Executives are paid for their Judgement

Shortly after I was hired as Vice President of a large transportation company in Baltimore, Maryland the owner decided to hire another man to oversee much of my work in helping to expand the company. Ron came in with his own Executive Assistant who had been with him through previous jobs and he came with a wealth of experience and knowledge.

I was still fairly young and while I had been in management positions, was not really an “executive” in the real sense of the word. I remember one day, Ron’s executive assistant told me that in no uncertain terms. She said “you’re not an executive”. It was a pejorative jab and cut me to the quick.

Being young and full of vim and vigor I was offended..but she was right. 

Later when Ron was coaching me on how to become an executive he told me something that I’ve never forgotten. He asked me “Do you know what executives get paid for?”…. after I paused he asserted, “Executives get paid for their judgement.” Wow. That’s something I never would have thought of at the time. Perhaps I would have thought, their wisdom, ability to forge new paths and get their employees to follow them etc… but no, he stated it was their “judgement”. Ron had been an executive for many years in major organizations and knew his stuff and I still have great respect for him.

As I’ve pondered that guidance over the years I believe he was right. Real executives who lead large and small organizations are charged with making the tough decisions. The easier ones get made before they come to you. Mid-level managers can handle the day to day tug and pull of the organization. There are work rules and administrative regulations that guide routine decisions and then appeal processes that often repair mistakes from those. 

But the major, gut wrenching, hair pulling and potentially organizationally fatal decisions that everyone is afraid to touch end up at the Executive’s desk. So what does that Executive need in order to make a reasoned, wise decision? 

Good judgement better yet, excellent judgement. Judgement that has been forged in the fires of a hundred smaller decisions with the outcomes weighed afterwards to determine which ones worked and which did not. Judgement that comes from further analyzing those smaller decisions to determine why they did or did not produce the desired outcomes. Mental integration of the reasons why and then application of the lessons learned for new decisions. 

That is what makes you an Executive. This is what’s required to earn that judgement that only comes from error and learning from it. 

When I served as MTA CEO in Baltimore many years later I spent most of my time making decisions. I remember thinking at the time that Ron’s admonition rang truer now than ever. With over 3,000 employees and a billion dollar operating and capital budget I was being asked to make decisions from week one on major projects, the direction of a state agency that affected hundreds of thousands of lives on a daily basis and personnel choices that impacted employee's careers. My children asked me shortly after I took that job, “Dad, how do you know what to do?” While some of my employees at the time might have argued that I didn’t, I felt better prepared than at any other time in my life for this job because of the thousands of choices I already had made and evaluated in a 28 year career spent in transportation and government management.

So when the choices of this newer, larger position were presented I followed the principles I had learned from making many poor choices and good ones that worked during my previous jobs. One definition of judgement is “the ability to make considered decisions or come to sensible conclusions”. 

So to be an effective executive one needs to have learned from previous choices what the options are and then weigh them based on those lessons learned to choose a course of action that will lead to the best or most desired outcome.  

Executives are called upon to lead. Leadership requires making the tough decisions. The success or failure of an executive is often determined by the outcome of those decisions. Decisions made most wisely are informed by the lessons of previous choices. Executives need not be old but they must be seasoned in order to truly lead effective and successful organizations because they are paid for their judgement!

By Paul W. Comfort, Esq. (c) 2018 All Rights Reserved.

As previously published on www.business.com