I have been involved with numerous CEOs and Presidents in a variety of capacities from being a personal Executive Coach to sitting on the Board of Directors to just being a consultant on specific leadership and sales projects.

In fact, I have walked in those shoes myself. One thing I have learned for sure is that every decision the CEO makes, every choice they make has a consequence. Sometimes that consequence is direct and recognizable and sometimes it is not and could be considered utilizing a military term as collateral damage. Sometimes the consequence is good and sometimes the consequence is bad.

Most CEOs and Presidents of corporations are dedicated hard working committed individuals who burn the candle at both ends, sometimes to the detriment of the personal life. One of my primary objectives in coaching CEOs is to introduce the concept of balance in their lives.

However, in spite of that round of praise to CEOs, they too have their weak spots. That weak spot is often recognizable in dealing with problem employees that exist within the confines of upper management. This is especially true of privately held businesses and predominant in family run businesses. Why, because compassion for people is viewed as a core value of most private/family run businesses.

Personally I have witnessed a number of circumstances that demonstrate the difficult challenge a CEO faces when addressing different issues that relate to upper management accountability or even family related accountability in the workplace. 

The Case of the Incompetent Charlie

Charlie just happens to be the brother of the CEOs wife. Charlie is less than an average employee and often wears his relationship to the CEO on his sleeve. Other employees feel Charlie gets away with murder, is way over paid and doesn't carry his load expecting other employees to pick up the pieces he may drop along the way. The CEO agonizes over this and makes the choice that doing nothing is the right move so he doesn't upset his entire family relationships with his wife and other relatives.

BUT, Choices Have Consequences. If the CEO took the time to really figure out what the cost of his decision was to the business he would probably be amazed at the negative impact his choice is having on growth, profitability, leadership development and recruitment and retention.

Abe the Autocratic Manager

Nobody really likes Abe but nobody openly challenges him either. Abe is a bully. Twenty years ago Abe saved the CEOs daughter from drowning at a local swimming pool and from that day forward Abe has been a hero in the mind of the CEO. Abe is not incompetent. He typically performs his job in a satisfactory fashion but is very territorial and has little respect for management. Over the years he has learned how to work the CEO and takes advantage of his relationship. At any other company Abe would have been booted out simply based on his attitude and his treatment and disrespect of not only the employees reporting to him but of ownership as well. The CEO's choice in this case is often to stand back and just hope the problem goes away or to keep it from surfacing at the executive level.

BUT, Choices Have Consequences, when a manager at a high level in an organization becomes very territorial and leverages their ability to dominate and control the consequence is often the inability to really determine exactly what their motives are and at what cost to the organization. Remember, culture is the foundation for success in any organization and allowing employees regardless of their rank or tenure to demonstrate this kind of behavior sends the wrong message to all employees. In fact it becomes a cancer that can destroy the kind of culture built on core values that the company wants and preaches about. Employees lose respect for their leaders. How much is that worth?

Sarah, Shelly & Sally the Sisterhood of Shiftiness'

Sarah, Shelly and Sally are sisters of the President and actually have a minority interest in the company. All three have Executive Management titles in the organization due to their family ties. All three do a good job at what they are assigned to do. However, at least one of the sisters (Sally) feels compelled to let it be known that she is an owner and deserves every perk and benefit given to the President.

After all she is an owner. Although Sarah and Shelly are hard workers albeit well overpaid, Sally is the shifty one that has an ego so large she feels Marilyn Monroe was ugly compared to her beauty. She often wears a Tierra to work. To complicate matters further, the President's wife is the CFO of the company. The CEO is disheartened by the sisterhood as all three stick up for one another but doesn't feel compelled to address it. Sally (who has the wife's ear) informally goes around telling all the other managers how they should be doing their job. Since the CEO is now in his mid-sixties and Sally is only forty two she tells people, everyone (saying it is confidential) that she is slated to become the next President of the company.

The President has addressed some of his concerns with Sally and Sally has skillfully disguised her behavior a little better but since no consequence has been administered to Sally the problem simply lays dormant waiting for the right time to reemerge. The President made a choice not to go any further even though he felt he drew a red line in the sand.

BUT, Choices Have Consequences. The question remains. What impact does the situation have on the company?  Does equal pay for equal work really apply? Do owners, relatives, SOB's (Son of Boss) and DOBs (Daughters of Boss) deserve accelerated compensation simply because of their DNA? What impact do these kinds of choices have on the company's core values and culture? Is it worth it?

Sam the Unscrupulous Salesman

Sam is a well-seasoned salesman that has been with the company for seventeen years. He has the largest book of business in the company. Although he holds the title of Sales Manager he functions predominantly as a territory sales person and delegates his sales management responsibilities to his buddy and direct report. Sam knows he is the biggest contributor to the top line of the company and never passes the opportunity to let everyone know it. He is always late for meetings, often ignoring requests from the VP of Sales on reports, religiously pads his expense accounts and often is found out of his territory doing personal business in spite of an itinerary that says he is in front of his customers.

Sam has violated the company's core values on numerous occasions. The VP of Sales is quite fed up and wanted to terminate Sam's employment. The CEO made the choice not to terminate and told the VP of Sales to rein him in a little but not to push it too much for fear of losing a substantial amount of business.

BUT, Choices Have Consequences. What does it say about the future of the organization if we acquiesce and let the "Inmates Run the Asylum"? How can we address any issue with any employee if we demonstrate our inability to hold people accountable? Are we not giving our employees the license to do whatever they want and we just hope that they will do what is right? In this instance I can tell you that the consequence of this CEOs choice will impact the attitude and performance of the entire company.

CEOs are defined by the Choices they make not the Power they Command

CEOs and Presidents often make poor choices because they fear direct conflict. They often convince themselves to stay above the fray and let situations work themselves out.  They earned that right. Make no mistake, every CEO, in fact, every person has the God given right of free choice. BUT, Choices Do Have Consequences and we cannot forget that. Many times as CEO we find that our choices can be controlled by our emotions without consideration of the consequences. We must guard against that because it is those emotionally based choices that get us into trouble.

You can choose to continue to live with the situation and give it lip service but the situation continues to destroy relationships, morale and even culture. The consequence becomes more frustration, anger; resentment on the part of employees, time wasted, profits lost and eventually could evolve into a culture of corruption.

If you make choices based on fear, anger, misguided dedication, hurt, revenge, jealousy, personal family awareness  instead of what is best for the business, your choices will eventually come back to bite you in the BUTT! They will create more future challenge than you can imagine. They also make your emotional psyche more difficult to deal with than ever before.

So Now What; What's the Answer?

It starts with recognizing that you need to set boundaries. Exactly what you are and what you are not willing to tolerate based on the company's core values and what is in the best interest of the company and all of its employees. Let me repeat that – What is in the best interest of the company and the company employees.  This is called putting business needs ahead of personal needs.

View every relationship you have with honesty, integrity and face the reality of your circumstances. Determine the real consequences of your past choices and don't sugar coat them. Look at every area of your business life. You can create a more successful business by making the right choices. You can also put your business on the path of a death spiral with the wrong choices. You can make better choices if you break the chains of personal emotions, outside influence and fear of conflict attached to situations and view them as they really are. It is impossible to avoid the choice-consequence factor. It is a Law of the Universe

So……….. If you remember anything from this article, remember this…………………

Choices Have Consequences

Rick Johnson, expert speaker, wholesale distribution's "Leadership Strategist", founder of CEO Strategist, LLC a firm that helps clients create and maintain competitive advantage. Need a speaker for your next event, E-mail rick@ceostrategist.com.  Don't forget to check out the Lead Wolf Series that can help you put more profit into your business.