Management Thoughts - Tenure of a CEO

Should there not be a fixed tenure for CEOs????

This may sound very controversial but in my view it deserves a serious consideration. We are familiar with the Peter Principle which says that one rises to his level of incompetence in the organization. With some alteration in letters, keeping the spirit intact, we can perhaps say:

“Every  CEO moves towards ‘staledom’ in his approach leading the organization to doom; the speed at which he becomes stale depends on his individual personality”

Let me explain what I mean by “Staledom”. When a CEO is new, he is fresh with ideas, bubbling with enthusiasm, has a dream of steering the organization in certain direction to take it to certain level and evolves strategies to achieve his dreams. In the initial phases, he does taste success. Firstly because he would have analyzed the shortcomings of the predecessor and developed plans to overcome them. He gets advantage of starting from a clean state so that he has no hesitation to introduce “course corrections” and he does not have to explain the “U Turn” that he might have taken. Thirdly he would have also come with certain reputation and people might like to cooperate and give him a chance especially if they were fed up with his predecessor. Being new he is also more observant, more open to receive feedbacks and is positive about constructive criticisms. He becomes an enthusiastic learner to prove himself. This urge is very strong in him at the initial phase.

Slowly as he tastes success, he becomes more and more confident about taking decisions independently. If the success continues he starts entertaining an impression that he can do no wrong and a sense of invincibility sets in his psyche. Slowly he becomes autocratic, becomes intolerant to dissenting voices and then on begins his downward journey. Why does this Happen? With time situations change, outlook changes, tastes change, alternative options appear before the people. What works in one era need not work in another era. Therefore the CEOs have to be very sensitive to changing situations – firstly they should sense that situations are changing and then adopt themselves to the new situation. It is human to resist change and difficult to accept change. The past success adds to the problem as successful people get blinded by the successes achieved initially.

May be this is the reason that in US a person cannot stand for election for the third term. His maximum tenure is 8 years. Fresh ideas, new thoughts come up every 8 years if not after 4 years.

This is also perhaps the reason as to why dynasties also do not last for a long period of time. A King either gets thrown out if he loses a war or gets replaced by his son if he dies. In the latter case there is not much change in the way the Kingdom is administered. Of course some bright princes after ascending the throne do bring revolutionary changes but they are exceptions.

We can see many corporate houses where a long tenure has coincided with drop in performance. It also does not mean that by changing the CEOs frequently will keep the organization healthy. When to step down, when to change is difficult to judge but perhaps that is why “the Wise people” are put in the Board to take the “right” decisions.

Pychology of revenge - a viewpoint

Is revenge a natural instinct?

We have been told and advised many a time that anger does no good to the body. To be successful in life, we should control anger and our urge to take revenge. However one will never be able to find a person who has total control over this human emotion. Even though we realize that 'anger' is bad for our health and to take revenge as a corollary of this anger is even worse, we get trapped by these negative emotions. An uncontrolled anger and spirit of revenge could result in increase in our stress level leading to high blood pressure and if neglected could lead to heart attacks/ strokes that  can turn out to be fatal or cripple us permanently. Inspite of being aware of the negative effects of anger, we don’t seem to have any control over it and manifests subconsciously. Some could be good at masking it and some may demonstrate it with ferocity but we have to concede that all of us are afflicted with this weakness. Even great religious leaders who are supposed to have spent their lifetime in meditation, reading and understanding scriptures are not free from this shortcoming. This made me wonder whether ‘God’ has designed our psyche in that fashion. I think got an explanation to this question from a 6 year old child.

This girl along with her mother and other close relatives had come to our house the other day. She was quite active and talkative. To engage her in a conversation, one of us in the group asked her what she wanted to do when she grew old. Pat came the reply, I will get married! It aroused an immediate curiosity in all of us. When asked further as to what will you do after getting married she said without any hesitation that she will have children. That startled us no end. Then what will you do was the next obvious question and she said that I will scold them the way my mother scolds me.

I am not sure whether she is very angry with her mother and was detesting the ‘controls’ the mother was putting on her because she was also very affectionate to her mother in other contexts. But may be because she could not ‘give back’ to her mother in the same coin when she was getting 'rebuked', she thought of having a ‘target’ in her children to satisfy this urge.

Most of our misery is due to this major weakness. We find extremely difficult to tolerate any insult to our ego – we find difficult to accept our failures and shortcomings. We do not readily give credit to the opponent. If we find the opponent too much for us, we look for a ‘soft target’ whom we can bully and in turn this soft corner will search for a still ‘softer corner’ to bully and it goes on ad infinitum.

I find this behavior strange, interesting and at the same time in a way frightening. I invite your comments on this aspect.