12/29/2014 08:41 am ET Updated Feb 28, 2015

Why So Many CEOs Are Struggling Today


Marissa Mayer's mounting troubles at the helm of Yahoo illustrate just how complex and tenuous the world of the CEO has become. She's made no big blunders, yet, after just two years it appears the clock is fast running out on Mayer's tenure. It's a cautionary tale but not unique in today's revolving door boardrooms. Most top executives I provide counsel to today work beneath a sword of Damocles with very little margin for error and fast-ticking clock. Making matters worse, there are some new, important dynamics at work that make being a chief executive tougher than ever. In fact, many senior leaders today are being buffeted by forces beyond anyone's control. Yet, managing these new forces is essential for today's C-level leaders.

Here are a few examples of what's different now:

The corporation itself is becoming an anachronism. It's a law of the Information Age: when you empower individuals you imperil organizations. Look around: unions, churches, political parties are all less influential than they used to be. It's the same for corporations. The center can no longer hold, the corpus no longer serves the same purposes it once did. A hold-over construct from the Industrial Age, the corporation is a Underwood typewriter in an age of iPads.

What was once efficient about the big corporate model--centralized, in-house functions warehoused together and professionally managed--is now terribly inefficient. Moreover, Frederick Winslow Taylor's scientific management process--which still influences us today--is predicated on the principle of enforced cooperation (his term). By standards of old, today's workforce is virtually unmanageable; independent, self-reliant, unfettered and unafraid. The prevailing idea of the corporate workplace is not long for this earth. Warehousing employees together to enforce cooperation is wasteful and ultimately less productive in our networked age. At the same time, every single function that can be automated will be automated.

The true value of the corporate entity is changing. The corporate empire is disintegrating and atomizing in the same way mainframe computers gave way to distributed, networked and then massively mobile computing. The future corporation will be composed of a small loyal core of key people surrounded by a constellation of affiliated and networked specialists. Think apps around an operating system. This is a new reality for many senior execs.

Ants are dumb, but ant colonies are very smart. Too many CEOs like Mayer imagine themselves as "the next Steve Jobs." I doubt if even Jobs could be himself in today's new operating climate. The CEO as cult figure is a waning notion. What advantages the corporation still has comes from the collective brainpower of all its employees. The CEO may be privy to more information than the rest of the employees, but he or she is not smarter than the collective. As many CEOs learn the hard way, organizations won't go where they can't go. CEOs need to be in tune with the heartbeat of the organization, know its strengths and limitations. The idea is not to communicate by fiat outward but to open pathways of insight inward. Today's strong CEO is not a fearful, mercurial figure but rather someone who is able to listen well, discern patterns, make analogies, get organizational buy-in.

Many executives don't know what really inspires and motivates employees. Coming out of B school, or worse, engineering school, even the most charismatic CEOs tend to lack sufficient empathy for the true headspace of the rank and file. CEOs are paid to keep score--revenue, EBIT, profit, market share, share price. What's often missing is the humanity. In his recent TED talk psychologist Thomas Suddendorf asserts that what separates humans from other animals is "our open-ended ability to imagine and reflect on different situations, and our deep-seated drive to link our scenario-building minds together." The best CEOs are able to link scenario-building minds together in common cause. They work very hard at communicating well and often.

Today, employees want to do meaningful work for a company that matters for as long as it makes sense to both parties. Senior leaders, you need to make your company matter; allow your employees to make meaningful contributions, keep them challenged and inspired. People want a chance to do the best work of their careers. The CEO's first job is to make that possible.