July 16, 2014
The Cost Of A CEO Honeymoon

This article is not about a romantic wedding ceremony or a luscious cake or even luxury travel. However, you will notice the similarities between these images and some corporate relationships with the CEO: something called “The CEO Honeymoon.” Take a look around at the next executive team meeting you attend. It is difficult to find an executive team member who is not, on some level, enchanted with his or her CEO.

This admiration is completely understandable. Executives have seen the CEO in action and know a good deal about his personal life. They get excited to see him in a public forum talking about the company they all serve. The CEO Honeymoon is not a love affair but the affinity team members feel for their CEO, especially when they have forged a close relationship. A tight-knit relationship with the CEO gives an executive power within the company.

The relationship between the CEO and the executive team also provides the energy that drives a company forward. When members of the executive team shy away from presenting the complete story about business conditions he or she oversees, the company could sustain serious damage.

It’s like a pop-up fly ball in a baseball game where several players converge to make the catch and they are waving each other off as “they’ve got it.” In many of such situations no one makes the catch as the ball thuds to the ground between them. Much like required expectations to catch the ball, each executive is mandated to fulfill his or her area of accountability to the highest degree of excellence achievable.

When an executive brings up an issue with the CEO in an open forum, there is a good chance he or she has downplayed or ignored the harsh realities of the problem. It happens. There is no doubt the executive believes he or she can handle the matter but the time consumed mitigating the issue could knock off the cadence of the entire executive team by more that a few degrees. Post executive meeting hallway peer discussions are no substitute for direct and full exposure of a critical matter in the company of the CEO and other executive team members, no matter how painful.

Getting executives to tell it straight to the CEO should be a priority of executive team meetings. It’s important to tell members there will be no repercussions or impact on their relationship with the CEO for coming fully forward with critical issue. Even after doing so, executives might remain hesitant to come forward.

Like the “until death us does part” commitment in a marriage, full disclosure from executive team members must be a condition for the CEO Honeymoon. We have all seen a company adjusts its Annual Operating Plan or announce a missed forecast. While we allow for market conditions and unexpected colossal events to occur, there is enough room to consider that the delayed disclosure of critical information to the CEO and executive team is a root cause for these adjustments. These results could well be the direct cost of the CEO Honeymoon.

Should there be an everlasting honeymoon between the CEO and the executive team? Absolutely—as long as the CEO Honeymoon drives the company forward. However, it must be made very clear that it can only exist when the executives are able to take the heat and come forward with the complete details of any issues facing the company. Establishing this understanding is critical to the success of a company and its CEO.

John Runne
John Runne is a seasoned business advisor with over thirty years of experience in advising Fortune 1000 companies and their CEOs on strategy and corporate planning. Mr. Runne’s experience includes engagements with a host of leading public and private companies where he served multiple times as Chairman of Strategic Advisory Councils and boards devising and driving corporate strategic objectives. Mr. Runne has also advised and been actively involved in events leading to acquisitions and sales of companies. He has guided multi-billion organizations on their respective marketing, packaging and positioning of brand products. Mr. Runne has provided strategic counsel at the CEO and board level for both public and private companies through the M&A process.

Other Articles by John Runne:

The Ten Commandments Of Being CEO

Get In Tune With Your Executive Team