How to know if your CEO is under too much stress

Look both ways: Strengths can turn to weaknesses and derail careers Sylvia Liber

For electricity broker EnergyWatch co-owner and chief executive Ben Polis, derailment came swiftly.

On April 5, the Herald Sun exposed him as the author of a number of racially and sexually offensive Facebook updates. On June 22, his business EnergyWatch was placed into liquidation.

The update, “Asian girls add no value to society apart from insurance premiums cause they can’t drive”, was bad enough. And “56 people submitted their details on xmas day at EnergyWatch . . . Just looked at the names, it was all Muslims and Jews! Xmas haters!” was equally reprehensible.

Polis never expected these comments to be splashed across papers nationally. But their publication caused energy giants Momentum Energy and AGL Energy to walk away from their partnership with EnergyWatch. TRUenergy agreed to stay on, under condition that Polis had nothing more to do with EnergyWatch and was removed from its payroll.

“Every manager has strengths but it’s the maintenance of these strengths that will make your career or derail your career,” executive coach and consultant Peter Berry says.

A group manager of leadership assessment and consulting for the recruitment company Talent2, Matt Bristow, believes the Polis example is case of a phenomenal strength turning into an executive’s ultimate weakness.

“You tend to see in these overly gregarious and outgoing types [when they are] under pressure they become exhibitionist, overconfident and divert to classic attention seeking behaviour . . . That was obvious at EnergyWatch,” Bistow says.

Berry explains that qualities such as boldness, diligence, imagination and an ability to get excited easily are all viewed as ideal attributes for someone in the top job. But under extreme circumstances or stress, these attributes have the potential to cause some serious damage. This is widely known as an executive’s dark side.

Berry works with Lend Lease, McDonalds and CB Richard Ellis. He uses a psychometric test called the Hogan Development Survey to identify strengths in top executives and to ensure that this dark side is kept in check.

Berry says that being excitable, for example, is often identified as a strength because it means an individual has passion, enthusiasm and high adrenaline levels.

But it can mean executives express anger and mood swings when things don’t work out as they would like. “Their emotions run way ahead of them.”

Boldness is another desirable quality for leaders but it, too, can manifest as a negative force.

“Boldness means that someone is being confident and assertive but when they cross the line, they can become intimidating, rude and aggressive,” he says. “The assertiveness becomes aggression.”

Bristow describes independence as a “classic derailer”.

“The extreme form becomes isolation,” he says. “Under pressure they will regress back into themselves and not seek other people’s advice . . . they shut down and they become poor communicators.

“We’ve seen it all before, in times of crisis people ask the question, ‘Where’s my CEO gone?’”

The managing director of Korn/Ferry and former head of the Business Council of Australia, Katie Lahey, knows first hand what its like to deal with chief executive derailment.

As a director of the retailer David Jones, she was responsible for managing the fallout after the high-profile derailment of the department store’s former chief executive, Mark McInnes.

McInnes was forced to stand down when a former employee accused him of sexual misconduct and harassment in the workplace.

The $37 million claim for damages accompanying the lawsuit made the issue a national talking point.

Lahey says good succession planning put David Jones in a “fortunate position” to deal with the crisis.

“We had been doing succession planning . . . we knew who was in our top team and their strengths and weaknesses, so Mark McInnes exited one week and we were able to put someone in the role a week later.”

In her role at Korn Ferry, Lahey is now responsible for filling positions like the one McInnes held.

Lahey and Bristow both say that continuous coaching and mentoring, from an internal and an external source is critical.

Bristow mentors a south-east Asian based chief executive who is at risk of “isolation based derailment”. Under intense pressure, the executive stops communicating with the team, choosing to keep his frustration to himself. As a result, he has had outbursts that have upset his team.

Bristow’s coaching involves “going through what’s going on in his end head that leads up to a frustration”.

Together, the pair have identified a series of red flags, including a tight chest, a spinning head and a churning stomach, that indicate an outburst is on the cards.

“We’re now working on a trigger point to catch it,” Bristow says. “It might be breathing, or a [mantra] . . . If he recognises he’s getting frustrated, he’ll say a mantra to bring himself down and to pause.”

Bristow advises that prevention is infinitely preferable to the cure. “Our view is that you just don’t tolerate behaviour that goes against the fabric of the organisation . . . don’t take the wait and see approach, you have to act and act swiftly.”

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