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Within a CEO's ambition, there is a sense of nobler mission that rallies not only the leadership team but the entire organization. Bain partners James Allen, Nicolas Bloch, Karen Harris, Elizabeth Spaulding and Patrick Litré discuss how CEOs can stretch their ambition to reach all aspects of the business, from technology to transformation strategy.
Read the transcript below.
JAMES ALLEN: Great CEOs create these extraordinary ambitions for their companies. Strategy produces lots of targets...within their ambition or target-setting and financial targets—but there's always something more. There's always the sense of nobler mission that rallies not only their own leadership team, but also the entire organization.
NICHOLAS BLOCH: It's important when you create the ambition, or the way you define the ambition of your company, that this ambition reflects the value-drivers of the industry. What we found is 80% of the value captured in industry is usually captured by two players only. In 60% of the cases, this is a scale leader. But in 40% of the cases, it is not the scale leader. And therefore, depending on what you choose, it's important that the ambition reflects that.
What I found the most inspiring CEOs do [is], they stretch the ambition in a way that reflects those value-drivers. Some that are driven really by scale will stretch an ambition that reflects that and will create, reinforce, the leadership as a strong value that they want to push, and reflect that and stretch leadership ambitions.
On the other side, other CEOs, what they will do is, especially when scale matters less, they will focus the ambitions on other value-drivers, like customer loyalty or hijacking some of the profit pool of the industry.
ALLEN: One of the things I've seen of really good CEOs is somehow, they return their company to the sense of insurgency. You know, every company starts as an insurgent in their industry, at war against the industry on behalf of under-served customers. And the really good CEO, no matter how big the company is, somehow returns to that again and again: that we are insurgents, we are the ones that can handle turbulence. And that really rallies not only the leadership team, but my goodness, it gives such a sense of purpose to everyone in the organization, especially the front line.
KAREN HARRIS: Part of ambition is embracing the future. That means making sure that you as CEO position your company, your shareholders, your team, to be part of the disruptors, not the disrupted. And for every company, there are one to three macro-trends that really matter, that will really impact your business. And for a CEO, that means identifying those trends and creating a common vision for what they are and how they might disrupt your business.
ELIZABETH SPAULDING: What I often see as the most bold ambitions—the ones that are the most inspiring, motivating, and game-changing—are those that are based on digital technology: a reshaping of a core strength and taking it into the next generation. There are few things as powerful as what technology can do to recreate and reshape the strength of the business, and one that an organization gets so excited to be a part of.
PATRICK LITRÉ: The best CEOs recognize that the right ambition will inspire the people and create the energy required for the road ahead, which is often a difficult road to transformation of a business. And there are two elements to that. The first is getting real alignment and commitment from the top team. And that requires for the CEO to set the right context—sometimes the brutal facts about the business—but invite the team to contribute and make proposals. And that's not a one-shot deal. This is an orchestrated, multi-step process, to get the team really committed to that ambition.
The second is to capture the hearts and minds of the organization with the right story. We tend to focus too much sometimes on the left brain, the facts and figures. They're important. But stories and metaphors, the things that bring the future to life for people, are also critical. The lower you go into the organization, the more important that is. So [it's about] creating a good sense of what does it look like when it's finished, as well as the journey that we need to go through, with the right leading indicators and principles for the journey.
With those two elements, we can really create the compass that will help people make the right decisions and align their behaviors and actions along the way.
First published in 9月 2016