WHY CEO PEER GROUPS WORK
Leveraging Others in a Similar Role
A key attribute attracting CEOs to peer groups is the ability to leverage expertise outside their own experience. If everyone were from the same industry, with similar education, expertise, and experience, there would be almost no added value to joining a CEO peer group. This is why our peer groups consist of members from non-compete industries or segments within an industry. Additionally, for a high trust and open environment to be created in a peer group, our CEO peer groups do not allow suppliers, competitors, or vendors to be members of the same group. For example, if a member wants to share a concern about a cashflow issue to a group containing one of his or her key customers, the member would most likely not raise the issue for obvious reasons. For this, and other reasons, we carefully screen each member to ensure that these types of issues are avoided.
The Role of a CEO is Sometimes a Lonely One
Generally, the role of a CEO is a lonely one indeed. Often CEOs have no one to turn to as a confidential sounding board. Executives, managers, and employees who are proactive in finding a team of advisors to help give them feedback, coaching, accountability, and support are the ones who will flourish in today’s challenging environment. They’ll also save their companies a lot of time and money with the synergies and efficiencies gained from this type of support system.
Why Leaning on Your Executive Team or Board of Directors is Sometimes Not the Best Option
While CEOs have executive teams and boards of directors in many cases, there is a built-in bias with these groups. Bias exists with the management or executive team because they have a vested interest in protecting their jobs, their paychecks, and their staff. Boards of directors can be biased due to investor needs, a lack of complete information, and other things that create an alignment issue with the CEO. More importantly, CEOs join peer groups because it is a place where they can hear the truth from peers with no vested interest other than helping each other succeed.
Confidentiality Within Peer Groups Is Paramount
Confidentiality is also crucial when assessing CEO peer groups. To get the most value from membership, the truth needs to be shared. Unless there is a formal confidentiality policy, the CEO should be wary. Without a written, signed confidentiality agreement, a high trust and open environment where the truth can be spoken and heard will not occur. A peer group focused on improving the effectiveness of members and the performance of their companies must include as a basic premise that members will hear what they need to hear, not what they want to hear. For this to happen, confidentiality is a key factor. If you are looking for a group where real business challenges and opportunities are put on the table for a deep discussion leading to quantifiable resolutions from peers just like you, then you have come to the right place.
Holding CEOs Accountable
In general, people do not continuously improve without followup. At the CEO Advisory Council, our members have one-on-one regularly scheduled coaching sessions as part of the process. During these sessions, the focus is on the CEO, and the onus is on the CEO and the coach to ensure that the one-on-one sessions are as productive as possible. Generally, the executive coach is well armed with questions regarding everything from financial performance to strategy, from projects to key decisions, etc.
Questions are asked about follow-through on prior commitments made, and the coach/facilitator looks for specific challenges and opportunities where the group will be able to add value as well. The coach is skilled at asking probing and insightful questions and diligent about gleaning good information during the one-on-one sessions.
Ultimately, significant actions will be identified and agreed to by the CEO to make progress towards highly valued goals and priorities. Our peer group facilitators, act as coach, advisor, and mentor to ensure that every member stays focused and committed to the results they desire to achieve.
It's Lonely At the Top
Some research suggests that executives feel a sense of social and relational isolation due to their prominent positions. The CEO Advisory Council CEO Peer Groups are dedicated to ensuring that every member stays focused and committed to the results they are driving toward.
As aforementioned, it’s lonely at the top, and this is particularly applicable to entrepreneurs, who often have the least resources to tap into when mulling over the key decisions of their businesses. Often, CEOs join peer groups to reduce isolation. When CEOs are considering key decisions, leveraging their own private sounding board of peers who can provide new options, experiences, and recommendations, generally lead to better decisions.
A variety of unique factors contribute to a CEO’s isolation from employees, organizations, and their own emotional needs and desires. The following are just a few of these factors:
- The nature of their responsibilities and duties can alienate CEOs from other executives and employees. CEOs are privy to highly confidential information that cannot usually be shared with former coworkers and advisors.
- CEOs hold positions of power and authority that can lead a real or perceived sense of alienation. While good news can quickly rise to the top, bad news moves at a much slower pace.
- CEOs may emotionally isolate themselves to maintain an appearance of confidence. While this tactic may sustain overall morale, CEOs then pay a great emotional and relational cost to keep up the façade.
The main benefit of the CEO Peer Group is that rather than turning to friends or family members for support, CEOs can turn to peers in businesses who can fully appreciate the situation and provide truly informed counsel leading to real results.