Who wrote the book on being a successful CEO? We could start with Sun Tzu and Marcus Aurelius before getting into the scads of contemporary how-to publications.
But one particular book has garnered attention for its sound and practical advice coming from someone who knew from experience.
Kraig Kramers was one of the most thoughtful exponents of the art and science of being a CEO. In 2002 he published CEO Tools: The Nuts-N-Bolts of Business for Every Manager’s Success, and got positive reviews for its approach.
Kramers was, over the years, a CEO of eight companies and was in demand as a speaker around the country to CEOs, universities, and management groups. He was asked to speak to a group by Jim Canfield, an executive manager with strong Memphis ties who has brought diverse CEOs together to learn from each other.
The two became friends and Canfield was impressed not only by CEO Tools, but by Kramers’ presentation, which had an impact above and beyond the typical lecture. It had staying power, and CEOs who heard him buzzed about him and his ideas long after.
Kramers died in 2014, “which prompted many of those who had heard him to wonder if there was a way to continue his message,” Canfield says. Richard Kopelman, CEO of Aprio, LLP in Atlanta, acquired the CEO Tools assets and chose Canfield to write the new version of Kramers’ book.
“The timing was right for me to do something new,” Canfield says. “I was familiar with the book and had an affinity for Kraig, so we considered building that consulting and coaching practice around the continent. It was already great content, but it was written back in 2001 and a lot had changed since then, so we wanted to add whatever would make it relevant today and tie those great stories together in a way that a new reader can access and implement.”
One big change was taking into account the changes in technology. “A lot of it is how we communicate,” Canfield says. “Though some concepts are the same, we’ve actually gained a lot and lost a lot. It’s easier sometimes now to send an email to someone who’s just two cubicles away, than it is to have a conversation. And yet, we know that it’s in that conversation that we learn and engage so much more, and that trust is built in such a different way, that I think it was important to say, to remind people, how is it we build trust in personal communication? Part of it is knowing people personally, and the second is being able to listen to what they’re saying in a way that has them felt heard, not just listening to wait until we speak next, because I think too often that’s the case.”
Canfield, as a frequent speaker, will remind his audience that he’s not revealing much that’s new about setting direction, tracking metrics, and hiring smart, but that there’s a big difference between knowing and doing. “I’ll tell my audience, ‘If I was here to talk about health and fitness, do you think I’d probably talk about diet and exercise and water and sleep? Not all of us are practicing that as often as we might.’ So part of it is reminding them that there are things that are still important today even as we have all these technologies that are now supporting the way we might run our business.”
In fact, he says, metrics offers a fine example. “With the amount of data that can now be collected, information is readily available. Sometimes what we miss is about tracking and then creating a feedback loop so that people can interpret what’s being tracked, and then change behaviors to get a result that we really want. Sometimes I think we’re better at tracking things, than using them. It’s not just that data and information are readily available, but how do we use that to get the results we want?”
Another thing Canfield added to the book was how to create an autonomous organization, one that gets back to thinking about process and systems, as opposed to just relying on people. “This is important for two reasons,” he says. “In relatively recent surveys by Wells Fargo, when they talk to their CEOs and business owner clients, 85 percent are still reporting that they have to be available day-to-day, or work in the business day-to-day just to keep the basic business moving. That chapter was really meant to say that there are some ways to get yourself out of that position, and let the organization run and really depend on the people that you hired to do that work, and try to get out of the way. It was a new chapter for the book, and it was one that I felt really compelled to speak to.”
Canfield recalls the old saying that fish can’t see the water they’re swimming in. “In some ways, the entrepreneurs are the last to see what’s happening,” he says. “Yes, things are delegated, but then someone comes back in and takes it back, or they’re too engaged once it’s delegated. My advice would be, ‘Your job is to move from being a manager of the business, to a CEO of the business, to an owner of the business. That’s your natural progression.’ It’s almost as natural as getting married, having children, then becoming a grandparent. Your love of the family is still the same, just like your love of the business is still the same, it’s just your role shifts over time. I think too often they get stuck in the direct parenting mode, in some cases past the time that it may be necessary or even valuable to be in that role.”
Since CEO Tools 2.0 is about tools, Canfield had taken the liberty of adding another one, the What’s Next Tool. “It’s designed to allow a company to think about the future, because oftentimes we get so busy with what’s happening today,” he says. The What’s Next Tool takes into account the current situation and what’s likely to happen next and options to take steps. Canfield cites the example of Harley-Davidson, which had sales fall 30 percent in three years. The research showed there was a sales curve of people in their 40s and 50s who were now getting into their 60s: aging out as buyers of motorcycles.
“It’s a great example of needing to understand that if you just thought it was a sales problem, you might throw sales and marketing at it, but no amount of sales and marketing will get a 65-year-old to buy a Harley.” The company took another look and realized female riders were under-represented, in part because they weren’t taught to ride growing up the way boys were. “So they did training programs at dealerships with women-only rides to let them feel the cameraderie that others have felt in Harley circles. Also, Hispanic buyers, particularly in the American Southwest, were under-represented, so they positioned this as a way to own an American icon. And the last is what they call urban buyers — I think they mean hipsters — but people who are in a densely populated metropolitan area. Harley is pitching it as a way to get around crowded streets easier, easy to park and low use of resources.”
Canfield wondered, as anyone would, how Harleys could be easy to navigate in a city, but then he saw that the company had acquired part of Alta Motors, a company that makes electric dirt bikes. The collaboration is expected to attract those very urban buyers.
Canfield says dealing with the immense amount of data means whittling it down to what’s truly relevant. “When I talk to CEOs I remind them what it’s like getting a physical. The doctor measures a whole bunch of things, but the report will focus on five or six key elements, like blood pressure, body mass index, blood sugar levels. They’ll tell us in a few metrics about our health and our expectations about our life and how well we live.”
In that same way, the CEO has to know which KPIs — Key Performance Indicators — are the ones to watch. “If we know those, we know a lot about the business,” Canfield says. “If something’s off, make the specific change needed to get that back on track.”
And yet, even if a change is decided on, there are still potential obstacles. Canfield did rigorous research on which company case studies he would include in the book. He examined about two dozen and says, “Even in the ones I didn’t include, there was an ongoing and robust way of feeding information back to the organization so that they could use it.” He points out that if a patient gets a printout from the doctor and does nothing about it, then why bother? “Too often we track things, but there’s not a mechanism built in to say, ‘Therefore here’s what we do.’” And a big part of that is reviewing the data frequently with an eye to change. He likens it to someone getting on the scale every day as opposed to weekly or monthly. The frequent weigher is more likely to take action.
Strategies typically are things that you want to accomplish over a two- to three-year horizon at a minimum,” Canfield says. It can go longer, even be permanent, he says. And the tactic might be identifying prospects and targeting them.
Best Buy, for example, looked at its data and noticed that while millions of people walk into their stores every year, it’s only four categories that account for 85 percent of sales. And they characterized those categories as four individuals. “They studied them, where they lived, how much money they made, what kind of car they drove, how often did they come to the store, if they had children and if so, how old.”
As an example, one of the profiles was that of “Mary,” a suburban housewife who liked being referred to as a housewife, with kids between 10 and 17. “When she came to the store, she very rarely bought for herself,” Canfield says, “and in fact she usually came in with something either written down or on her phone that said this is what I’m supposed to get. Best Buy figured that the worst thing they could do for Mary, is say, ‘We don’t have that one, but this one’s just as good,’ because she gets home, somebody says, ‘Mom, that’s not what I wanted,’ and now she has to return it.”
Figuring out who buys your product or service and then acting on it is key. “We wanted the book to be something that anyone could use who really wanted to run their piece of the business, or even understand how businesses run better so that they can move up through the organization,” Canfield says. “I was with someone recently who had bought a franchise, and he said: ‘They taught me how to do the business that they’re in, but nobody taught me how to be a CEO.’ That’s a pretty common thing.”