The Dangers of Being a Know-It-All GM

In coaching and counseling CEOs, we have noted and written about the fact that the need to appear confident, combined with the lack of good feedback available to senior people, can lead to arrogance and egotism. As a new GM encounters situations for which he has no experience and no clear course of action (which is what new GMs mostly encounter), arrogance becomes a shield to ward off the fear that he’s not up to the task. To help guard against this attitude, be aware of the following common dangers in this passage:

• Disdain for the functions. People tend to go into the GM job with biases against functions in which they’ve never worked. They refer to financial people as bean counters, or they talk about how HR professionals don’t understand business issues, or they believe that marketing people are all sizzle and no steak. As a result, they don’t learn to use all the functions in a way that will make them—and their business—successful. They become over-reliant on the functions with which they are comfortable or once worked in, even if those functions should not be driving the business. Because they’re so certain that their function is critical for business success, they never can view other functions objectively.

• Myopic focus on performance and results. Obviously, performance and business results are important, and it’s understandable that when you are given P&L responsibility for the first time, you are naturally eager to deliver profits and avoid losses. The financial scorecard for a business, unlike a functional budget or objectives, is displayed for everyone to see, and it makes GMs acutely and consistently aware of their results. In large corporations, it is not unusual for divisional presidents or GMs to eye each other’s results and engage in overt competition about who is more successful and therefore more deserving of promotion.

  But GMs must also learn that hard results need to be balanced with “softer” responsibilities such as developing people and shaping a culture. In the long run, these responsibilities affect the bottom line as much as, if not more than, creating a strategy and driving toward objectives. Business heads must recognize that they can only sustain strong performance and results by juggling multiple priorities. In certain instances, they need to make tradeoffs, sacrificing some of their time and the business’s money to communicate with people or to develop the next generation of leadership. They may never have had to make these tradeoffs before. Now in their new role, they have to learn how to make them in real time.

• Failure to challenge the business model. This is a particularly challenging issue for business heads who take over from a strong leader to whom they owe their promotion. They feel beholden to carry on the strategy and traditions of their mentor or former boss. It feels disloyal to deviate significantly from the norms that have been established. Yet challenging the business model is something all GMs must do regularly. This is a passage in which leaders have to establish their own point of view, to create their own theory of the case. In the past, they may have simply adopted the point of view of their boss, but this is unacceptable behavior for a GM.

Learning to question an inherited strategy or system is tremendously difficult for some new business heads, especially if surrounded by alumni who helped the previous GM create that strategy or devise the systems. But it’s absolutely essential at this leadership level and for all levels above this one.