Why do CEOs Get Rehired?

13 February 2012 Dave Brookmire

There must be a shortage of leadership skills at the top where leadership performance is essential for success. Company announcements and press releases about CEO hires continue to illustrate that re-hiring CEOs is a common Board of Director practice. In theory, the best predictor of future performance is past performance, but not always the case when you examine the CEO hiring decisions of many Boards of Directors. Apple recently hired former Dixon’s CEO John Browett to head its retail operations, and with the announcement Dixon’s share price dropped about 6%. Last fall, Hara hired former Enron Energy Services CEO Dan Leff. Yes, someone from Enron was rehired a second time since his departure from that infamous company. Only time will tell how these companies perform for their shareholders under these two new hires. My hope is both CEOs will continue their leadership skills development on the job. Great leadership qualities for CEOs are in short supply and CEO development on the job seems to be lagging. I recently published an article about this common CEO hiring practice (http://chiefexecutive.net/why-do-volatile-ceos-have-nine-lives). The stakes are very high for CEO hires on the fortunes of shareholders and Board members. That is why it is fascinating to examine these decisions and to learn from experience and best practices.

Technorati Tags: Executive Leadership, leadership shortage

Company Growth Comes from Inspiring Innovation

23 August 2010 Dave Brookmire

The Wall Street Journal ran a fascinating article today entitled “Who Has Innovative Ideas? Employees,” which stated that “Most great ideas for enhancing corporate growth and profits from the people who daily fight the company’s battles, who serve the customers, explore new markets and fend off the competition.” Namely, the employees.

According to the authors, “A lot of senior managers think the opposite: that the people around them don’t understand what’s needed or are incapable of seeing the big picture. But we say this often shows a signal lack of strategic courage and resolve. We say trust your own people.” The key to harnessing employee innovation is learning how to tap and foster it, using tools the authors refer to as “Innovation Communities.”

Innovation communities tap the potential of internal talent by bringing internal resources together to solve a problem or come up with the next big idea. They can be created at little cost and can hit the ground running as the employees are already well aware of the company’s goals, challenges and target audiences.

The authors give seven characteristics of a successful innovation community:

CREATE THE SPACE TO INNOVATE
GET A BROAD VARIETY OF VIEWPOINTS
CREATE A CONVERSATION BETWEEN SENIOR MANAGEMENT AND PARTICIPANTS
PARTICIPANTS SHOULD BE PULLED TO JOIN, NOT PUSHED
TAPPING UNUSED TALENT AND ENERGY KEEPS PRODUCT-DEVELOPMENT COSTS LOW
COLLATERAL BENEFITS CAN BE AS IMPORTANT AS THE INNOVATIONS THEMSELVES
MEASUREMENT IS KEY

In this case, as with most of the management issues we have discussed, communication and trust are key. Allow your employees to work outside of the box and develop great solutions. Keep an open line of communication and be open to new ideas. As the authors point out, “As past downturns have shown, the current economic weakness offers new opportunities for those who seize them. Companies with imagination and courage can do more than tread water amid the slump.”

Read the full article here!

Technorati Tags: business innovation, employee innovation, fostering innovation