Jeroen Smit on Really Listening and Thinking Slow
For decades, business has been ruled by familiar KPIs, e.g., revenue, growth, profit margin and market share. An organization which fails to win and grow turns from hunter to prey. CEO surveys by firms like PwC and Heidrick & Struggles show that leaders increasingly realize that this is no longer true. Nearly half of the thousands of CEOs surveyed believe they will not survive the next decade with the current way of conducting business. From the rapidly growing gap between rich and poor to climate change and the impact of artificial intelligence: failing to address these issues will cost them their license to operate in the foreseeable future.
In late 2021, a worldwide survey of 972 CEOs by executive search firm Egon Zehnder found that more than three-quarters of the CEOs interviewed, with remarkable self-insight, believe they will need to work on themselves to be ready to lead the radical transformation needed. In answer to what they perceive as the greatest obstacle to this growth, nearly half responded with surprising honesty, ‘I cannot listen.’
This is the nearly inevitable result when leading a company for several successful years. Surrounded by mini-me's, listening ceases. To believe in your own truth can create a sense of control and invulnerability. But it also ensures that the other, the new, is not given space.
In Thinking Fast and Slow, Daniel Kahneman contrasts the fast, intuitive day-in-day-out making of countless decisions and managing processes with the deliberate, thoughtful approach of authentic leadership. Intuitive, automatic thinking based on assumptions and old knowledge should make way to slow thinking, creating space for new insights, thoughts, perspectives and a calmness which allows for really looking ahead and envisioning future possibilities.
The average CEO can hardly imagine this. To stay abreast of the here and now, days are packed with countless decisions that demand full attention. Even during a sporadic ‘break-away’ day, cost control and quarterly results demand the attention.
The search for criteria suited to the new economy, such as real prices, green energy, circular economy, transparent chains and inclusive entrepreneurship, requires distance from daily operations. To ensure deep and thorough thinking about the organization's right to exist in 2035, it might be wise to make this slow thinking the main responsibility of the Supervisory Board.
Through continuously aligning the agendas of the board and supervisory board, these new rules of the game gradually grow in importance and can eventually replace the old ones. Moments of pause at the beginning of board meetings can be useful. Five minutes of breathing, to take distance from the issues of the day and connect in silence. This all sounds inconceivable for a board meeting ruled by logic and numbers, but according to Saskia Egas Reparaz, the successful CEO of Hema, this has proved to be a highly effective exercise.
Jeroen Smit is an investigative journalist and author. This column is an updated version of one he delivered during the Discomfort in the Boardroom sessions, where directors and supervisory directors, academics and educators co-create their way toward a ‘humane’ governance practice. Discomfort in the Boardroom has been succeeded by the Enhanced Governance project and takes place at Nyenrode Business University. Published in Management Scope 06 2024.