LASA 2014 Measuring CEO Performance. LASA 2014 “A better world through exceptional leadership.”

LASA 2014

Measuring CEO Performance

LASA 2014

“A better world through exceptional leadership.”

LASA 2014

“Mobilising people to achieve important outcomes … in order to thrive.”

LASA 2014

Key roles of Boards 1. Set Vision through to Strategy

2. Recruit and monitor CEO3. Manage compliance and risk

LASA 2014

Why measure CEO performance?

LASA 2014

Why measure CEO performance?

“The most common form of foolishness is forgetting what we set

out to accomplish”. Nietschze

LASA 2014

“Adequate strategy with great execution is much better than great strategy with poor execution.”

Why measure CEO performance?

LASA 2014

Why measure CEO performance?

1. CEO is responsible for strategy AND for compliance AND risk

2. i.e. Your organisation’s entire future … and maybe your reputation and house … depends on the CEO.

3. Hawthorne Effect: measurement means improvement

LASA 2014

Measure CEO performance in two key domains

• Technical Leadership • Adaptive Leadership

LASA 2014

Type of Challenge

Problem Definition

Solution Locus of Work

Technical Clear Clear Authority

Technical & Adaptive

Clear Requires Learning

Authority & Stakeholders

Adaptive Requires Learning

Requires Learning

Stakeholders

TechnicalAdaptive

LASA 2014

Technical Outcomes• Vision• Mission• Strategy – The CEO’s Workplan• Business Plans (finance, HR, etc.)

LASA 2014

Adaptive Outcomes• Culture• Change• Behaviour• Organisation Development

LASA 2014

Common Tools• Chair - CEO professional supervision• Evaluation against strategic plan• KPIs • 360 degree feedback• Culture surveys• Board “presence”

LASA 2014

$ Performance Incentives• Often controversial• Often (at least partly) subjective• MacGregor Theory X-Y, Herzberg Hygiene

- Motivator, and more

LASA 2014

Role of the Board• Every CEO evaluation is also the Board

looking in the mirror.• Ends and means policies in place?• Systems aligning to vision?

LASA 2014

Tips & Tricks1. Plan process well ahead2. The strategic plan is the CEO’s

workplan3. Align reports to strategic outcomes.4. Regular out-of-meeting communication5. No surprises!

LASA 2014

Traps1. The CEO - Board psychodynamic system2. Involvement: CEO - Board Goldilocks involvement3. If KPI’s: align with strategic plan4. If incentives: great care

LASA 2014

Questions

?

LASA 2014

Measuring CEO Performance