Work Matters

Why a CEO Needs a Candid Advisor from OUTSIDE the Organization

Written by

supermoxie

in

I was reading through notes I took about six months ago during a talk given by a CEO of a large company, who was fired by his board because his firm had serious performance problems — and was taking great risks — that he never learned about until it was too late, and the firm was in deep trouble.  I can't identify him, but as I have warned here, at HBR,and in Good Boss, Bad Boss, every boss risks living in a fool's paradise — and the more power the boss wields over others, the greater the risk.

Here is his comment:

"You desperately need a candid adviser.  When you become CEO, you get a lot of bullshit.  You don't information so much as you get sales pitches.  You're alone in the ring."

This guy learned the hard way; I offer it so others can avoid the pain and obvious embarrassment he felt.  He looked like wounded animal during this talk, but I had to give him credit for being honest. 

P.S. If you read Andrew Sorkin's well-crafted Too Big To Fail, you can see how out of touch the leaders of big financial services firms were in the run-up to the meltdown.

Comments

64 responses to “Why a CEO Needs a Candid Advisor from OUTSIDE the Organization”

  1. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  2. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  3. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  4. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  5. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  6. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  7. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  8. William Cunningham Avatar
    William Cunningham

    It sounds like he may have (involuntarily?) surrounded himself with yes-men, who only worked to appeal to him in a classic attempt at cohesiveness. Nobody wants to be the bringer of bad news as there’s a tendency to shoot the messenger, so of course employees will only talk about good things in order to win favor if the conditions are conducive to rewarding positive news and punishing negative news. He should have been a little suspicious when he was getting nothing but good news. This is where management fails, missing any sort of checks for group behaviors and intentional masking of company problems in order to maintain an attractive outward exterior. As far as he knew, the outside looked great, but the company was rotting from the inside without proper managerial support.

    Reply
  9. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  10. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  11. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  12. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  13. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  14. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  15. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  16. Derak Berreyesa Avatar
    Derak Berreyesa

    Just as all managers and employees should be looking to their network of peers for support so should CEOs. If a CEO has too much hubris, I can see them getting into situations that they can’t handle on their own.

    Reply
  17. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  18. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  19. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  20. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  21. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  22. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  23. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  24. Michael Dearing Avatar
    Michael Dearing

    I think this is right on. I also think that for very early stage ventures, the CEO needs to have an outside advisor who is also *not* an investor. At least one.

    Reply
  25. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  26. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  27. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  28. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  29. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  30. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  31. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  32. davidburkus Avatar
    davidburkus

    I really like that quote “You don’t get information so much as sales pitches.” It’s kind of what the MUM Effect processes reports into: sales pitches.

    Reply
  33. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  34. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  35. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  36. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  37. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  38. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  39. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  40. Fernando J. Grijalva Avatar
    Fernando J. Grijalva

    In this regards, Dr W. Edwards Deming stated that, “As a good rule, profound knowledge comes from the outside, and by invitation.  A system can not understand itself.”

    Reply
  41. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  42. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  43. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  44. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  45. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  46. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  47. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  48. mark allen roberts Avatar
    mark allen roberts

    What you need to seek out as the new CEO is a “Heretic” as I share in my blog http://nosmokeandmirrors.wordpress.com/2009/04/10/want-to-add-value-to-your-bottom-line-quicklyhire-a-heretic/
    I am often brought in to play this role as nothing will improve overall results faster than the Heretic focused on serving the market and challenging “how we do things around here”
    Mark Allen Roberts

    Reply
  49. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  50. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  51. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  52. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  53. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  54. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  55. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  56. Bob Sutton Avatar
    Bob Sutton

    I accidentally published the above post twice. I deleted the repeat but wanted to preserve this comment from Christian Fey:
    It is intriguing how people can be so blind to the idea that you may not be right. This is generally caused by two different factors: interest in gaining favor, or being pushed out by the asshole for being dissenting. The latter is clearly a leader enabled fault, but additionally, the former is as well. By not encouraging challenges to your views, you end up telling your subordinates that the way to gain your favor is to agree with what you say. This can be good when you know you’re right, but obviously, you won’t know when you’re wrong until the s*** hits the fan and you ask, “Why did no one tell me this was a stupid idea?!”
    Thanks Christian and sorry to delete your comment!

    Reply
  57. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  58. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  59. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  60. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  61. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  62. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  63. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply
  64. Joe Marchese Avatar
    Joe Marchese

    Spot on, Bob. Let me add my thoughts from a recebt blog:
    http://mckeeverandsullivan.wordpress.com/2009/12/11/xenophilia/

    Reply

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