There have been many articles published on what a new CEO should do in the first ninety days on the job. What can I possibly add to this discussion? I have only been an ad hoc CEO at one client, but I have counseled six CEOs in this process when the board of directors brought in a new CEO from the outside. I was asked to extend the scope of my strategy work and be a coach for this process.
Why is this article important? Many observers claim the first ninety days can make or break a new CEO. And if you are not currently a CEO and do not care to be one in your career, why should this article interest you? I think it will make you a more valuable employee to help make your new CEO’s first ninety days productive and effective.
I have watched and studied the process of a new CEO coming into a firm spanning over thirty years of practice. Note these were CEOs hired from the outside and not an incumbent who came up through the ranks. Incumbents usually know very well what to do and what they can accomplish in the first thirty days in office. I will comment on what I have seen and witnessed as being effective. By the way, not all of the six assignments above were flawless. This can be a sticky process.
Prior articles and books in this area have recommended nearly everything imaginable be done in the first ninety days. Each publication focuses on a few things which, when added together form a lengthy list. “Walk around” and meet folks, have brown bag and “skip-level” lunches (meet with folks one level lower than their direct reports), begin to think about creating a vision, assess the financials, assess the current strategic plan, get to know the company attorney – well, meet a sample of key customers and ask questions as to their likes and dislikes, begin to think about creating a strong culture if one does not exist. And CEOs are counseled to watch their body language as employees and managers will be looking closely for signs of the real person. Some have observed these new CEOS are operating in a “fishbowl”. This list is the tip of the iceberg.
All of these things are or could be very important. But beyond the above pleasantries behind these actions and the concrete things they turn up, I would focus on the first thirty days, not the first ninety days, and have a singular intent. That would be to begin to form my hypotheses about my customized framework to assess cause and effect in and around the business and eschew working at the level of symptoms. I would use all of the above conversations, lunches, meetings, etc. to begin and finish by the end of the first thirty days my customized framework that would get at understanding the few key cause and effect relationships that will improve short and mid-term performance. And as we may remember from our statistics courses, causation is not the same thing as correlation. Correlation means two variables move together but we cannot say for sure what causes what. And correlation can lead to faulty mental models. For instance, statisticians have shown a correlation between the rise of the Nile River to the growth rate of sugarcane in south Louisiana. This does not make practical sense and is called “spurious” correlation. Causation is just that: if we change one variable it will cause a change in another variable, every time.
This ‘intent and focus’ of the customized framework of ’cause and effect’ produces a simple but impactful picture of the most important things causing or preventing short to mid-term results. In a previous article, I have referred to this level of generality as “simple depth”. Notice the intent and focus is not to produce something that is very complex in the first thirty days. This is true even if the business and those things surrounding the business from the outside are very complex. A simple but impactful “doodle” is what we are after. Figure 1 shows some very simple doodle examples out of thousands that could be developed. BTW I use this approach in my first five to eight days of any strategy consulting engagement where I want to get to “root causes” as quickly as possible. Figure 1 is typed. But I just draw freestyle on a simple piece of paper. And in thirty days I would go through at least twenty to thirty doodles before settling on the one or maybe two doodles that I and the organization think will have the greatest positive impact on short and mid-term performance.
Figure 1: Example Cause and Effect “Doodles”
The figure is pretty self-explanatory but the first column on the left is the most important – the Doodle Driver. This should be a statement as to the absolute root issue that is being observed. I use a portion of the classic operations tool called a Fishbone. Let’s say you hear “We cannot seem to sell as much as we used to”. Ask Why? Suppose you hypothesize from other comments “Our quality is suffering”. Ask Why again. Continue to ask Why until you cannot answer even with a hypothesis. You are probably at the root cause level. In the first example above, we hypothetically have gotten to the root cause Driver that the Supply/Demand balance in the industry is out of whack. What follows is how the Doodle would play out and so forth for the other two examples.
During the first thirty days, two to four of the doodles will start to show the most promise. Distribute these widely and ask for feedback. Edit if need be. Then settle on the one or maybe two that you think will have the greatest causation impact on improving short to mid-term performance. This simple approach and process works. I have been amazed at how often a new CEO can become overwhelmed in the first thirty to ninety days in the office. This simple approach and process can really help a new CEO hired from the outside to focus and not be overwhelmed.
This article is part of a series on what causes a firm’s value to increase.
Dr. William Bigler is the founder and CEO of Bill Bigler Associates. He is a former Associate Professor of Strategy and the former MBA Program Director at Louisiana State University at Shreveport. He was the President of the Board of the Association for Strategic Planning in 2012 and served on the Board of Advisors for Nitro Security Inc. from 2003-2005. He has worked in the strategy departments of PricewaterhouseCoopers, the Hay Group, Ernst & Young and the Thomas Group. He can be reached at bill@billbigler.com or www.billbigler.com.