Every CEO or business owner has a big dream for their business and wants to make it happen. But how does a CEO sell/exit their business and ride off into the sunset with a sum of money that achieves financial freedom and a sense of contentment? A failure to plan leads to leaving money on the table and not experiencing the contentment you hoped for. This can put you in a place of overwhelm when there isn’t another hand or leg available to keep all the spinning plates in the air.
Any change you intend to make starts with a change in mindset, followed by implementing skills from your skill set inventory. We’re in the midst of discussing six skill sets that separate the best CEOs from the rest and today we’re talking about how a successful CEO needs to have a stakeholder connection mindset. CEOs deal with different stakeholder groups- board members, employees, clients, vendors, and possibly regulatory agencies. Studies show that relationships with external stakeholders can influence corporate earnings by as much as 30%.
The successful CEO starts with the why. Questions like:
- Why is the company worth operating in society? (Social purpose)
- Why are each of our stakeholders relevant to us? (Get to the essence)
- Why is communication with each stakeholder so important? (Moments of truth)
I work with a company whose core values are to 1) serve the community they work in, 2) treat stakeholders like family, and 3) do the right thing. The CEO of this company sets up community service workdays for employees and encourages charitable donations to organizations the employees believe in. A social purpose exists in this organization beyond just making a profit and increasing shareholder value.
Treating stakeholders like family means spending time in relationship with all their various groups, employees, vendors, and other stakeholders. It means really understanding each person or group of persons by considering their point of view. That understanding comes from effective listening and empathy to be sure that person is understood. A CEO has to get to the essence of the point of view of each person or group. It’s important to understand ‘what’, but the best CEOs go the extra mile to understand ‘why’.
Finally, all CEOs face those moments of truth where mistakes may have been made, or communication created a misunderstanding, and there are dollars at stake. The best CEOs have to stay elevated. This CEO mentioned above has implemented a core value of doing the right thing, even if it might mean taking a loss. There’s no harm in hoping for the best as long as you’re prepared for the worst.
With a stakeholder connection mindset, a CEO and company will:
- Have a social purpose practice and embed that purpose in their core values.
- Get to the essence in stakeholder conversations by spending time outside and understanding each stakeholder groups’ “why”.
- In those moments of truth that test the CEO and the organization, show personal resilience and maintain a long-term perspective.
With each of these together, you can build value for your stakeholders, create and maintain a successful company, and help stakeholders connect to a higher sense of purpose.