My Number One Challenge as CEO

It’s a well-known secret that executives, especially CEOs, often work within an information silo – where what they hear is what employees believe they want to hear – and bad news often struggles to find its way into their purview. I recently spoke with Hal Gregersen and the Harvard Business Review about this challenge. Hal appropriately titled his article, “Bursting the CEO Bubble,” and it's a good read for any employee from executive leadership to entry-level.

For leaders as well as employees, it’s critical that we acknowledge the information silo and work together to solve for it. There are three areas we can continually challenge ourselves to focus on, which I’ll touch on below. No matter where we are in our careers, we can all benefit from continuing to ask the tough questions, being open to hearing critical feedback, having the courage to speak up, and striving to challenge the status quo.

1. Listen. Listening sounds like simple advice, but it can be difficult, especially for executives who are expected to be decisive and full of wisdom and advice. Make sure to minimize time in your office, visit locations away from headquarters, and meet face-to-face with your many stakeholders – from employees and clients to analysts and owners. It’s that simple – but incredibly important. As Hal points out in his article, you can’t possibly know what you don’t know.

For over thirty years I’ve asked my direct reports to prepare “Brutally Honest Reports” twice monthly. These reports ensure that both good and bad information is openly discussed – with nothing held back. Over the years, this practice has expanded to where it is now used by other leaders across Schwab – and serves as a powerful tool for fighting the information silo.

2. Ask questions. If you’ve stuck with me this far, it’s likely not a surprise to you that asking questions is imperative for the work I do day-to-day, for our approach to Schwab’s business, and in how we encourage clients to engage in their own lives.

The question I am always asking of employees, owners and analysts is: “If you were in my job, what would you be focusing on, or what would you be doing differently?” That open-ended question makes it comfortable for others to offer me criticism and feedback in a way that avoids the common fear of: “Can I really tell Walt that?”

3. Stay humble. A lot has been written about humility in business. In fact, if you do an internet search for “humility in business” you get over 20 million results. Clearly, leaders are not always right and it’s important to acknowledge that. I personally believe that the difference between successful and unsuccessful executives is rarely decision-making skills, but the ability to identify a poor decision quickly and the willingness to admit the error and adjust accordingly.

For me, staying humble takes many forms. I often visit Schwab branches, service centers and clients across the country, always making a point to share with them my information silo challenge. And I ask for their help, sharing that their willingness to tell me “what I don’t know” is one of the greatest gifts they can offer. After all, no executive can know everything, and the best run businesses know the key to success often resides with the information known by those closest to the client.

I’ll leave you with one final thought in the form of an excerpt from Hal’s article – it’s a lesson that I will continue applying to myself in the days to come.

“Innovative executives deliberately put themselves into situations where they may be unexpectedly wrong, unusually uncomfortable, and uncharacteristically quiet. In so doing, they increase the chances that the right questions will surface to help them pick up on critical weaknesses.” – Bursting the CEO Bubble, Hal Gregersen, Harvard Business Review

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