Succeeding in the c suite

Egon Zehnder International Program for Advanced Leadership and Management Succeeding in the C-Suite January 27, 2011 08:30am – 12:30pm Dr. Mark Byford Johan H. Brand Madinah, KSAThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011

Introduction Speakers for this morning Mark Byford Consultant and Partner with Egon Zehnder International London Office MBA, INSEAD. Formerly Manager, The Boston Consulting Group, London; MA, D.Phil., History, Oxford University, Junior Fellow, New College, Oxford. United Kingdom Johan H. Brand Consultant and Partner with Egon Zehnder International Dubai Office MA, Business Economics and Formerly several commercial management positions within Procter & Gamble, Rotterdam/Brussels and Pepsi-Cola MA, Business Law/Common Law, International, Europe. Erasmus University Rotterdam, The Netherlands.This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 1

About Egon Zehnder International Who we are EZI: Size, Reach, Scope The world’s leading privately held retained executive search firm - founded in 1964 3 core practice areas: Executive and Senior-level Search Leadership Strategy Services, including Management Appraisals and Talent Management Non-Executive Director Board Appointments & Corporate Governance Advisory Sector practice groups focus on in-depth experience and coordinated efforts in Financial Services, Technology, Industrial, Consumer, Life Sciences, etc. Consultants with Deep Industry Expertise 385+ Consultants with post-graduate degrees (MBA’s, PhD’s, LLM, etc.) from top academic institutions 10-15 years prior business experience in line management, finance or consulting prior to joining our firm Highly Collaborative "Boutique" Structure Our firm is privately held (owned equally and entirely by partners) Operates as a single global entity, the firm has only one profit center There are no economic barriers between offices or consultants Strong Track Record of Speed, Quality, Results and Business Impact 3-5 qualified and interested candidates presented within 35 - 45 days Long-term client relationships with significant percentage (80%+) of repeat businessThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 2

Egon Zehnder International – strong global presence The Americas 1 Atlanta 11 Miami 26 2 Bogotá 12 Montréal 31 3 Boston 13 New York 20 36 23 49 4 Buenos Aires 14 Palo Alto 24 28 5 Calgary 15 Rio de Janeiro 37 29 44 43 46 42 48 25 6 Chicago 16 San Francisco 30 7 Dallas 17 Santiago 50 40 38 30 8 Houston 18 São Paulo 45 9 Los Angeles 19 Toronto 22 39 10 Mexico City 32 35 41 Europe, Middle East, Africa 20 Amsterdam 36 London 5 12 19 21 Athens 37 Luxembourg 3 6 13 22 Barcelona 38 Lyon 16 14 21 33 51 23 Berlin 39 Madrid 58 62 9 7 24 Brussels 40 Milan 1 47 8 59 25 Budapest 41 Moscow 11 57 27 26 Copenhagen 42 Munich 52 10 34 27 Dubai 43 Paris 56 63 28 Dusseldorf 44 Prague 29 Frankfurt 45 Rome 2 54 30 Geneva 46 Stuttgart 60 31 Hamburg 47 Tel Aviv 53 32 Helsinki 48 Vienna 33 Istanbul 49 Warsaw 34 Jeddah 50 Zurich 35 Lisbon 15 18 Asia Pacific 17 61 4 51 Beijing 57 New Delhi 55 52 Hong Kong 58 Seoul 53 Jakarta 59 Shanghai 54 Kuala Lumpur 60 Singapore ~ 385 Consultants are located in all major 55 Melbourne 56 Mumbai 61 62 Sydney Tokyo markets in 37 countries worldwide. 63 BangaloreThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 3

Service portfolio of Egon Zehnder International: Broadening out of core Executive Search practice Executive Search Management Appraisal Attracting leaders; Benchmarking anticipating top people against tomorrow‘s needs "best-in-class" Egon Zehnder International Turning the board Developing & into a strategic retaining your asset best people Board Consulting Talent ManagementThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 4

Service, Sector and Functional Practices of EZI Shared knowledge and global co-operation in service, sector and functional practices Service Practices Sector Practices Functional Practices • Executive Search • Consumer • Marketing Officers • Board Consulting • Financial Services • Financial Officers • Leadership Strategy • Industry • Human Resources Services, including • Life Sciences • Legal Officers Management Appraisal • Private Capital • CIO and IT/Business • CEO Succession • Services Processes • Family Companies • Technology & Communications • Governmental and Non-Profit • Sports • SustainabilityThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 5

Program for Advanced Leadership and Management Succeeding in the C-Suite Dr. Mark Byford Johan H. BrandThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 6

Succeeding in the C-Suite •Objective of this module is to increase awareness of what it takes to succeed in the C-Suite • What it takes to get to this aspirational level • What it takes to be successful in the C-Suite • Focus is on successful behaviours, building both your self awareness and your awareness of those around you • ‘You and yourself’ • ‘You and others’This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 7

Agenda You & Yourself • The Critical Challenges: your perspectives • Drivers of C-Suite Success • The role of Great People Decisions You & Others • Influencing others • The Keys to Building Effective Teams • How to Prepare for Your New RoleThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 8

49 of you responded to our PALM 2 Survey Dear PALM participant, We are looking forward to meeting you in January as part of the PALM 2 program for our module Succeeding to the C-Suite. As partners in Egon Zehnder International, we often deal with executives considering the challenge of moving into the C-suite, or reflecting on their progress in a C-level role. This will be the subject of our work with you during the program. As part of our preparation, and to make sure that we focus on the topics that are of most interest to you, we have compiled a very brief questionnaire which would like you to complete as soon as possible. Your responses will be treated in complete confidence, and will only be shared in anonymous, aggregated form. The questionnaire should not take more than ten minutes at the most to complete. We would be grateful if you could complete the following questionnaire no later than 7th January. Once you have completed it, you can print it or save it on your desktop. If you bring a copy of your completed questionnaire to the program, then you can compare your views with the aggregated views of all participants in the program. We are looking forward to your participation and to meeting you in MILE next month. With best regards, Johan Brand (Dubai) and Mark Byford (London)This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 10

Survey respondents widely spread across industries… Q. Which industry sector are you in currently? All Other Responses Business Services Sector Education Public sector/ Government Manufacturing/ Processing Energy/Power Generation Consumer goods IT/Telecom Retail/Wholesale Financial Sector ConstructionThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 11

… and almost half already in the C-Suite… Q. How long have you been in the C-Suite already? Not sure if I will get there More than 5 years Should get there in the next 3 to 5 years Between 3 and 5 years For 2 years or less Should get there in the Will be appointed within a next 1 to 2 years yearThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 12

…some feel well-equipped for the business challenges in the C-Suite, but most feel there is more to learn Q. To what extent do you think you already have all the skills to deal with the C-Suite’s important business challenges? Better than needed At the right level Some room for improvement Major room for improvement 0% 10% 20% 30% 40% 50% 60%This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 13

… nevertheless, a high 85% feels confident to very confident that they will be successful in the C-Suite! Q. To what extent do you feel confident that you will be successful in the C- suite? Very confident Confident Less confident Not confident 0% 10% 20% 30% 40% 50% 60% 70%This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 14

You see almost all the core management skills as very important Q. How important do you think are each of these skills for you in the C-suite in your specific business/organization? 160 140 120 100 80 60 40 20 0 Very important Important Neither important nor Unimportant Very unimportant unimportant Leading people Leading strategy Managing change Delivering financial results Delivering operational results Managing external stake holders Managing peersThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 15

But People, Strategy and Change were ranked by you overall as the most critical skills to master… Q. When thinking of the most important challenges of being in the C-Suite in your specific business/organization, which of the following skills do you think are most critical for your success? Please rank (1 = most important) Leading people Leading strategy 1 Managing change 2 3 Delivering financial results 4 5 Delivering operational results 6 7 Managing external stake holders Managing peers 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 16

… these are also the areas where you expect to experience difficulty over the next two years Q. How would you rate the level of difficulty that you expect to experience with these skills in your specific business/organization over the next two years? Managing change Leading people Leading strategy Delivering financial results Managing external stake holders Delivering operational results Managing peers 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% A lot of difficulty Some difficulty Neutral No difficulty Dont knowThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 17

Delivery is the top priority for more experienced executives, while potentials are more focused on managing others Delivering financial results Delivering operational results 1 In C-Suite already Leading strategy 2 3 years and over – Managing peers 3 top 3 ranking Managing external stake holders Leading people Managing change 0% 20% 40% 60% 80% 100% Delivering financial results Delivering operational results Leading strategy 1 Expect to be in C-Suite Managing peers 2 within 5 years – 3 top 3 ranking Managing external stake holders Leading people Managing change 0% 20% 40% 60% 80% 100%This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 18

Your most important business challenges in the C-suite over the coming 1 to 2 years …process and operational improvement, making most of peers think and work in unity, changing the culture of the organization, managing change, creating profits, how to orchestrate application of available innovations in line with business needs, develop clear and powerful personal and business goals, delivering major projects, keep the growth rate, cost control, attracting top 10% Focus on talent, leading strategy, deliver financial results, managing change, managing leading priorities, deliver operational and financial targets, delivering results, building people, image as indispensable leader for my organization by proposing profitable managing products and services, upgrading leadership and operational skills to keep up change, delivering with the growth of our company, managing change, leading people, managing results change, get growth in sustained market, building new company structure, managing change, geographical expansion, deliver growth targets, leading changes, get financial results, attracting top talent…This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 19

Most important business challenges in the C-suite over the coming 3 to 5 years …provide people and organizational leadership, modify a model strategy to be used widely, set up the business leadership team for the organization, leading strategy, reaching 5 years goals on turnover and bottom line, competition, recruiting sustainable talent, liaise between ‘old school’ and ‘new school’ of C-Suite level across companies, to ensure the strategic planning process moves into operating plans with clearly defined responsibilities, to measure planned goals with the achievements, succeeding to meet the strategy, have the Focus on talent pool and pipe line full of leaders, define investment opportunities, competitive people strategy for sustainable growth, leading strategy, leading people, to implement 5 year leadership, strategy, manage growth and strategy, manage the public in case of IPO, manage change, leading strategy, growing foreign offices, transformation to next level business model, managing people, delivering expansion in different categories/geographies, achieving the strategy goals, leading sustainable strategy, building strong client relations, maintaining loyal customers, increase profitability, growth deliver on financial and operational projections, respond to market change, Saudization, international expansion, achieving targets while facing increasing competition and limited resources, change the mindset of my leadership, financial, talent management…This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 20

Survey summary The 49 respondents are widely spread among industries • And almost half of you are already in the C-Suite You are confident of success • But most of you feel there is still much to learn While you believe all the core management skills are important, you are particularly focused on three of them: • Managing Change, Leading People, and Leading Strategy These are where you see most difficulty for you going forwards, though as leaders gain more experience there is a shift of emphasis • Those already in the C-Suite are more focused on delivering financial/operational results, and less on managing key internal and external stakeholders In the shorter-term, your predominant focus is on delivery and managing change, but longer-term you are more concerned about creating or maintaining a sustainable strategy • And the major potential barriers to success are largely people-relatedThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 21

Any changes of view as a result of your work during the past two weeks? Have your priorities changed as you have progressed through the PALM 2 programme? • If so, how have they altered, and why? Has the program increased your sense of the importance of certain topics? • If so, which ones, and why? “What are your experiences on this matter that you would like to share with your fellow participants in this PALM session?”This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 22

EZI perspective on C-Suite It’s the biggest leap! Major discontinuities from previous levels • Strategy • People Leadership • External stakeholders/owners • “Decision maker of last resort” • Absolute necessity to deliver results (operational and financial) • …This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 24

What we look for in a C-Suite Executive Like an iceberg, what lies under the water has much greater depth than that which you see above the surface. Critical Skills to date Performance and Experiences Competencies the role Readiness for and Identity Potential for the futureThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 25

What we look for in a C-Suite Executive: key elements Performance Readiness Potential Future To Date For Role Trajectory Value Critical Skills and Emotional Creation Experience Fluency Market Intellectual Competencies Perception Fluency Identity Resolve Development Cultural Fit Orientation DriveThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 26

How do we assess readiness for the C-Suite? Step One: Performance to date Performance Understanding your performance to date, what value you To Date have added to the organisation(s) you have worked in, is a critical first step Value Creation Points of consideration: Market • What business impact have you made so far? What value Perception have you added? • How are you perceived in the wider market? • What possibilities could this open up? - Are there limitations due to the past?This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 27

Self awareness starts with understanding how others see you through what you have done Knowing where you stand already • What do those around you rely on you to deliver ? – based on past experience and delivery • What do others see as your “Personal Brand”? Understanding “the other side of the coin” • Everyone has weaknesses that are the consequence of their strengths – Eg, someone who is very driven to deliver as fast as possible, may not be very effective in consulting others’ opinions first • You will be stronger for understanding your “other side” and its impact on how you are perceivedThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 28

Value Creation Value creation “gets you in the game” Company Overview: Plectrum Plc - (historical 2006 – 2010) ILLUSTRATIVE Name: Francois Lebon Revenues, currency £B 6.7 6.6 6.7 President 6.4 President 5.7 Nationality: International French CEO North America Paul Scott June Striver Susan Arrowsmith Location: UK Education: Ecole Polytechnique Languages: Asian French, English President CFO 2006 2007 2008 2009 2010 Markets President Dick Smith James Kent Europe Career Summary: Francois Lebon Market cap, currency £B 50 1998 – present Plectrum Plc Executive Directors 40 2000 – 2004 President, Major Markets (UK, Germany & Spain) 30 President 20 1999 – 2000 Counsel General Managing Director, Global Supply Global Marketing , Sales Director HR Director Global IT 10 Fred Townsend 1997 – 1999 & Innovation Managing Director, Emerging Markets James Terry Beam Jim 0 Bill Bridges 2007 2008 2009 2010 1992 – 1997 Bluestream Plc 1997 – 1996 Marketing Director Worldwide 1992 – 1994 Managing Director France Share price, currency £ 1988 – 1991 Groupe Affaires, Paris Founding Partner Comments: • After an early career in fmcg and consulting, Lebon enjoyed a very fast trajectory at Bluestream, making the executive board in five years. He was given increasingly complex markets to run, being credited with the ability to focus on and constantly improve revenue, efficiency and Operating profit, currency £B profitability 2.1 2.0 1.9 • He was seen as the number two to CEO John Andrews but left when he realised Andrews was 1.4 1.7 not likely to step down in the near to medium future. • In his last role at Plectrum Lebon was responsible for £3.5B sales, £800m profits and 20,000 staff. During the two years of his tenure there he was able to impact the business significantly, and the share price moved from £6.50 to over £9.00. 2006 2007 2008 2009 2010 Financial Data Source: Capital IQThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 29

Market Perception Your “Personal Brand” • Strengths are the Executive’s “Personal Brand,” their competitive edge that has helped them deliver the most value through their career • Research shows executives should build on strengths rather than solely focus on weaknesses • Many executives need help to articulate their “Personal Brand” and how it can be leveragedThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 30

How do we assess readiness for the C-Suite? Step Two: Readiness for Role Readiness Understanding what is needed in the next role, and how far For Role the skills you have developed equip you to meet those requirements, is the second step Critical Skills and • Analyse what the role requires for success, and create a role Experience specification • Establish which skills, experience, and leadership Competencies competencies are needed for an executive to succeed in the role Identity • Check whether the executive believes the role is aligned with who they are, whether it fits with their values and they are prepared to accept the costs it will impose on them Cultural Fit • Review cultural fit with the new organisationThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 31

Critical Skills and We analyse the specific business challenges Experience you will need to address to be successful? Start with business goals • What are the overall strategic priorities? • What are targets in $, % growth? • “How will the job holder contribute to achieving these goals?” Focus on critical situations • “Can you think of some specific situations that will be critical to success in meeting these priorities?” Work backwards from examples of people already doing some or all of the role effectively • “Do you have anyone who is performing this job effectively? Describe what it is that makes them effective.” • “Is there a competitor who is particularly good at this?”This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 32

Critical Skills and Relevant experience is then identified and Experience assessed against Requested experience role profile for CEO position - Feedback from Board Member discussions Illustrative Board Experience Must have Nice to have Acceptable Proven CEO Executive Board Member Sector Experience Financial Services ? ? Life Industry ? ? Asset Management Business Context Driving Performance improvement Leading a substantial and sustained change programme Leading a growth agenda International Experience Global ? Regional P&L Functional Route Regional General Management Marketing/SalesThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 33

Our world-leading EZI scaled competency Competencies model is used to refine role requirements Egon Zehnder International Core Competencies • Team Leadership • Strategic Orientation • Collaboration & Influencing • Market Knowledge • Change Leadership • Building Organisational Capability Thought People Leadership Leadership Business Leadership • Results Orientation • Commercial Orientation • Customer ImpactThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 34

A unique Role Specification is built by us, based on this analysis The Role Illustrative Future Challenges Main Tasks & Responsibilities Behaviours/Values Technical Skills Experience Required Competency ProfileThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 35

“Identity” refers to how you see the new role Identity fitting with your career aspirations and values What makes the role interesting to you? Why do you want it? What are the important implications for you personally of taking on this role? • Have you appreciated the impact of the time commitments, the level of personal accountability, and the need to work through others How would you describe the values of the organisation, and how far does it fit with your personal values? Identity is not about skills, but about your aspirations and values: self awareness here is keyThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 36

Identity Identity: what good looks like Excited and energised by the possibilities of taking on the role Understands the specific role requirements in terms of personal demands and how life will change Recognizes the job is to grow shareholder value, and this will require different work focus Articulates how leading people at the next level is different from his current role Explicitly lives the values of the organization: knows that his actions will be held to a higher standard than others Prepares for role by seeking understanding from superiors and others who have held similar rolesThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 37

Cultural Fit Diagnosing Cultural Fit: EZI’s model of organisational culture Organizational Leadership Clarity of Direction Clarity • Leadership style • Vision & goals Vision & goals • Communication climate • Roles & responsibilities Roles & responsibilities • Decision-making and values • Performance targets Performance targets Culture Diagnostic dimensions Learning and Renewal Performance Drive • Motivation to deliver Motivation to deliver • Feedback • Pro-activity Pro-activity • Development support • Process orientation Process orientation • Innovation • Attitude to risk Attitude to riskThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 38

We also assess for risks of derailment: Overview Derailment occurs when a manager on the road to success is fired, demoted or given a job below his actual level of achievements • The most frequent cause for derailment is insensitivity to others CEOs are very vulnerable to derailment because of the pressure at the top of the pyramid • The insulation from honest feedback further increases the risk for derailment by preventing CEOs to be aware of the traits that are hurting them and their organizations Dotlich and Cairo list ten characteristics (derailers) associated with CEO failure • Arrogance, melodrama, excessive caution, habitual distrust, aloofness, mischievousness, eccentricity, passive resistance, perfectionism and eagerness to pleaseThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 39

Self-awareness is your key defence The average person has two or three potential derailers, these derailers are the flip side of very useful strengths It’s only when people are unaware of the trait, deny its existence or fail to see its downside that issues arise • E.g., Arrogance is the flip side of self-confidence, crossing the line from self confidence to arrogance would be for instance going from « fighting for what you believe in » to « being unwilling to give up a fight no matter what » The key to avoiding derailment is self-awareness – assessing the candidate’s self-awareness and openness to feedback is thus critical • Shipper and Dillard (2000) found that managers who were about to derail were more likely to recover if they estimated their skills accurately and derailed managers can recover if they are able to honestly evaluate their performance and learn from experience (Kovach 1989)This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 40

How do we assess readiness for the C-Suite? Step Three: Future Potential Potential Understanding your future potential, so that you can grow with the role, and also manage new circumstances as they occur, is the third step: Emotional • Are you energized by empowering others to create a positive Fluency (EQ) impact? Can you inspire commitment, develop champions, and build a self-renewing culture? Intellectual Fluency (IQ) • Can you make sense of complex information, discovering new insights that transform past views or set new directions? Resolve • Do you have the courage to persist to achieve goals of substantial scope and difficulty despite challenges? Development • Do you remain open to new experiences, ideas, knowledge, Orientation and people? Can you identify the new key success factor? Drive • Do you understand what motivates you to succeed?This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 41

Emotional Fluency (EQ) Emotional Fluency: what good looks like Describes success in terms of impact driven by others • Does not require ego-boosting Feels proud of the accomplishments of others and gives them the credit • Excited knowing that he has had on impact on them Feels satisfaction from empowering and encouraging others to take the lead • Gets excited by the possibilities of channelling power into his team • Enjoys influencing people to create change independently Knows how to use power based on situation • Sometimes overtly through formal authority and other times discreetly through influence Sets up successors for even greater success than he hadThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 42

Emotional C-Suite leaders are typically motivated to work Fluency (EQ) through and empower others Links to Personal Humility, a core value in Jim Collins’ “Level Five Leadership” Demonstrates a compelling modesty • Shuns public adulation, never boastful, but showcases the team’s achievements Acts with quiet, calm determination • Motivates others through inspired standards, not principally through charisma Channels ambition into the company, not the self • Sets up successors for even more greatness in the next generation Looks into the mirror, not out of the window, to apportion responsibility for poor results • Never blames other people, external factors or bad luck Source: HBR, The High Performance Organisation, July-August 2005; EZIThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 43

Intellectual Intellectual fluency enables C-suite Fluency (IQ) executives to handle complexity effectively CEOs are dealing with so much complexity, they have to make decisions with relatively small amounts of information • So they need to be intellectually very agile We are looking for two inherent skills • Flexibility: taking the initiative to shift thinking to gather information at all levels • Pattern recognition: making sense of highly complex information In addition to education track record, we focus on the range of someone’s thinking and discussion: • Do they proactively shift their thinking – from technical or operational details to strategy, function to line, and back again – thinking both broadly and deeply? • Can they make sense of complex information, discovering new insights that set new directions?This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 44

Resolve Resolve is a key differentiator of outstanding CEOs Jim Collins describes resolve, which he calls “Professional Will” as a key capability in great CEOs • Demonstrates unwavering resolve to do whatever must be done to produce the best long-term results, no matter how difficult • Is able to take a counter view and hold his line • Sets the standard for building an enduring great company; will settle for nothing less Source: HBR, The High Performance Organisation, July-August 2005; EZIThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 45

Development Development Orientation reflects a continuing Orientation desire to learn and develop, “learning agility” “Analytically agile” managers learn “People agile” managers learn from from study openness to the views of others • Seek out the new, different, and better • Connect/network beyond normal boundaries • See patterns in diverse data • Look for and test out alternatives • Seek guidance from others • Experiment and analyze to learn • Search out people with different ideas on key topics of interest • Open to feedback: reflect on key messages and incorporate findings into their development plansThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 46

Drive What motivates the candidate to succeed? Q. “Your true motivation for being successful in C-Suite?” Self achievement (“Fulfilling your potential”) is the key motivational driver for over 2/3rds of respondents Other motivational drivers that you mentioned are in the areas of: • Power motive • Financial gain / personal financial stability • Leading other to achieve goals • Desire to help others • Being a leading Muslim in my field • Family tradition • StatusThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 47

Self awareness is important! “What are your experiences on this matter that you would like to share with your fellow participants in this PALM session?”This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 48

Egon Zehnder InternationalThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 50

What research shows about career success You need to: • Build good relationships • Deliver hard results • Leave a strong legacy Once you become a manager, you deliver through others Great People Decisions are essential for: • Selecting great people • Assigning the right person to the right job • Developing the right successorsThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 51

Factors for career success Good fortune Genetics Three controllable factors • Development • Career Decisions • People Decisions Most of these factors have different weights at different stages of our lifeThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 52

Great People Decisions and Career Success The ability to make great people decisions is the most powerful contributor to career success The farther along you get in your career, the more important they tend to becomeThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 53

Great People Decisions are one of the few sources of corporate performance Five-year study: the largest content analysis ever undertaken, covering: • 10 years of relevant data • 160 companies • 200 management practices that were thought to influence business success Conclusion: • Only a tiny fraction of these 200 practices make any measurable difference in corporate performance • Directly or indirectly, most of these key practices refer to the right people, including talent and leadership “The choice of chief executives has as much impact in profitability as the decision by a company as to whether it will remain in the current industry or move to a new one”. Joyce, Nohria and RobersonThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 54

Great People Decisions can be the most important source of company value Year effect Industry effect Company value Company effect Leader In some markets, the leader effect effect accounts for up to 40% of the variance in value Source: “When Does Leadership Matter?”, Wasserman, Nohria and Anand, Harvard Business School working paper no. 01-063, April 2001This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 55

Jim Collins, “Good To Great” Rigorous selection of 11 companies (out of almost 1,500), which achieved and sustained greatness • For at least 15 years • Against comparable companies The right leadership, and the right managers, were the two preconditions for success “First Who… Then What. We expected that good-to-great leaders would begin by setting a new vision and strategy. We found instead that they first got the right people on the bus, the wrong people off the bus, and the right people in the right seats – and then they figured out where to drive it. The old adage “People are your most important asset” turns out to be wrong. People are not your most important asset. The right people are.” Jim CollinsThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 56

What you are looking for can be a moving target Jobs at the top tend to have little stability as priorities and requirements rapidly shift as a result of: • Macroeconomics • Competitors • Technological changesThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 57

The most relevant competencies are the hardest to assess Four core competencies for senior executives are: • Strategic Orientation • Results Orientation • Team Leadership • Collaboration and Influence Each one of these (and many others) is very hard to measure!This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 58

In summary Great People Decisions are very difficult • As Jack Welch put it, “Hiring great people is brutally hard” However, the first step is straightforward • Awareness, to stay away from the usual traps If you want to master people decisions, Awareness is an essential first step, but only the first one: the other steps to master are: • Knowing when change is needed • What to look for • Where to look, inside and out • How to appraise people • How to attract and motivate the best people • How to integrate the best peopleThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 59

We will focus on these elements as we work through the remainder of this session • Knowing when change is needed • What to look for • Where to look, inside and out • How to appraise people • How to attract and motivate the best people • How to integrate the best peopleThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 60

External stakeholder management & the CEO role A key difference: “The Buck Stops Here” Shareholders/owners Government Regulators Press …This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 62

Understanding and building relationships with key stakeholders is fundamental to success Identify stakeholders Identify stakeholders Build relationships Understand attitudes and preferences Understand attitudes and preferences and communicate Understand each Build awareness of stakeholder’s importance stakeholder ’s informal networksThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 63

Interdependencies define the stakeholder landscape and how to prioritise your time in communicating with them “Keep Satisfied” “Manage Closely” depends on you Stakeholder “Keep Fully “Monitor only” Informed” You depend on StakeholderThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 64

Understanding informal networks can be critical in many contexts Sometimes called the “shadow organization” or “the company behind the organization chart” Gareth Brown Group Mahmoud • Every organization has such CFO Controller networks as people tend to defer Senior finance to others’ opinions when it managemen Influences t comes to important issues and Innovation decisions projects Maria KM = key Sanchez • When people do this, the result Abdullah driver Internal Kelly is a set of channels of GM CMO Ex-school Auditor communication and influence Influences friends that operate in parallel with the Sam formal ones Strongly Plant aligned Manager • These networks are important in Ibrahim supporting or blocking change Ex - HRThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 65

“Collaboration & Influencing” is a competency we test in almost all executive candidates Egon Zehnder International Core Competencies • Team Leadership • Strategic Orientation • Market Knowledge • Collaboration & Influencing • Change Leadership • Building Organisational Capability Thought People Leadership Leadership Business Leadership • Results Orientation • Commercial Orientation • Customer ImpactThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 66

EZI Collaboration & Influencing competency People demonstrating this competency are effective in Forges working with peers, partners, and others who are not in transformational the line of their command, to positively impact business partnerships performance. Establishes a collaborative 7 culture Facilitates collaboration 6 amongst others High levels: Motivates others 5 to work with self they have the ability to get others to support initiatives Actively engages and build enduring 4 with colleagues partnerships across organisations and geographies Supports 3 Colleagues Moderate levels: they actively engage in influencing others Will respond if 2 and working as a team asked Low levels: they participate as required but are generally 1 responsive rather than active • Actively resists collaborating Red Flag Behaviours: • Inhibits collaboration by others • Lacks the credibility to influence othersThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 67

Collaboration & Influencing in the C-Suite The two elements of collaboration and influencing are joined together in one scale This skill is essential for success in the C-suite • Not all situations require a directive leadership style • In some situations a directive leadership style might even be counter-productive – Some key stakeholders would not accept a directive style • People at the top level tend to be more motivated when they get influenced versus when they are directed – “self-discovered logic” is a powerful influencing tool “What are your experiences on this matter that you would like to share with your fellow participants in this PALM session?”This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 68

Given you have to deliver through others, the quality of your team is key to your success Three core questions you must answer • Do I have the right people in the team? • How effectively does the team perform as a group? – Does the team together deliver more than the sum of the parts? • How will I lead them: what leadership style will I adopt?This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 70

Essential to address the quality of the members of your team as rapidly as possible Remember Jim Collins’ key message in “Good to Great” “First Who… Then What. Good-to-great leaders … first got the right people on the bus, the wrong people off the bus, and the right people in the right seats – and then they figured out where to drive it… People are not your most important asset. The right people are.”This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 71

The best approach is to define the requirements of each role systematically and assess your reports accordingly Egon Zehnder International Core Competencies • Team Leadership • Strategic Orientation • Collaboration & Influencing • Market Knowledge • Change Leadership • Building Organisational Capability Thought People Leadership Leadership Business Leadership • Results Orientation • Commercial Orientation • Customer ImpactThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 72

Scaled competencies are a great tool for understanding the “bench strength” of your team Basic management Increasing stretch – Transformational, competence building towards step change, world class competence visionary competence Reactive Active Proactive 7 Logic of the 6 Competency 5 Scales 4 3 2 1 • understand • apply • improve • try • meet • exceed • interact • collaborate • inspire • willing • doing • delegating • make no • take on ownership • take risks mistakes • be involved • pro active • respondThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 73

There are six key dimensions to effective team effectiveness: EZI proprietary model Degree of to which everyone understands and the larger purpose and focuses their actions in line with that objective, consistently reinforcing it Degree to which the team Degree to which the team comprises a diversity of skills consistently optimizes resources and styles and effectively and time to achieve results, by leverages these ensuring clarity in tasks, decision-making rules and disciplined management process Degree to which the team is Degree to which the team holds exposed to and adopts new itself together and remains thinking from the broader effective under stress, and organization and outside world constructively raises and resolves issues Degree to which the team is energized by working together and is proactive, productive and sustains momentum at a high-level by Low Moderate High reinforcing each otherThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 74

Three levels of performance are described for each dimension Competency Level Description Balance High The team understands the importance of diversity and actively incorporates it • Diverse group (experience, knowledge and functional skills) • Members assume different “team roles” (e.g. mover, opponent, follower, coordinator, evaluator, investigator…) • Skills, strengths and "team roles" are recognized and leveraged Moderate The team understands the value of diversity but is not always capable of using it • Diverse group, willing to make the most of its diversity • Most members recognize skills, strengths and team roles, and leverage them • Or, team not fully diverse: a sizable part of the team brings very similar strengths, skills, "team roles“ Low Team rejects or lack appreciation of different or new approaches, perspectives and contributions from other members • Similar team, narrow range of experiences and perspectives; homogeneous skills, strengths, "team roles" • Or, the expression of the team’s diversity is hindered by some overpowering individuals and/or self-censorsThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 75

Case Study: A large multi-cultural team of mostly high achievers, dissipating precious energy in their interactions Client Context (October 2008) €3B Regional telecom operator • A newly-formed (within previous year) multinational leadership team striving Team = CEO plus 13 members of to establish a common norm for collaboration. The team was facing substantial the Executive team pressure to perform in a highly competitive environment, where new business models and a new management culture were needed Key issues identified Key recommendations Changes made to improve • Key issues revolved around: • Reach consensus regarding impact of the team objectives’ feasibility and implied • Individual feedback – based on • Incomplete alignment of actions to achieve them references – impacted and functional strategies, which led (strategy workshops) changed some team members’ to friction and inefficiencies • Accelerate the alignment of the behaviors • While certain personalities organizational structure, • More balance has been were overpowering, others’ capabilities and processes with achieved in airing of views – contribution was limited the executive team’s objectives overpowering individuals toned • Under high pressure and and plans down attitude, others speak up uncertainty, team’s resilience more • Ensure appropriate was fragile (blame tendency, prioritization of focus areas • Culture of openness and cultural stereotyping, difficulties in managing conflict) • Strengthen meeting decision- feedback fostered during the making efficiency team discussions contributed to the CEO and HR requesting a • Build cohesion to help follow-on Management Appraisal dissipate tensions (minimize of the top team one year later CEO arbitrator role, facilitate airing of dissenting views)This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 76

EZI team leadership competency: how much empowerment does your team need to function effectively? People demonstrating this competency can focus, align, Builds and sustains a high- and build effective groups performance team culture Motivates high- performance 7 teams Empowers teams 6 to perform Actively involves 5 team High levels: they build teams that Allows input from 4 can define many of team their own goals Explains what to do 3 Moderate levels: and why they involve the team in goal setting Uses directive 2 approach Low levels: 1 they set goals for the team Red Flag •Provides no direction Behaviours: •Avoids leadership responsibilityThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 77

Why invest time in preparing your integration? Effective preparation means you will be able to deliver more impact more quickly • A sure-footed start will seal your reputation • With effective preparation you can hit the ground running and reach full effectiveness months ahead of expectations There is typically a lot to learn, and you need to prioritize for impact • Be sure to access others’ experience to help you focus your efforts The faster you build confidence and trust with key stakeholders, the better your prospects • Focusing on your integration involves understanding those stakeholders early… ….and investing time in building effective relationships with them right from the startThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 79

Seven keys to effective integration into a new role 1. Start early 2. Deploy as many internal resources as possible to help 3. Take a systematic approach to the “soft side” 4. Create rapid feedback loops 5. Sequence integration activities carefully through the first 90 days 6. Focus on building openness and trust 7. Access to confidential insight and tailored support in the first 90 daysThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 80

You need to own your integration, but bring in others as appropriate EZI Consultant (where relevant) EZI Consultant (where relevant) HR Professional HR Professional •• Acts as trusted advisor and confidant Acts as trusted advisor and confidant •• Brings organisational perspective Brings organisational perspective •• Tailors EZI framework and tools Tailors EZI framework and tools •• Supports hiring manager and Supports hiring manager and •• Facilitator and sounding board Facilitator and sounding board executive, channelling organisational executive, channelling organisational resources resources New Executive New Executive •• Owns his/her integration Owns his/her integration •• Leverages EZI and internal Leverages EZI and internal support support Hiring Manager Hiring Manager Buddy Buddy •• Signs off integration process Signs off integration process •• Typically a peer Typically a peer •• Champions integration internally Champions integration internally •• Supports executive with Supports executive with •• Provides executive with information, Provides executive with information, advice on how things advice on how things introductions and feedback introductions and feedback work in the new organisation work in the new organisationThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 81

Think through the challenges of your specific context Each integration context presents different challenges Extended transition: starting long before the predecessor leaves Operating at a In an more senior international level than in assignment their previous Moving to a for the first company… company with a time… radically different culture… Moving to a Moving from a company in a line to a matrix state of flux… management Coming in to role… manage a rapid turnaround…This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 82

Five critical Integration Pillars you need to address: Where should you be after your first 100 days? Five Integration Pillars – “the what” Is credible in the operational driving seat: Assume operational Has an understanding of the priorities of the role, has started taking key decisions and has leadership gained momentum with early wins Has personally connected with the team and is starting to shape it: Take charge Executive and team members are aligned behind priorities; the executive is aware of their of the team capabilities and gaps and has begun to take action towards building up a winning team Is woven into the fabric of the organisation: • Has succeeded in launching long-term working relationships with peers, has agreed with them Align with stakeholders how to work together to ensure delivery, and is tapping into informal networks • Has deeply engaged with hiring manager enabling early alignment on the core agenda Is already working constructively through an understanding of the culture: Engage with the culture Is using a deep understanding of the culture to make a positive first impression and to get things done more effectively Has built the foundations for addressing longer term strategy going forward: Build may be more or less progressed in the thinking, depending on the context strategic IntentThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 83

EZI Accelerated Integration: One way to get to full impact faster… Pillars – “the what” Phases – “the when” Assume operational Before Start 30 Days 90 Days leadership Take charge of the team Maximise Demonstrate Invest for Initial Ability to Align with stakeholders Success Impact Deliver Engage with the culture Build strategic intent PHASE I PHASE II PHASE IIIThis presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011 84 84

Egon Zehnder International Program for Advanced Leadership and Management Good luck succeeding in the C-Suite! Dr. Mark Byford Johan H. Brand Madinah, KSA January 27, 2011This presentation is confidential and specifically for use in the MILE PALM 2 program; it is not to be shared with any 3rd party without prior written consent of Egon Zehnder International © 2011

Succeeding in the c suite

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Succeeding in the c suite Presentation Transcript