# 145: What the CEOs Are Saying

“Leaders are the emotional thermostats of those they lead, and our habits as leaders can spread like a contagion” – Chip Conley

Dear Friends

At the end of last year, I asked how I could improve this letter.

Many of you were kind enough to send detailed feedback. Thank you.

I posted some of the positive comments here.

I shared them, because, like you, I tend to zone in on the ‘things to be improved’ but success also requires building off our strengths. I was coaching myself.

As I reviewed the feedback, I realized that something had been happening beneath the surface, unconsciously for me, but visible in your feedback.

The last three years of writing have created an addiction to writing. The more I wrote to you, the more I wanted to do.

My aim is to take complex subjects about strategy, soul, and self and offer them to you in ways that are digestible, actionable, offer fresh perspectives, and inspire you with new possibilities.

But, fueled by my unconscious enthusiasm, the letter was getting longer, and the themes more expansive. It risked becoming hard work for some of you and you were generous enough to tell me so.

Not everything needs to be in the letter, and what is in it can be better crafted.

Thank you for highlighting the shortcomings. It takes courage to offer critique and care to do so in a way that inspires change. I’m working on it!

Last week we saw Grammy Award-winner Gregory Porter perform.

Roxanne insists that I tell you that she booked the tickets, that I would’ve missed the event and then been sad. She’s right, I tend to delay acting on things that would make me happy – an ongoing journey. She knows this, so she booked. We went and were both happy.

Ordinarily, I would’ve tried to squeeze the experience in here, making this letter too long and not doing justice to the experience. Instead, I wrote a separate piece and shared it here.

Please do comment, I’d love to know what you think. It’s an experiment. It might be the beginning of something new…or not.

All that I will say here is that people were arriving with the sexiest cooler boxes. Imagine a Fiat 500 or a Mini Cooper, but for your bubbles. That sexy! I wondered who Field Bar is and was delighted to discover that it’s a Cape Town company.

/ Strategy: Make Time to Reflect

On 26 January 2020, I wrote my second ever official newsletter.

It said, “This week PWC released its Global CEO Survey with the words ‘we see a record level of pessimism’”.

Of course, at the point that they did their survey, Covid was a faint whisper. Six weeks later all that changed, and it’s been three long years since.

Two weeks ago, they released their 2023 CEO Survey.

It includes this line, “CEOs are extremely pessimistic about global economic growth for the year ahead”.

Sound familiar?

73% of the 4,410 CEOs surveyed expect economic growth to decline – a 38% increase from 2020’s levels of pessimism.

The record was shattered.

The CEOs identify inflation and macroeconomic volatility as the two most prominent risks both for the next 12 months and for the next 5 years.

What does this mean for us?

At the simplest level, uncertainty. Both make the world less predictable.

Practically, if you need to be playing defense, protect cash and ensure you’re not overleveraged either individually or as a business. If you’re in the fortunate position of having cash on hand, you might explore a more aggressive strategy.

Emotionally, we’re not great in unpredictable circumstances. We’re on high alert against threats. We’re defensive. When we’re defensive we miss opportunities, we get angry quicker, we’re less creative, and we destroy trust. Ironically, everything that we need right now.

We need trust to perform – indeed PWC reflects that trust is closely tied to financial performance (Harvard Professor, Amy Edmondson is one of the world’s leading thinkers on creating high-trust environments) –we need to be strategic and we need to engage the wisdom of those around us.

The CEOs reflect that they spend 53% of their time on driving current operating performance, with the remaining 47% focused on evolving the business and strategy to meet future demands. They think that is inadequate. They want to shift the ratio to 43:57 – a 20% increase in the time spent on strategy.

Strategy is creative. So, CEOs want to be more creative under conditions that do not immediately facilitate that. It will need a deliberate and intentional focus to create conditions conducive to creativity.  Without it the momentum of the last three years will have you defaulting to an uncertainty-based fear response diluting trust.

The CEO role requires thinking and acting to create the future. It is the job. Your role may not require as much time, but every role, and certainly every life, demands and deserves some level of investment in clarifying your strategy for your future. Without the strategy you may end up somewhere you don’t want to be.

Pause here.

How much of your life is spent meeting everyday objectives and how much is invested in creating a vision of the future?

PWC’s data suggests that whatever that number is, increase it by 20%. If it is currently zero, well then…

If your business is going to create the future, you need the collective intelligence, intuition, and effort of everyone in your business. To get that your teams need to be engaged.

Sadly, 43% of the CEOs think that their business’s leaders rarely encourage dissent and debate and 53% think that their leaders don’t tolerate small-scale failures.

Encouraging diverse opinions and creating the freedom to try and fail on non-critical experiments are the source of the future. With these numbers, in the best-case scenario, at least half of the world’s business potential is being crushed.

(Marcus Buckingham and Ashley Goodall are excellent guides to liberating the power of your people.)

Hospitality entrepreneur and Airbnb’s Strategic Advisor for Hospitality and Leadership, Chip Conley reminds us that leaders are the emotional thermostats of those they lead, and our habits as leaders can spread like a contagion.”

/ Soul and Self: Your Future Vision influences Today’s Actions

I think it’s safe to say that most of us have already abandoned some of, or failed to activate all, our New Year’s resolutions. I certainly have.

No fear. We can start to improve our lives at any moment. It just requires taking the time. This is an abbreviated version of a process I have been doing with many of my clients. It may help you.

Schedule three one-hour appointments with yourself over the next two weeks. Keep a few days between each appointment.

For all the below questions, write down your answers. Writing will clarify and deepen your insights.

In the first appointment, answer the following questions in terms of your personal life, and your professional life. If you run a team or a business, you can use the same framework.

Reflecting on 2022:

  1. What successes do you want to build on?
  2. What risks have carried over?
  3. What opportunities haven’t you yet maximized?
  4. What did you learn?
  5. What regrets do you have?
For the second appointment, visit the future. Think about what you’d like these people to say to you in December 2023.
  • Yourself.
  • Your boss.
  • Your colleagues.
  • Your customers.
  • Your husband/wife/partner.
  • Your friends (Write down different friends’ names, there’ll probably be a different answer for each of them).
  • Your children (Again, give an answer for each child).
  • And, if a stranger saw you walking down the street, what would they say about you?

In the third session, review your notes and ask one simple question, “Given the insight that I have created, what actions do I need to take?”List them. Do them. Your year will be more effective.

I wanted to tell you about Futhi Ntshingila’s They Got To You Too and Sue Nyathi’s An Angel’s Demise. It will have to wait for next week. We’re out of space.

Best wishes as always!

Karl

PS: If you’d like to work with me, you can find out more here and subscribe to this letter here.
PPS: If you live in South Africa and power outages are infuriating you, this is an excellent overview of how we got here. Understanding history helps us change the future.

Strategy, Soul and Self

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