Authentic Leaders: The Calling

Part One of Two Parts

Increasingly, startup workers expect “authentic leadership” from their CEOs and ELTs, leaders who are open about the state of the company and, when needed, themselves.

Thanks to his frankness about personal and corporate shortcomings, Apple CEO Tim Cook is often cited as the archetype of this leadership type. Cook never shies away from responsibility for product failures, for example, and often bares his personal foibles, too.

Americans’ trust in their media, political, and business leaders has largely collapsed. The current social and political culture in the US and abroad is toxic. Tribalism prevails. This collapse occurred even as executives at publicly-traded companies earn hundreds of millions of dollars, while their workers earn a fraction of that.

CEO transparency—often used interchangeably or simultaneously with CEO authenticity— involves plain, intelligent, and open communications. This results in trust and a sense of security, and instills in employees the sense that they work for a company with high ethical standards.

One avid reader offered this insight: “As a worker you want your CEO to be both transparent and authentic. Generally you only get one.”

I couldn’t agree more.

Before the PC and networking revolution of the 1980s, business leaders often acted like “Imperial CEOs,” highlighting strengths and diminishing shortcomings. They left no room for genuine insights into the state of their businesses, or the CEO’s true thinking and self.

The Internet Bubble produced a more open, opinionated, and visionary type of leader. This included Jeff Bezos, the Google trio, and Mark Zuckerberg. Eventually, Uber’s Travis Kalanick and Elon Musk joined the scene. These leaders were often called, for one reason or another, “Self-Serving CEOs.” They spoke in hyperbole, and often paid lip-service to real and important social initiatives, like diversity, in the interest of unchecked growth.

Today’s CEOs and ELTs are more likely to be transparent. They are apt at communicating personal shortcomings and business vulnerabilities, both at work and in public.

Those resistant to this idea fear that transparency can be mistaken for weakness or evidence of unsolvable deficiencies. CEOs in ultra-competitive technology markets dread providing adversaries with ammunition or opening themselves to heightened criticism from their Board of Directors, organizational politics, or outright defiance by the ELT.

CEOs and ELTs must make clear to the press, Board, ELT, company employees and, of course, family members, the following type of vulnerabilities:

1. The Human Reality. CEOs are human beings who have emotional and physical limitations that can turn up at any time. Physical exhaustion, burnout, depression, and information/priority overload are all part of their realities. Failure to acknowledge these basic vulnerabilities can breed overconfidence and, with time, to significant mental and physical consequences.

2. Interpersonal Trust. Trust is fundamental to business. Every relationship in a business environment depends on it. Trust can be extended to investors, board members, consultants, partners and others. Those around the leadership team are expected to operate in good faith. It also means that the leader has to accept a level of vulnerability based on putting dependencies in place—things like commercial relationships, or following through on a due diligence item, etc. Problems arise when too much trust is placed in people who lack integrity, motivation, or are simply incompetent.

3. Vulnerabilities Related to Externalities. Leadership traits during Salad Days may not translate or apply to a downturn. After years of high valuations and easy money, some current startup CEOs, ELTs and Boards may not adjust well to leaner times, cost-cutting measures, down rounds, etc. Securing funding is vexing in the best of times, but try competing for funding with a glut of capital seekers. Acknowledging vulnerabilities when things are not going well can seem like a bad idea. Recently when revenues flagged in some firms, employees and investors quickly got fatigued by the oft-repeated “COVID pandemic supply chain challenges” excuse. Leaders capable of real introspection and empathy can adapt well to these circumstances and triumph.

The challenge for today’s authentic leaders is to be transparent, while embracing their personal human vulnerabilities and business vulnerabilities. While the Imperial CEO is dead and buried, the authentic leaders of today are not fully realized.

In next week’s blog post, Part Two entitled Authentic Leaders: The Practical Side, there is a step-wise process put forward for startup leaders and others to follow.

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