Executive teams play 2 critical roles in an organization.

The first is obvious; they provide strategic and operational leadership to the company. They set goals, develop strategy, and ensure the strategy is executed effectively.

The second is less obvious, but just as important; the executive team provides the organizational and cultural DNA for the company. How well the executive team functions as a collective leadership body and how its members interact serves as the model that teams throughout the company will follow.

Executive Team Effectiveness

You could fill entire libraries with the books and studies written about strategy and operations. The second role of the executive team, though, gets less press. Because it receives relatively little attention, team effectiveness can be the basis of a significant competitive advantage for companies.

In our recent survey of senior executives, 65% indicated their executive teams were experiencing a clash between functional and enterprise accountabilities. But fewer than 1 in 5 rated their executive teams as “very effective.”

Nearly all executives surveyed agreed that “increased effectiveness of my executive team will have a positive impact on organizational results.”

In other words, when the executive team functions better, the whole organization functions better.

Defining Effectiveness

The best executive teams are characterized by 3 vital threads that run through everything they do.

Strategic focus. Effective executive teams establish a vision for the organization and invest considerable time and energy at the strategic level. They balance risk and innovation, anticipate future needs and opportunities, and seek to ensure the organization’s sustainability.

Collective approach. Top-performing executive teams work together, taking an enterprise-wide view of their individual and team functions. They model for the entire organization ways to break down silos and develop solutions to business problems together. Individuals on top-performing executive teams prioritize the interests of the organization over individual gains.

Team interaction. Finally, the best executive teams are intentional in their interactions. They value their differences, listen and communicate well, seek input from each other, and trust and respect one another. These behaviors make teams more effective. Crucially, they also model for the rest of the enterprise what team interactions should look like.

Building a High-Performing Executive Team

Part of every CEO’s job description should be to “build and develop a world-class executive team.” This is challenging, because the qualities that typically earn senior executives a place on the executive team are necessary, but not sufficient, for peak performance on that team.

So how does one build a highly effective executive team? There are 5 keys:

  1. Get the diagnosis right. The CEO or top leader at an organization should understand what drives individual executive-team members and what makes them work — or not — as a group.
  1. Get the leadership mental model right. Executive team members must have an explicit understanding of, and agreement with, what it means to lead at the enterprise level. Senior executives must understand that their role on the team goes beyond functional responsibilities.
  1. Get the mindset right. For seasoned leaders, the executive team shouldn’t represent the summit of their professional development, but rather a new challenge that requires them to continue to learn and grow. They must also bring this perspective to their direct reports and others they interact with, encouraging them to develop beyond their technical expertise.
  1. Get the interactions right. Creating explicit “interaction rules” to guide how team members interact with one another is critical to building effective teams. Members of the executive team must be transparent, vulnerable, and comfortable learning in public; they must also have strong communication skills.
  1. Get the diffusion rules right. Finally, executive teams are only effective when their decisions, thinking, and behaviors can spread quickly across large numbers of people at all levels of the organization. This ensures that strong, healthy executive team actions and values can be modeled by other teams throughout the enterprise.

You may be wondering whether your company is getting all the value you could out of its executive team. To learn more about effective executive teams, symptoms of ineffective teams, and tools to evaluate and improve executive team performance, download our new white paper “Are You Getting the Best Out of Your Executive Team?

2 thoughts on “How to Tap the Full Potential of Your Executive Team

  1. Nancy SSY says:

    Well diagnosed

  2. Couldn’t agree more, though I believe these are base tenets required for any level of an organization excel. They aren’t taught, and most who operate with these principles coming up through the ranks find themselves left behind to those that don’t. People leaders at every level need to look into the mirror.

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