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Why Longevity Doesn't Equate to Success as a CEO

Your experience may be a liability


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Numerous studies identify that CEOs’ ability to create value for the firm is highest in their tenure’s “middle innings.” Longevity in the corner office helps, but only to a certain extent.

There’s also evidence that the longer CEOs remain in the corner office, the more adept they become at internal relationships. However, the firm’s relationships with the outside world — where all those customers live — may suffer. I attribute this to “entrenchment.”

If your skills at developing relationships are strong (and they darn well should be if you’re a CEO!), your relationships with your team and board will strengthen over time. If you’re also lucky (yes, luck is part of it) and skilled enough to occupy the corner office during a period of good performance, you’ll naturally believe that you’re good at what you do — and you probably deserve that belief.

The performance curve, however, starts to bend at some point. Why? Correlation and causation aren’t the same thing, so it’s difficult to pin down an answer. However, as the saying goes, “What got you here won’t get you there.” Your experience, which was so valued in the middle innings, may have morphed into entrenchment.

Your board members trust you, so they don’t question your ideas much anymore. Your team members respect you (and only the ones you’re fond of stay for the long ride) and may not push or question you, and you may not push them. The “instincts” and market knowledge that have served you well for so long may no longer align with the outside world, and because you now spend more time internally than externally, you may not see it. When you do spend time with customers, they’re the currently-valued customers, not future valued customers that may value different things.

Your experience is now a liability, and you’re entrenched!

Doesn’t have to be that way. You have to stay inquisitive and be pushed. Do you have a plan for that?

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Todd Ordal

Todd Ordal is president of Applied Strategy®. Todd helps CEOs achieve better financial results, become more effective leaders and sleep easier at night. He is a former CEO and has led teams as large as 7,000. Todd is the author of Never Kick a Cow Chip On A Hot Day: Real Lessons for Real CEOs and Those Who Want To Be (Morgan James Publishing, 2016). Connect with Todd on LinkedIn, Twitter, call 303-527-0417 or email todd@toddordal.com.

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