I’ve worked for CEOs who managed boards and those who were managed by their boards.
The former is a more enjoyable working experience.
There is a reason why the board feels the need to manage the CEO. In most cases it’s because the CEO is continuing to underperform but there is something blocking them from replacing the CEO.
Boards are immensely helpful as idea partners. They offer unique perspectives and can pattern match at a higher rate as they work across tens of portfolio businesses.
However, when they actively begin to manage the CEO, problems surface.
Here’s my experience working for an ineffective CEO who was managed by their board:
The CEO and company were struggling. Revenue down, churn up, and team morale at an all time low.
The board had lost trust in the CEO due to poor hires and lack of decision making (the CEO bought into hiring people and letting them do their thing with little oversight). The CEO became gun shy and incapable of making decisions. And when decisions were made they were reversed the following week or altered.
I joined after two executives before me failed (unbeknownst to me, but I regress).
Multiple investment firms sat on the board. Each had their own thoughts on how the business could be turned around. The CEO was the largest shareholder but lost the pulse of the market.
We’re getting to the bad part.
Shortly after onboarding I began receiving emails from board members with actions and requests. Not suggestions but tasks with timelines and demands for calendar time. Most of the actions went against the CEOs priorities and my plan as the marketing leader.
I shared this with the CEO.
In previous instances, I’ve had CEOs place blockers between their board and the team. (And I’ve placed blockers between the board and my team when I reported to the board.)
Instead of the CEO setting the precedent, they responded with “do what you feel is best”. This is a non-answer much like other decisions the CEO refused to make.
These requests continued for months. And across the entire org. The firms were not aligned and throwing things against the wall attempting to drive change to improve the business.
Product, sales, and customer success were sent chasing their tail.
The CEO again had deferred decision making and leadership to others.
The CEO went out on a limb several times and was burned. They lost trust and instead of trying to right the ship to win back trust. They caved.
Fast forward many months and the CEO was pushed out of the company. So were several C-Suite executives.
Many others, including myself, left.
The moral of the story is to lead. Drive the company and protect their time. Set the vision and allow the team to fulfill it.
But you must have a vision as the CEO. You can not let the board dictate their vision. Instead use their ideas and input to craft and influence yours as the CEO, but not replace it.