CEO’s are hired or start companies invariably because the shareholder that hires them or the shareholder within them wants to make money. A shareholder’s request of any CEO is a simple one: “Show me the money”. That’s where it ends. A CEO must answer this call.
Yet… A CEO must somehow marry the shareholder “I want ROI” need with something a bit more motivational for staff. Mmmmmm… not so easy. And this is where it’s easy to become unstuck.
If you are familiar with Dan Pink and Maslow, you will know that when humans get beyond the need to feed the family, the need to increase output for financial gain becomes largely irrelevant for non-manual work. All scientific studies point unequivocally to financial targets having unintended consequences.
If I demanded that you give me £50,000 by the end of play, with a gun at your head, I suspect you would very quickly think about immoral solutions. Robbing a bank? Doing a drug deal?
By focussing people on financial targets, you get very undesirable results. This is the root cause of the banking crisis a few years ago… which still hasn’t been addressed…
So how do you motivate teams to higher things? A most ingenious paradox.
Every business needs a purpose. A reason to be on the planet. A reason to make a difference. A reason to get out of bed in the morning. A reason that transcends logic.
If you know your purpose, then you have it. The CEO’s must be the best standard bearer in the company.
If you don’t, then fret not:
- Let the staff run the business. If you can’t, then you are no CEO.
- If they don’t know how, then train them.
- Ask them about their purpose. In there, you will find it. There is one.
Now, nail those colours to your mast and go global.
Don’t set financial targets.
You must think differently.