The Insulated Leader

Do CEOs know less than their employees about what’s really going on in the business? That’s one of the provocative questions raised this month by Hal Gregersen, executive director of the MIT Leadership Center, in “Bursting the CEO Bubble.” Gregersen, whose article is based on interviews with more than 200 senior executives, says that status and authority often insulate CEOs from critical information that might challenge their assumptions and strategies. No one wants to tell the boss bad news, so the CEO may be the last to hear it. It’s a common problem. But it’s not insurmountable. Some of the world’s most innovative leaders have found ways to avoid this trap—but those tactics require executives to break out of their routine. One technique is simply to be quieter. Instead of going into broadcast mode, executives should relentlessly ask questions of their colleagues, and they should carve out space to reflect deeply on the challenges they face. Above all, they should go on “listening tours” to identify weak signals that might be early indicators of looming threats and opportunities. How can you foster a culture in which employees feel free to speak openly? Walt Bettinger, the CEO of Schwab, requires his managers to write “brutally honest reports” that candidly address, among other things, what’s “broken” in the company. He even invites employees who raise consequential issues to visit headquarters. Yes, it’s comfortable in the bubble. But comfort can be your worst enemy.

The Insulated Leader

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