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How to Manage CEO Expectations

March 21, 2007

Does your CEO have a realistic view of your safety program? Or does he or she expect safety to solve all the company's problems? Bloated expectations on the part of a CEO are a recipe for ultimate disappointment and failure. As a safety director, you must align CEO expectations with reality. Here's some advice to help you do so.

Corporate Acceptance of Safety

Sometimes we forget that, until recently, many people considered safety to be an arcane subject of interest only to the lowest levels of an organization. Not long ago, safety directors had to go to executive suites and grovel on their hands and knees for corporate resources.

Times sure have changed. Safety directors still have to sell their programs to upper management. But today, there are fewer people in corporate circles who have to be convinced of the power and importance of safety to organizational success. Images and issues from the world of safety have become part of mainstream corporate American business culture. New processes and programs are touted as "revolutionizing" everything they touch.

Bloated Expectations

Now the pendulum is swinging in the other direction. Safety directors are in a much stronger position to sell their safety programs. But they also have to guard against overplaying their hands and promising miracles they can't deliver. This is especially true when dealing with the CEO. After all, chief executives are bombarded with messages about the wonders of technology; so are the shareholders, analysts, board directors and others that surround them.

All of this is a recipe for out-of-control expectations. And it forces safety directors to walk a fine line. As technology advocates, they must persuade the CEO that safety is worth a hefty investment. At the same time, they need to avoid the fostering of unrealistic expectations.

Aligning Expectations with Reality

Here's my advice for safety directors seeking to strike the balance between advocacy and over-promising:

*Keep Your CEO Informed

Schedule regular briefings to keep the CEO up to date on developments both within and outside the company. Categorize developments according to their business impact. For example, distinguish between initiatives designed to comply with regulatory requirements that your company must meet immediately and long-term investments that may provide your company a competitive advantage over a period of years. When you propose changes, provide a realistic forecast of the costs, training time and work disruptions involved.

*Speak in Business, Not Technical Language

Your CEO is probably more interested in profits and losses than in TRIRs and LTAs. So, whenever possible, translate technical details into business benefits. For example, if you have to talk about LTAs and spills, don't worry about the OSHA and EPA definitions. Instead, describe these concepts in terms of their impact on the business. Keep in mind that the best way to justify large investments is to state their contributions to future revenues. Quantify benefits with hard numbers. Example: "A 20% decrease in incident rate means a corresponding increase in the productivity and profit and minimizes operating costs."

*Be Sensitive to the Human Impact of Change

In many cases, the biggest obstacle to adopting safety initiatives, such as implementing a new safety management system, is not the technical but the human implementation - that is, the changes it will force on people in the company. Change may be positive and even necessary; but it's rarely easy. So make sure your CEO understands and can prepare for potential resistance within the company to the initiative you're advocating. Be sure the benefits of the change outweigh the costs, and explain those benefits to all employees early on to get them on board.

*Don't Make Claims that May Come Back to Haunt You?

Over-promising is the leading cause of unreasonable expectations. It's also the most preventable. A massive new behavior-based safety program may reduce incident rates. But if it won't necessarily bolster profits, don't tell your CEO that it will. Take a page from media-savvy sports coaches who publicly praise the team they're getting ready to play, even if they know that team is terrible. Avoiding statements of hubris shows respect to the opponent and helps manage the expectations of fans so they don't take victory for granted. Safety directors should apply the same tactics when advocating safety programs to their CEOs.

Conclusion

Selling safety is easier today than it's ever been. But so is overselling safety. Promising benefits that you can't deliver and understating the challenges that you face might succeed in gaining initial buy-in from the CEO. But it will also set you up for eventual failure. In short, CEO expectations must be managed, not manipulated. If you make conservative predictions (under-promise) and deliver business solutions that exceed expectations (over-deliver), your CEO will see you as a consistent winner. And rightly so.


GO FIGURE

10.5 MILLION

This number describes something about the state of U.S. roads. Can you guess what it is?

CHOICES

a. The number of alternative fuel vehicles on the nation's roads

b. The number of traffic fatalities since 2000 that could have been prevented if victims were wearing seatbelts

c. The estimated number of elderly drivers who have poor vision and/or mental infirmities who are on the nation's roads

d. The number of traffic accidents caused by drivers as a result of cell phone distractions since 2000

ANSWER

a. There are 10.5 million alternative fuel vehicles on the nation's roads today, according to R.L. Polk and Co. Some of Polk's other findings:

  • 1.5 million alternative fuel vehicles were sold in the U.S. in 2006, surpassing automakers' expectations by 50%
  • There are now 60 models of alternative fuel automobiles for sale as compared to just 12 in 2000
  • Alternative fuel options include hybrid electric, ethanol-capable E-85 and clean diesel.

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