July 1, 2014 by Gene Jones

Recently, I attended a luncheon sponsored by the CEO Club of New York. This lively group of Chief Executive Officers convenes each month to compare notes, discuss pressing business issues, and network. Their meeting is a delightful event held at the Harvard Club, which includes roundtable discussions, guest speakers, cocktails and lunch. During the time spent amongst fellow CEO’s, I listened to numerous concerns and challenges faced by men and women in leadership positions. It became clear that all CEO’s go through similar phases of self-questioning and self-evaluation, demonstrating that CEO life can be exasperating as well as euphoric.
Corporate coach extraordinaire Brian Souza was the guest speaker after lunch was served.
In sorting through his analysis of management styles, Brian divided them into four distinct categories: The Nice Guy, the Do It All, the Micro Manager, and the Coach.
Creating a graph with Productivity on one axis, and Rapport on the other, Brian expertly explained how the first three of these styles always run into serious problems and inhibit employee productivity, while a Coach style of management boosts employee performance and greatly benefits a company. When the CEO and upper management adopt a coaching style, it empowers employees to reach their potential while also maximizing rapport with management. This constructive state filters down through all levels of the company if properly implemented.
Here is Brian Souza’s breakdown of the four different management styles as I understood it:
In Nice Guy mode, management is overly concerned with rapport and tends to overlook important matters relating to productivity and performance.
In Do It All mode, managers show distrust for those under them by taking over key tasks and not allowing employees the satisfaction of completing jobs/projects they may have started. This creates very bad social dynamics in a company and leads to poor rapport between management and employees. Such a style is particularly destructive in larger companies.
Micro Management has similar negative effects on employee rapport as Do It All, but instead of distrust, employees suffer from annoyance and irritation. It is difficult to discern whether it is worse having someone constantly hovering over your shoulder, or having them repeatedly rip the work out of your hands.
A Coach method of management enriches rapport while teaching employees do their jobs better. In its optimal state, the coaching style of management benefits all parties involved while leading to greater corporate profits.
My contribution to this discussion is what I call ‘The Hat Theory of Managing People and Business’. Wise delegation of authority and responsibility is the key. Effective delegation facilitates the creation of the healthy corporate culture necessary for the success of any company. My personal metaphor for how this is accomplished is ‘The Hat Theory’.
In small businesses, each CEO must wear many hats since there are few, if any other employees. There is little delegation of authority in this case, except in the hiring of various outside contractors who can temporarily be given ‘hats’ to wear when needed. Often operating in a vacuum, the CEO of a small business must be clear on all hats needed in order to limit eventual burnout caused by trying to do too much. Clarifying such a hat situation helps to prioritize the use of one’s time and energy.
CEO’s with few or no employees can benefit from the exercise of autobrainstorming, a process that allows an executive to establish a vibrant boardroom in his/her own mind. The process of autobrainstorming provides a system for lone individuals to see all sides of even the most complex situations, as if consulting with a number of colleagues. This system employs the same process used in team brainstorming sessions, except the autobrainstormer must administer all aspects of brainstorming technique in the absence of other voices. Writing down each challenge and then opening one’s mind to a variety of possibilities provides the necessary input to be considered and processed. This initial procedure must be done without judgment. Autobrainstorming requires some training, but can easily be mastered by any CEO open to flexible multi-dimensional thinking. The ability to create such thought patterns, known as asymmetric thinking, is a most beneficial skill.
In large companies, the Hat Theory is much different. An effective large company CEO must know how to distribute the hats in a manner that maximizes employee performance and corporate profits. This type of CEO must also keep track of the hats, and know when it is time to shift their possession. Every corporate culture is dependent on the sagacious distribution of hats. A good CEO also will keep a couple of hats in his own locked closet, including the oversized hat of ultimate responsibility. Along with each hat distributed, the CEO conveys power, accountability, resources, reward and recognition. When all hats have been properly distributed, companies function more efficiently and have a much better chance to succeed.
Mid sized companies often present the most difficult dilemmas regarding Hat Theory, as limited resources frequently collide with oversized needs and responsibilities. Chains of command are often understaffed, leaving the manager wearing one small hat in desperate need of help he cannot find. Without stretching this metaphor beyond its usefulness, let it be said that giving a manager a hat to wear does not guarantee successful delegation of responsibility. Each hat carries with it a complex array of issues. That is the key to Hat Theory as well as management: Knowing what to delegate, and how to properly support that delegation of authority.
Too often, employees are given positions of authority without being given the resources to accomplish stated goals. This is just as serious a management problem as the employee who is given an assignment without being given the authority to carry it out. CEO’s in companies of all sizes share the common challenge of making the correct call on who to empower, how much power to delegate, and how much support to give in each business situation. This high wire act, onto which I have cutely bestowed the shape of a hat, is only part of a CEO’s total job that inevitably includes major responsibilities such as formulating corporate vision and maintaining functional integration of all business operations.
This is why there is great camaraderie among CEO’s -they all face similar issues that often seem overwhelming. Gathering together for a monthly lunch is an excellent way for high level executives to share experiences, learn some new approaches, and compare hat collections. It is refreshing to be in the company of so many motivated men and women as they openly discuss the endless search to achieve maximum potential in both business and personal arenas.
Such a gathering highlights the unique business perspective of the CEO position, and the undeniable fact that as a collective group, CEO’s are the drivers of our contemporary culture. Regardless of the scale of their company, every CEO has the opportunity to sculpt a company that can potentially impact society, which is the ultimate challenge and reward of running a business enterprise.