According to McKinsey, the best CEOs use the first six to 12 months of their tenure as a moment of great personal transition and institutional renewal. There are four keys to success.

The best CEOs don’t miss the opportunity to make their first six to 12 months (not just the vaunted 100 days) both a personal transition of great import and a profound moment of institutional renewal. While each leader will act in ways befitting their unique situation, there are at least four common ingredients for success:

• not making it about you
• listening, then acting
• nailing your firsts
• playing “big ball”

Now, we review each in summary

1- Not making it about you:

In his 1979 book Transitions: Making Sense of Life’s Changes, the late author and consultant William Bridges wrote about the difference between transition and change. According to Bridges, change is something that happens to people. Transition, on the other hand, is internal: it’s what happens in people’s minds as they go through change. Change can happen very quickly, while transition usually occurs more slowly. The distinction is subtle but vital to understand for a new CEO who is pursuing both personal and institutional renewal.

The day you become CEO, you undergo an enormous amount of change. For one, all the attention becomes laser-focused on you, often in ways that distort reality. Says Brad Smith, former CEO of the accounting software giant Intuit, “It’s no secret that we all get ten inches taller and our jokes get funnier the day we assume the role.” At the same time, your power gets magnified. “Every time you say or do something,” says DBS Bank CEO Piyush Gupta, “it’s got a massive consequential effect. The whole company pivots.”

All this attention and power can quickly create a celebrity CEO phenomenon where the transition becomes all about you. Successful CEOs don’t let this happen—they keep their minds focused on the institution. As former Itaú Unibanco CEO Roberto Setúbal explains: “All CEOs need to ask themselves, ‘What do you want to be remembered for—as a great person or a person who made the company great?’ If you want to make the company great, then you must think about the company first, yourself second. It’s human nature to want to be recognized, so it’s not easy to put the institution ahead of yourself.”

Former Mastercard CEO Ajay Banga reinforces the point with a memorable analogy: “You want them to not remember you. You want the company to be successful where it’s headed. You do not own the business unless you created the company and were Steve Jobs or Bill Gates, and then they should remember you. Guys like us, we’re just stewards of the system in a ship sailing through the sea. You have to make sure that the boat doesn’t sink while you’re there and that during the voyage it picks up a couple of extra sails and some new engine technology. You make the boat work better. But you don’t brand the boat with your name and call it the Ajay Banga boat.”

Such advice sounds laudable in theory, but what does it mean in practice? Taking this approach starts with asking different questions, which then lead to different answers. For example, Microsoft’s Nadella and Discount Bank’s former CEO have their word on this and the last one used a daily ritual to remind herself that the job was not all about her: “Every morning, when I went to my office, I entered the room, looked at my chair, and reminded myself that people were going to walk in and talk to the chair. I sit in this chair now, but I have to remember that I have to be humble. I have to remember that everyone is the same. I sit in this chair, and it makes me powerful, but tomorrow I’m not going to be in this chair.”

2- Listening, then acting

When a new CEO takes over, anxiety levels can run high within the organization. Everyone wants to hear what the new person thinks, what will change, and what the change will mean for them. With people overanalyzing every word and move the new CEO says and makes, the urge to decide, declare, promise, and explain is strong. The best leaders in transition know that it is better to listen and find out what is really going on before making broad declarations or premature moves. Of course, context matters—in a turnaround situation, there will be a premium on action—but in most contexts successful leaders subscribe to Albert Einstein’s edict of, “If I had an hour to solve a problem and my life depended on the solution, I would spend the first 55 minutes understanding the problem.” Practically speaking, this ethos translates to the following practices:

- Start with a broad-based listening tour.

- Create a fact-based “one version of the truth.” 

- Lock in a short list of bold moves.

- Communicate those moves in an elegantly simple, engaging manner.

On his listening tour after being announced as the next CEO, Intuit’s Smith asked the same three questions of board members, investors, fellow CEOs, and employees: “What are the greatest opportunities we haven’t yet capitalized on? What are the greatest threats that could end this storied franchise if not addressed? What is the one thing I could do to screw it up?” Examples of other powerful questions you might consider asking are: What do you hope will change? What should not change? What aren’t people telling me that I need to know? What am I not hearing that I should be hearing? Lockheed Martin’s former CEO Marillyn Hewson explains why such questions are uniquely powerful during the transition period: “People tell you things because you’re the newbie that they’re not going to tell you two or three years from now.”

The perceptions you pick up during your listening tour should be validated with facts where possible and augmented by analytics that can help answer tough questions about the state of the business. The goal is to create one version of the truth that you can use as a baseline for the organization’s aspirations and against which to judge its future performance.

3- Nailing your firsts

Once you have a strong, fact-based understanding about what is needed to propel the business forward, it’s time to identify the biggest needle-moving actions that you will lead. What will you buy and sell? Where will you invest differentially? How will you improve productivity? Where will you create more differentiation? How will you reallocate capital? McKinsey research shows that making even two big moves across these arenas more than doubles the likelihood of rising from mid- to top-tier performance, while executing three or more makes such a rise six times more likely. Furthermore, CEOs who make these moves earlier in their tenure outperform those who move later, so there is a premium on mobilizing the organization quickly.

You may be wondering, “If moving fast is important, why do great CEOs invest so much time in listening first?” Alain Bejjani, the CEO of Dubai-based conglomerate Majid Al Futtaim, explains this paradox of going slow to go fast: “We aimed to have the most inclusive process possible. Doing so built a broad sense of ownership, and we also found that some of the most insightful answers came from people we wouldn’t normally have approached for input, which in hindsight would have been a significant loss.” Best Buy’s former CEO Hubert Joly reinforces the point: “Of course you have to create a plan, but you have to cocreate it. It doesn’t need to be perfect—the key is to create energy and manage energy.” Bejjani’s and Joly’s experiences are supported by social science that suggests that people are up to five times more motivated to execute initiatives that they have had a hand in creating versus ones that have been handed down from on high.

A powerful tool to mobilize the organization in the desired direction is to distill the company’s transformational vision and strategy down to an elegantly simple “one-pager.” Says DBS’s Gupta, “We put together a one-page visual we call the DBS House. On it is everything: our vision, strategy, values, targets, etcetera. It allows us to all talk the same language about what we want to do and, more importantly, what we do not want to do.” Similarly, Ivan Menezes, the CEO of beverage maker Diageo, carries around a one-pager called the “Diageo Performance Ambition” that has the company’s purpose and vision at the top and then lays out the company’s six strategic pillars—written in simple English with no jargon. Menezes describes why it’s so useful: “Whether you’re on a bottling line in Kenya or doing sales in Vietnam, you can find yourself on the page and know where you could make a difference. It’s very helpful in depicting the clarity of the strategy and the change that is needed.”

Applying the following four principles will go a long way to ensuring that your first impressions are positive:

• Understand people’s “why?” 
• Keep to a single narrative.
• Err toward complete candor.
• Prepare intensely for moments of truth.

4-“Play big ball, not small ball,” advises Sandy Cutler, the former CEO of the power management company Eaton. “By that I mean spending time on things that no one else can in ways that magnify your effectiveness without getting mired in things that don’t make a difference.”

To play big ball throughout their tenure, new CEOs can put three foundational elements in place early:

• Time management: Set clear boundaries and stay extremely disciplined.
• Talent: Put “A” players in critical roles, move on C” players, and help “B” players succeed.
• Operating rhythm: Combine accountability with urgency and targeted coaching.

At Mastercard, Banga learned to become extremely careful about how he used his time: “If you, as CEO, can’t figure out what matters to you, and if you are not willing to make the time for it, then it’s your problem. No one can help you.” He set boundaries and adopted a color-coding system in his calendar. The time he spent for travel, with clients, regulators, in internal meetings, and so on were each assigned a different target time allocation and color. “If I wasn’t spending time in the right places in any of these areas, a quick look at the calendar would make that abundantly clear,” he shares. “One of my chief of staff’s primary jobs was to make sure that the balance of meetings was correct.”

The second area to get right early is talent management. GE CEO H. Lawrence Culp shares why: “Your people decisions are really where all your leverage is. As a CEO, you absolutely have to get those right.” The best CEOs create a short list of roles (30 to 50) that will have the most impact on driving their company’s strategy. Then they make sure those roles are filled with A players. They also make tough calls on C players, even those who have been loyal to the organization for decades. JPMorgan Chase CEO Jamie Dimon clarifies the rationale for this: “If we were ‘loyal’ to them by leaving them in the job, we’d be hugely disloyal to everyone else and to the company’s clients.”

The third foundational element that will enable you as CEO to play big ball is establishing a robust operating rhythm for the company. This is harder than it may seem because it also involves deciding the altitude at which you will fly. As the corporate CEO, you have business unit CEOs reporting to you who have the operating responsibility you no longer have. Although you will need to empower those people, there is a trap to avoid, as GE’s Culp explains: “I’ve seen a lot of my peers giving their business unit CEOs a lot of room because that’s what they always wanted when they were in the role. Then someone surprises them in not a good way, and they start to think differently.”

GE’s Culp describes how it feels when it all comes together: “I liken it to the flow I remember when I was on my high-school basketball team. We ran fast, took care of each other, and we were successful. Running fast with incredible people working at this level—I just find it to be great fun and rewarding in a whole host of ways.”

By not making it about you, listening then acting, nailing your firsts, and playing big ball, you’ll soon hit your stride.

By McKinsey, access date: 20.Nov.2022

In case you are interested in reading the full text, please see this link.

Acknowledgement: We have replaced the old article with this new one that found more useful. So, the access and posting dates do not match.

Thanks for your attention and comments, in advance.