There is a significant, persistent problem within the organization’s leadership ranks.
Ditch is caused by one or more of the following 6 conditions:
One: Weak, Uninspiring Leadership
The CEO does not have the necessary vision, leadership or management skills to direct the company.
Two: No Respect
The CEO does not command the respect of the organization.
Three: CEO’s Leadership Style = Strange Behavior
The CEO’s (or could be the dominant, controlling shareholder) behavior causes constant anxiety throughout the organization. The CEO could be:
- someone with a huge ego (“I know what’s best”)
- totally bored, tired or checked out (sick of the business)
- stubborn (does not listen to anyone else)
- irrational (constantly changes direction)
- too nice (will not hold anyone accountable)
- blaming others (“…if I only had good people working for me…”)
- out of reality (living in la-la land)
- a combination platter of ANY of the above
Four: Corporate Governance is Broken
There is continuous tension about the ‘lack of alignment’ and ‘who we are’. Members of the Board of Directors don’t agree with each other, and/or the Board and management do not see eye-to-eye on:
- ‘small’ stuff like strategy and direction
- the key issues confronting the company
- how well the management team is executing
Maybe they just don’t want to be in the same room with each other anymore.
The constant, meddling actions of the controlling, outside investors in the day-to-day affairs of the organization have a direct, negative impact on the organization’s performance. Intrusive behaviors typically mean the investors don’t trust management to do the right things. In one venture-backed technology company I was involved with, a significant investor/board member called the CEO or the CFO every day at 4:45 for an update.
“Just checkin’ in…”
Six: No Hands on the Wheel
A good governance framework does not exist. There is no active Board of Directors or Board of Advisors; if one does exist, and it is only ceremonial in nature, that is almost the same (or worse) than not having one at all.