Expanding the Leadership Container: Increasing CEOs' Capacity for Success — March 2024

There is no job with quite the step-up as that of CEO. Leader after leader in the position reiterate that there was just no way to be fully prepared. Even if a mandate seems perfectly clear, the means of accomplishing it today are usually not, especially in these highly unpredictable working environments of excessive disruption and confounding complexity. So, it is hardly a surprise that over the four years that we have been publishing CEO Insights, we have seen a remarkable expansion of the role--both in terms of greatly increased expectations from a wider group of stakeholders and a remarkable change in the essential capacities required to get the job done well. What used to make a good CEO is still important, but it is not enough. Now, these leaders know that they must keep evolving throughout their tenures if they are to have a chance at bringing their organizations to the levels of both performance and transformation desired. 

The big questions for active CEOs and those who are anticipating stepping into the top job (and boards looking for those candidates for succession) are twofold: What are leaders finding they need to lean into and to develop further as sitting CEOs, and how can they accomplish this, all while leading the world’s massive enterprises? 

The Need for More Capacity 

We regularly survey CEOs and meet in forums, at dinners, and in workshops to discuss these very questions. On the big points, the answers are amazingly consistent and complimentary, even across sectors and company type. What is clear is that today it is not enough to come into the job with proven capability on the important competencies alone: influencing and collaboration, team leadership, change-making/innovation drive, and customer orientation, for example.  Now, to lead successfully through the rampant uncertainty of the present and future, CEOs need more; they need an expanded leadership mindset to create the space and stimulate the growth their organizations require. A leader’s capacity is based on the structure of his/her thinking or their mindset—not what they think but rather how they think about it. The reality is that all the tools in the world will not permit change if one’s mindset does not support that change. 

Integrating More Vertical Development 

In the past, leadership programs have centered primarily on horizontal development and therefore on adding to the relevant knowledge, skills, and competencies which sharpen what CEOs know and what they do. This way of supporting CEOs has served well for a long time and continues to. Still, as the world is becoming increasingly less predictable and more complex, increased attention to the vertical development of leaders’ underlying thinking structures has come to matter more. 

Vertical development refers to advancement in a person’s thinking and therefore aims to influence how leaders conceive ideas and how they understand the world. So, in addition to considering which competencies best fill a leaders’ being or their container, we now need to keep developing and strengthening the container itself--to better understand how it is currently structured, how much it is holding; moreover, how it can expand to hold more (or build capacity). 

When CEOs can integrate this mindset development and grow in both horizontal and vertical directions, they become greater versions of their current selves, and they find themselves better equipped to lead impactfully through emerging, often challenging, situations and into future. 

Today’s Most Essential Leadership Capacities 

CEOs are finding that three capacities have become essential as the most promising enablers for the growth they are seeking. (There are others, certainly, and some jobs may require more of one than another but these three are constantly coming up as most important.)      

SELF-AWARENESS

It all starts here – in the self and what we are paying attention to. CEOs benefit by looking inward and working to improve their sense of self-awareness. This entails a commitment to self-reflection and introspection--keeping an eye toward broadening the solution space. With this work, CEOs aim to: 
  

• Better Identify the values and motivations driving their behavior
• Understand the behavioral impact on the team and, by extension, the organization  
• Assume their role with a commitment to discovery and growth—as the mid-point of their career experience, rather than the culmination of their own personal and professional prowess 
• Staying open to ongoing learning and expanding their knowledge in order to boost the leadership skills and effectiveness

RELATABILITY

By their own assessment, CEOs believe they still have room for improvement in honing their ever-important relational skills. Many relay what we might call a relational deficit.

CEOs we have worked with discover that investing in greater self-awareness is the key to unblocking relational challenges. Learning more about themselves unlocks the curiosity to really learn about others and how to actively listen to what is going on in their teams and in the world. By enhancing their relational abilities, CEOs are seeking to:       

• Listen with curiosity and humility, to learn, not to fix (or win) 
• Develop a sacrosanct relationship with the team and the board 
• View stakeholders as gateways to new possibilities rather than parties to manage 
• Learn from experts to test their own thinking and make informed decisions

ADAPTABILITY 

Finally, CEOs told us that they need to further expand their capacity to adapt quickly and effectively to today’s many challenges. To get there, CEOs need both the will and ability to change nimbly, to keep learning, and to navigate through complexity and ambiguity. At the base, it is about keeping an open mind and having the courage to try new things when necessary. CEOs who are clear-sighted and become more adaptive can find innovative solutions to complex problems by:
         

• Managing and working with paradoxes, and finding the right balance between long and short-term strategies
• Tapping institutional strengths to energize and stretch the organization to move forward
• Developing an inspiring vision to lift the collective ambition of the business, team and board 
• Being bold and determined to reach new heights while remaining flexible about the best way to meet the goal      

These three capacities are interdependent. They grow and enhance one another. To develop the curiosity to be truly adaptive, for example, CEOs need to master the relational capacity to listen, to bring a broader set of stakeholders into the conversation, and to communicate authentically and inspire others. That, in turn, requires these leaders to keep honing their capacity for self-awareness, drawing on the help of others to illuminate their blind- spots and habitual responses, as well as their sources of energy and meaning. 

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All over the world, CEOs are telling us some version of the same thing: “You can’t expect everything to change while you stay the same.” The good news is that they have learned through direct experience that they can indeed change and keep growing while leading the existing ship. As one CEO noted, “The massive setbacks of late have also brought with them an enormously high willingness to change” “Suddenly everything has become conceivable,” another added.

This willingness is pushing CEOs to extend the former borders of their leadership containers, into the leadership mindsets required more now. By recognizing their need for extra capacity (for greater self-awareness, reliability, and adaptivity most obviously at present) and creating the conditions to meet these, today’s CEOs are successfully tackling the less precedented leadership circumstances surrounding them. And they are also equipping themselves and their successors for the even lesser-known challenges still looming ahead.