WHEN YOU NEED TO LEAD WITH INSPIRATION, NOT FEAR

Dear Founder,

Communication is so important. But it’s not just what you say and how often you say it. It’s also—perhaps even more so—about how you listen. Adhering to this practice is especially important when you’re the CEO. It has massive implications for the culture you want for your company. Do you want to run your company based on fear and power, or based on inspiration? Stephen Covey famously advised, “Seek first to understand, then to be understood.” A more folksy adage is that God gave us two ears and one mouth for a reason.

Listening is so important because not doing so comes off as defensive, and worse, it’s a gating factor to success. I recently saw the danger of not following Covey’s advice during a challenging communication with the CEO of one of our portfolio companies that’s en route to being a breakout success. Although we’ve poured tons of energy and resources into the company’s success, it has hit some self-inflicted turbulence. Though the turbulence isn’t catastrophic, the company needs to course correct fast to live up to its full potential.

In a discussion with the CEO about the situation, it was my intent to gently make suggestions without telling him exactly what to do. I tried to articulate that I had spent time thinking about his problem, had seen a similar situation before, and wanted to help. Unfortunately, the CEO heard my counsel as criticism, which led to a debate with high emotions, rather than a collegial dialogue where everyone’s views were heard.

Perhaps I was not overt enough, but I tried to be gentle in offering advice because I knew the CEO can sometimes get his hackles up when he perceives he is being challenged. This attitude is very out of character with how he usually shows up, in what I call good CEO behavior. This issue has unleashed a distressing problem for me: I’ve found myself not wanting to speak up or raise an issue because I feared it could lead to a debate or an argument. Having this concern has led me to hold back at times, especially with some smaller issues, but when I feel strongly about something I bring it up. As an investor, I have an obligation to call out any serious issue, and I need to do so in a way that is productive.

When a CEO frequently reacts to information or perspectives defensively, it sets off alarm bells for shareholders and board directors. If this is how the CEO reacts to people to whom they are accountable, how are they interacting with their employees? Do the employees feel safe in surfacing their concerns and ideas? By now, I’ve been through many battles, and I can handle a little turbulence. However, frankly, I find it to be tiring, no fun, and generally unnecessary. What concerns me WAY more than how a CEO hears my feedback, is whether they are actively listening to their own employees, customers, and shareholders.

I can’t emphasize enough the power of active listening. Sometimes CEOs miss cues from advisers or employees because they’re not listening carefully enough, they’re not paying attention to nonverbal cues, or they’re distracted by other things. That’s not acceptable. Active listening is a skill all CEOs have to master in order to succeed with their board, their employees, their customers, and their community. A few ways to hone your listening skills:

• Be open to others’ thoughts. Realize that everyone is entitled to their opinions and perceptions, even if you disagree with them.

• Make sure you follow the Covey advice of seeking first to understand. Keep asking questions until you have drained all the points the person hoped to make. If someone looks uncomfortable or attempts to change the subject, there is likely more on their mind. Make it safe for them to share their thoughts.

• Ask clarifying questions. Don’t say judgmental things like, “You’re wrong.” Say, instead, “That’s an interesting perspective, I need to think about it.”

• Don’t act defensively or disregard what you’ve been told. You can share your perspective, but at the end you should repeat what you’ve heard and have alignment around next steps to correct the situation.

• Lead with inspiration, not fear. If every discussion is a battle, people have to decide how much energy they want to expend and where, and you won’t get engagement unless there’s something really wrong. Replace a command-and- control culture with one that is inspiration-based and gives everyone a chance to buy in and make meaningful contributions. The very best companies are led by inspiration—not by fear or power. Problems will happen at all companies, but people do their best work when their company’s culture is based on getting the best from everyone, being open, celebrating problems and fixing them fast, and making everyone feel safe to help the company achieve its destiny.

Taking a step back, we all understand that as an entrepreneur you are a risk-taker who often has a contrarian point of view. As such, you are questioned constantly and need to have a chip on your shoulder in order to execute the vision. That’s a strength. However, it becomes a weakness when you become so committed to your belief that you don’t listen to what’s not working and you aren’t open to iterating and modifying your vision.

All the best,

Maynard