What New CEOs Get Wrong About the Job

Alison Beard opens by asking Nitin Nohria why executives’ expectations collide with the reality of the CEO role, especially when they have already run complex businesses or functions. Nohria’s first answer is counterintuitive: a person usually becomes CEO because they were excellent at running something, but as CEO they can no longer run the company themselves. Their job is to create the conditions in which senior leaders—people doing the kind of work the CEO used to do—can run the company well. If the CEO intervenes in everything, senior executives feel disempowered and begin checking every decision with the boss. Because the CEO’s actions carry a “loud megaphone,” the entire organization starts waiting for approval, slowing decisions “to a grind.” The CEO must instead delegate while maintaining enough clarity and oversight to applaud the team’s work and hold it accountable. Nohria adds that CEOs are unprepared for how broadly the spotlight falls. A CEO’s family may be treated differently by friends, while employees, outsiders, investors, and analysts scrutinize every statement for clues. He says some investors even hire former CIA agents to analyze CEOs’ quarterly-call language and vocal inflection for signs that they are telling the truth. The best CEOs therefore communicate intentionally: they develop clear talking points, repeat the strategy consistently, and still use fresh examples so they sound authentic rather than mechanical.

Nohria says new CEOs initially assume their access to information will expand—and technically, it does. They can ask anyone almost anything and receive a rapid report. But the information is filtered because every person reporting upward has an agenda, even if that agenda is simply avoiding trouble. A manager may frame a problem in a way that makes their own performance look better, or delay bad news while trying to fix it so they can later report, “I worked it out.” He uses a colleague’s metaphor from the cereal business: information reaches the CEO as “cornflakes” but arrives on the desk as “frosted cornflakes.” In other words, the organization sugarcoats reality. Beard asks how CEOs can get the plain version. Nohria recommends going farther down the hierarchy, speaking with frontline employees and customers, and deliberately escaping the bubble of direct reports and advisers. The irony, he says, is that time studies show frontline workers and customers often receive the least time on a CEO’s calendar, even though they are most likely to provide unfiltered information. Trusted long-term confidants can also serve as truth-tellers because they are less concerned with promotions or personal agendas. Maintaining those contacts is a discipline, not something that happens automatically once a CEO becomes busy.

Nohria describes a CEO’s board as the real boss, but a very different kind of boss from the managers the executive handled while rising through the organization. A CEO may be skilled at managing one boss, or perhaps two through a dotted-line relationship; the board is typically a group of 10 to 12 people. Each member has an equal vote and a point of view, but board members usually express concerns politely and indirectly. Board members also engage with the company only every two or three months, so they know less about daily operations than a former boss might. Yet they retain the responsibility to hire and fire the CEO. Nohria advises CEOs to know each director individually rather than relying only on formal board meetings, and to draw out quieter members. The loudest director is not necessarily the most influential. In Nohria’s workshops, CEOs who are fired are consistently surprised. He says they mistook politeness for support and failed to privately ask directors what they really thought. Direct conversations, especially with members who do not express every concern in meetings, could reveal problems before they become a dismissal. He adds that most new CEOs learn this role by doing it; although they are initially surprised, most develop at least a working understanding by years two or three.

Nohria identifies several warning signs that a CEO is on the wrong track. By the second year, the CEO should be able to explain crisply what the company is trying to accomplish. Nohria has interviewed five people selected from a company’s top 100 and found that if they cannot reproduce the CEO’s agenda with high fidelity, the CEO has probably failed to communicate it. Another warning sign is dismissing analysts by saying they do not understand the company, especially when analyst reports repeatedly identify serious problems. Boards may allow some poor performance, but four or five failed quarters can put a CEO on “thin ice.” When observing a new CEO, Nohria looks most for humility. The leader must project confidence, but also remain open-minded, keep learning, and recognize that the job requires continual growth. For aspiring CEOs, a consistent record of delivering results is necessary but not sufficient. The strongest candidates have usually handled something “hairy”: turning around a failing region or business, rapidly realizing the potential of a new venture, or taking a risky assignment that others avoided. Nohria’s advice is to excel at the current job rather than focus too far ahead. Candidates need an exceptional track record, and risk-taking assignments can show that they can create results in both troubled and promising situations.

Asked how CEOs should balance priorities, Nohria says they need two agendas: the company’s broad agenda and their own agenda for the particular issues requiring personal attention in the current quarter or year. He recommends writing down that personal agenda at the beginning of every quarter and reviewing the calendar at the end. If at least half of the CEO’s time was not spent on those priorities, the CEO is not using their most constrained resource well. Money and people can be added or changed; the CEO’s own time cannot. The second priority is assembling an exceptional, aligned senior team. A weak executive creates a distraction: the CEO watches that person closely, while the executive feels watched and becomes insecure. Nohria says he has rarely seen a CEO’s doubts about a senior leader disappear on their own. CEOs should therefore evaluate the inherited team almost through zero-based budgeting: if they were assembling a team from scratch for the current agenda, whom would they choose? Perhaps eight of ten people belong; perhaps eight of ten need to change. The decision should be agenda-driven, not personality-driven. A team that got the company to its current position may not be the team capable of reaching the next one. The most dangerous behavior is postponing changes the CEO already knows must eventually be made.

Nohria distinguishes between motivating a small team directly and motivating a whole organization that the CEO cannot visit every day. His colleague Frances Frei frames the test as: “How do people feel when you’re not in the room?” The CEO is in very few rooms all the time, so organizational energy depends on what employees carry with them when the CEO is absent. Trust is the foundation. Employees need to believe the CEO makes sound decisions, speaks authentically, and lives by the values the company publicly claims. They also watch whether people who violate those values are denied promotions or otherwise face consequences. Everyday evidence that the CEO’s actions match the strategy and values tells employees what to do and how to behave, which Nohria calls deeply motivating. Outsiders face even more scrutiny because employees do not know them. Nohria says early symbolic actions can establish trust if the new CEO respects valuable parts of the existing culture while making necessary changes. He gives the example of Starbucks’s new CEO, formerly from Chipotle: employees reportedly understood that the CEO wanted baristas to talk more with customers. That simple, clear change showed both direction and a reason to believe in the new leader. Nohria says outsiders can sometimes gain trust within six months rather than needing years.

After nearly three decades of workshops for new CEOs, Nohria says about 80% of the job remains stable: setting an agenda, communicating it, building a senior team, developing strategy, and creating a strong culture. The other 20% consists of responding to the external environment. Six years earlier, CEOs were wrestling with Black Lives Matter and pressure to take public positions on social issues; now geopolitics, tariffs, war, inflation, and AI dominate their attention. Earlier waves included cloud computing and the internet. Nohria says CEOs are rarely truly blindsided by these developments. Their bigger difficulty is deciding how a new reality should affect their particular company and how to create value from it. He cites his colleague Mike’s definition of strategy: it is as much deciding what not to do as deciding what to do. A CEO confronting AI, for example, should identify the two applications most aligned with the company rather than attempt everything, and should have the courage to say the organization will not compete on the other fronts. He closes with a warning about the personal cost of the job. Someone invited to become CEO should ask whether they are ready for substantial sacrifice: the role can consume ten years, most CEOs travel about a third of the time, and even a conscientious leader will miss some important family events.