In 2007, forty CEOs of the top two hundred companies on Fortune's 500 list were removed- not retired but fired or made to resign. They were all highly regarded when they were appointed- they seemed to have all the right qualifications. But the reason they lost their jobs was because they couldn't or didn't deliver what they said they would. When 20 percent of the most powerful business leader in America lose their job, something is clearly wrong. This trend has continued and in such cases it's not just the CEO who suffers-so do the employees, partners, shareholders and even customers. And it's not just the CEO whose shortcomings create the problem, though of course he or she is ultimately held responsible.
What is the problem? Is it a rough business environment? Yes. Whether the economy is strong or weak, competition is fiercer than ever. Change comes fast and investors have turned unforgiving when companies don't deliver on their commitments. The most frequent explanation is that the CEO's strategy was wrong. But the strategy by itself is not often the cause. Strategies most often fail because they aren't executed well. Things that were supposed to happen don't happen. Either the organizations aren't capable of making them happen or the leaders of the business misjudge the challenges their companies face in the business environment or both.
Every one talks about change. In recent years, a small industry of changemesters has preached revolution, invention and quantum change, breakthrough thinking, audacious goals, learning organizations and the like. I'm not necessarily debunking this stuff, but unless you translate big thoughts into concrete steps for action they're pointless. Without execution, the breakthrough thinking breaks down, learning adds no value, people don't meet their goals and revolution steps dead in its tracks. What you get is change for the worse, because failure drains the energy from your organization. Repeated failure destroys it. These days we're hearing a more practical phrase on the lips of business leaders. They're talking about taking their organizations to the "next lever," which brings the rhetoric down to earth.