness. Good coaches form partnerships with their CEOs, offering a confidential intervention that deals with both human potential and identified business results.

So when searching for a coach, seek an individual who has the ability to patiently and persistently cajole, inspire and challenge, while also playing the role of mentor, confidante and even conscience within the context of an "unforced" relationship.

To generate new CEO and organizational behaviors, a coach also must have a talent for communicating objective, unbiased feedback that is tailored to a CEO's innate predisposition. A few examples of such predispositions include: strategic thinkers (focused on strategy, tactics and action), human capitalists (recognizing the value of human resources), change agents (intent on implementing meaningful change) and controllers (focused on financials and the bottom line). In effect, the coach must know intuitively how to "connect the dots," no matter what the personality type of the CEO.

Beyond that, a CEO coach should have the following attributes:

• Credibility... This comes from a breadth and depth of hard-won experience as a CEO, along with experience in different industries and stages of corporate development.
• Post-heroism... An effective coach is beyond the "proving" stage in his or her own career. Therefore, the coach will not be competing for the limelight and will be motivated to mentor others.
• Independence... When a coach's lifestyle isn't dependent on the assignment, he or she can offer objective feedback. This outsider's view based on insider's knowledge can prove invaluable.
• Superior personal standards... Good coaches embrace lifelong learning and invest regularly in developing their own mind, body and spirit.
• Strategic and tactical skills... A coach who can frame issues quickly and generate a lot of practical ideas will help a CEO think innovatively and lead the organization with vision.
• A resource network... A well-developed professional network is a powerful appraisal powerful asset for a coach. The network augments the coach's ability to research problems and extends his or her expertise, which can lead to opportunities for added learning and development.
• A toolkit... A good coach will have a sizable inventory of skills, such as listening, probing, constructive confrontation and group facilitation, an array of business tools, such as decision-making and planning models and executive assessment instruments.

Beneficial Bonding
A coaching engagement works best when the coach and CEO so some work up front to ensure a good fit and plan the process. It is best to start with a short-term engagement. Every solid partnership begins with a successful courtship, and this trial period will allow the coach and CEO to identify their shared belief system and reach a conceptual agreement on such pivotal matters as overall objectives and measurements.

At this point, the coach will conduct an organizational needs assessment, and the CEO will thoroughly interview the coach. If the coach appears to offer added value, and if mutual trust has been established between the two, a coaching contract can be drawn up.

The contact should establish the length of the engagement, generally of no less than six months. Other clauses will cover a commitment to absolute confidentiality (even the board may be apprised only of goals and results, no more), a process chart of tools and activities, a complete schedule of sessions and a description of how the overall coaching process will be monitored and evaluated.

Based on the knowledge gained in the initial organizational review, the coach will guide the CEO in developing a personal competency model. Formal assessment tools and interviews provide initial data points, followed by interviews with the board of directors to obtain more input. This completes a powerful appraisal process to be used in setting goals and developing specific activities for the coaching sessions.

Staying Alert
CEO coaching is not for everyone. In some cases, personal and organization insecurities can get in the way. But when it’s implemented well, coaching will stimulate smart, new ideas from the CEO about effectiveness and growth, helping to boost personal performance and revitalize the corporate culture.

"The worse thing that can happen to any company," says Johnson of FirstSense, "is when its people mentally leave it. Efficiency drops off, morale drops off and they begin communicating their unhappiness to everyone around them. After that, it all starts a snowball rolling down the hill."

A CEO coach can help prevent this decline by drawing out key issues for the top executive and his or her team. As Johnson says, "Often, just being aware of such issues means you can fix them."

When to Hire a CEO Coach Here are five scenarios in which a CEO coach can prove most useful:

• The company is growing rapidly... When a leader wants to take the company to the next level, a coach can help him or her develop new skills, upgrade the top team, set new business goals, establish performance management structures and implement process improvements.
• An entrepreneurial company has a first-time CEO... Depending upon the limitations of the CEO's previous role (in sales, finance or operations, for example), he or she probably needs wide-ranging coaching to learn how to manage a board of directors, plan strategic alliances, raise capital and/or understand corporate functions in general.
• A "successor CEO" is promoted from within... A coach can help keep a succession plan on track by assisting the new CEO in taking on the unfamiliar role and handling any natural ambivalence on the part of the retiring chief executive. If the coaching relationship continues through the transition, the new CEO will better deal with adjustment issues and shorten the ramp time needed to drive the business profitably.
• The CEO must serve as a change agent... In this case, the coach becomes a key advisor in shaping the business strategy, organizational design and dynamics, and the CEO's approach to change and conflict management. The coach's input can help the CEO with some tough decisions as he or she contemplates major organizational and strategic shifts and puts several plans under the microscope.
• The CEO is seeking professional development... A CEO and coach can work together to identify a number of specific performance goals. The coach may bring in specialists to address some of these issues, such as presentation or media skills, as part of an overall development program. Meanwhile, the coach may focus on broader topics, such as running more effective staff and planning sessions, improving company-wide accountability, becoming more organized, balancing priorities and enhancing communication and problem-solving skills.

About the Author

Jim Masciarelli is an entrepreneur, investor, public speaker and corporate coach with first hand experience in founding and growing three companies as President. He currently divides his time between investing and advising high-technology companies as a Principal of Walnut Venture Associates and conducting breakthrough executive retreats as Chairman of Archer Development. He is author of “PowerSkills: Building Top-Level Relationships for Bottom-Line Results.”

Jim can be reached at: jimm@archerdevelopment.com.