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The Life Cycle of a CEO— Claudius A. Hildebrand & Robert J. Stark

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Introduction

In fact, Dave hadn’t been the first choice for the CEO position, or even the second or third choice. Word was five others had been offered the job before him. What’s more, a couple of years earlier he’d been unceremoniously fired from his position as divisional president at a leading competitor. No one would have suggested from his educational background, either, that he was CEO material. Not only did he not have a degree from an elite school, but it also took him six years to graduate. He hated college and he’d dropped out for a time.

As Dave’s first year in the CEO seat progressed, the sneering assessments of that Florida night prevailed on the Street; the company’s stock slid 40 percent.

Yet CEOs can't just demand that board members engage more closely with them. “You have to lead the board,” Piyush Gupta said, “and persuade them of the direction you want to take the company, but at the same time, they are the bosses. It’s not straightforward.” Further complicating the relationship is that the CEO generally does not know who on the board supported them for the job and who did not.

There are going to be surprises no matter how well you know a company. Learning about them early is challenging because employees, even at the highest levels, are reluctant to share troubling information. Learning what you need to know requires rigorous questioning while conveying in a compelling way that you absolutely want people to speak openly.

A CEO coming in from the outside needs to emphasize getting a good fix on the full range of business operations, the strengths and weaknesses of the leadership team, and the nature of the culture.

Although extremely clear and compelling communication about results is always imperative, it’s especially important as recalibration unfolds. Actual results are, of course, paramount in assessing performance. But the perception of those results and of whether the CEO and leadership team are on top of the situation is at least as important.

In the year ahead, he surveyed the broader employee base as well as customers and learned that “we didn’t have that same emotional connectivity with our guests.” Or with Hyatt colleagues out on the front lines. Hoplamazian dedicated time to meeting with many of them. Through his own and others’ probing into the colleague experience, he realized that the company evaluated employees largely based on their compliance with an elaborate set of rules and that “we tracked success in our hotels by compliance with a list of brand standards, not guest feedback.