Evaluating and Replacing Leaders
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A strong leader must constantly be evaluating senior leaders, she says, based on their ability to think comprehensively about the impact of their decisions, "because people can get pretty myopic. I like to see leaders who have a particular focus, but I want them to be operationally sensitive and thinking about the impact of their work on many stakeholders."
In evaluating how senior leaders are doing, she focuses on their ability to build a cooperative team and to execute and drive change effectively.
"There's a whole list of those competencies, and then there's others related to the strategic elements of the organization. The metrics we're using measure outcomes across a variety of categories," she says, including quality, financial performance, and community mindedness, among others. Those are the common ones, but she evaluates leaders regularly—that is, many times a year—on seven strategic categories that are specific to their business units. She's careful to constantly evaluate and be available personally for course corrections because she wants leaders to be confident and aware of where they stand at any particular time.
"A lot of collegiality and teamwork is necessary," she says. "That means telling stories and confronting issues at the moment you see them."
She says if CEOs are consistent in their standards, there will be some natural attrition, but she doesn't put much stock in any rote suggestion that, for example, 10% of the bottom performers in an organization should be culled every year. Some people can perform well for years and then get burned out and need to do something else. Sometimes it's time for people to move on to new roles, and that's healthy.
"The main thing is we have discipline on maintaining high standards of performance and behavior," she says, adding that she's careful to keep the evaluations professional—equating people's worth with how effective they are at their jobs happens more than CEOs like to admit.
"Over the years I have seen enough change that I've seen people who are completely ineffective move to other organizations and be very effective."
So sometimes it's not the people, but perhaps the fact that they are in the wrong place with the wrong people surrounding them.
"I still get Christmas cards from people I've fired because I never diminish them as people even if their performance wasn't as effective as we needed," she says.
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