The world is changing faster than ever, but the narrative of leadership remains dominated by talk of such larger-than-life visionary prophets as Steve Jobs and such executive warriors as Jack Welch.
This iconic CEO is powerful and patrician; a bold, charismatic extravert with a flawless résumé. An oracle of business judgment who jets around the globe, from Davos to Detroit, with superhuman confidence. A brilliant strategist who shapes the reality in his path. It’s a story we, the public, have been absorbing for decades.
Eight percent of CEOs in our sample did not even complete college or took unusually long to graduate.
But then there’s Don Slager. He grew up in a blue-collar community a short distance from Chicago and the Gary Works steel mills in Lansing, Illinois. He was surrounded by welders, truck drivers, and steel-mill workers—not college graduates. For Don, at the time, there was no CEO next door. He went to vocational high school with aspirations to become a builder, but graduated into a bum market for construction. Instead, he started his career driving a garbage truck. For the better part of six years, he punched in at 2:45 am, started driving at 3:00 am, and endured the thankless monotony of his route for ten to twelve hours a shift. At the end of each week, he collected his paycheck and prepared himself to start the routine again.
But here’s the strange thing: Don is, in fact, a CEO. Don is a great CEO. Under his leadership, stock of Republic Services—a Fortune 500 powerhouse in the waste services industry generating over $9 billion in annual revenue—outperformed S&P average returns between 2012 and 2016. In 2015, Republic Services outperformed the S&P by eight times. Since Don took the top job, Republic Services’ market cap has nearly doubled from $11.5 billion to $22 billion as of midyear 2017. Based on anonymous and voluntary reviews by Republic Services’ employees, Don was recognized with the Glassdoor Employees’ Choice Award and named to Glassdoor’s 2017 highest-rated-CEO list. Don’s journey from the garbage truck to the corner suite may sound unusual, but it is not an anomaly.
Determined to understand what “CEO material” really means, we undertook 17,000 interviews with CEOs worldwide. The results are enlightening. It turns out that everything you might think about CEOs may be wrong.
Here are some of the most common misconceptions about what makes someone a CEO:
Only Ivy Leaguers need apply. In fact, only 7 percent of the CEOs we have analyzed graduated from an Ivy League college. Eight percent of CEOs in our sample did not even complete college or took unusually long to graduate. Ivy League graduates are more prevalent among the ranks of Fortune 500 CEOs, but outside of that small set of the largest companies, we see a much broader range of educational backgrounds and pedigrees.
CEOs were destined for greatness from an early age. Over 70 percent of the CEOs we interviewed didn’t set out to become CEOs early in life. Only when they came within reach of the C-suite—typically after 15-plus years of experience—did they start to feel that maybe they could achieve and thrive in the role.
Statistically, gender has no impact on the probability of delivering strong results as a CEO.
CEOs are egotistical superheroes. We were intrigued to uncover that the CEOs who saw “independence” as their defining character trait were twice as likely to underperform compared to other CEOs. The weakest CEO candidates used “I” at a much higher rate than “we” compared to the rest of the CEO candidates. For many successful CEOs, this team orientation has its roots in early organized athletics and in mentoring others.
Successful CEOs have a larger-than-life personality with exceptional charisma and conﬁdence. Wildly charismatic “masters of the universe” may prowl unchallenged in the boardrooms shown in Hollywood films, but, in real boardrooms, results speak louder than charisma. Over a third of CEOs in our study actually describe themselves as “introverted.” And self-described introverts in our sample were even slightly more likely to exceed their boards’ expectations. When looking at CEOs who met expectations, we found no statistically significant difference between introverts and extraverts. High confidence more than doubles a candidate’s chances of being chosen as CEO but provides no advantage in performance on the job.
To become a CEO you need a ﬂawless résumé. The reality: 45 percent of CEO candidates had at least one major career blowup that ended a job or was extremely costly to the business. Yet more than 78 percent of them ultimately won the top job. What set successful CEOs apart was not their lack of mistakes but how they handled mistakes and setbacks when they did occur. CEO candidates who talk about a blowup as a failure are half as likely to deliver a strong performance as a CEO.
Female CEOs succeed differently from men. Women may deploy leadership styles and exhibit attributes different from men’s, but statistically, gender has no impact on the probability of delivering strong results as a CEO. Successful CEOs exhibit the same four CEO Genome Behaviours, whether female or male. Where it matters, female and male CEOs appear more similar than different. Unfortunately, the one big difference remains. Depending on the year, only about 4 to 6 percent of the largest companies are led by female CEOs.
Great CEOs excel in any situation. A common misperception is that a great CEO is capable of handling any situation. Actually, we find that great CEOs are very thoughtful about identifying the roles and context where they can be successful. They have the self-discipline to turn down the wrong job even when it comes with a CEO title. Many CEOs who are great at turning around a struggling company may struggle in a high-growth context and vice versa.
To become a CEO, you need to check every box. Everyone has areas for improvement, and CEOs are no exception. Even the best-performing CEOs have three to six key development areas to improve when they get the job. Those who succeed quickly surround themselves with the right teams to complement their skills and experience.
CEOs work harder than the rest of us. CEOs, of course, work very hard, but so do others in a wide range of jobs. Analysis showed no predictive relationship between how hard a leader worked and how likely she or he was to become a CEO. Furthermore, 97 percent of low-performing CEOs in our sample scored high on work ethic.
For CEOs, the smarter, the better. Above average intelligence is an important indicator of C-suite potential. However, once at the C-suite level, higher intelligence as measured by standardized tests does not increase the odds of being hired as CEO or performing well in the role. In fact, CEO candidates who “cut to the chase” and speak in clear, simple language are more likely to be hired than those with complex and cerebral vocabulary.
Experience trumps all. Among the more shocking findings in our research: first-time CEOs were statistically no less likely to meet or exceed expectations than those with prior CEO experience.
This is an edited extract from The CEO Next Door: The Four Behaviours That Transform Ordinary People Into World-Class Leaders by Elena Botelho and Kim Powell, published by Virgin books.