The rise of the human-centric CEO

Romeen Sheth Contributor

Romeen Sheth is president of Metasys, a workforce-management firm based in Atlanta.

Steve Schlafman Contributor

Steve Schlafman is founder, coach and angel investor at High Output, a boutique leadership-development company based in NYC.

Peacetime CEO/Wartime CEO by Ben Horowitz is one of the most commonly cited management think pieces of the last decade.

And for good reason; Horowitz surfaced a fundamental distinction in operating philosophy that is necessary for companies to survive, reinvent and ultimately win when macroeconomic environments shift. The framework is especially useful given how counterintuitive the advice is — behaviors of a peacetime CEO and wartime CEO are often on diametrically opposite sides of the spectrum; it is rare to find a CEO who can successfully emulate both personas.

While in concept it is easy to understand these principles, as with most things in life, nothing can replace the visceral comprehension that comes via learned experience. We are at the onset of enduring the most challenging startup environment of (at least) the last 15 years. COVID-19 is an indiscriminate event that is systematically wiping out businesses, whether “atoms” or “bits.”

For most startup operators, this is the first taste of true systematic adversity. The undercurrents of frothy valuations, the social milieu of early-stage investing and stores of excess capital are coming to a grinding halt as the bull market of the last 12 years is dramatically disrupted. We have an entire generation of founders/CEOs who may conceptually understand the peacetime CEO/wartime CEO ethos, but now, they’re going to actually live it. At the same time as every other founder/CEO. Brutal.

Since the onset of COVID-19, we have spoken to more than 100 founders and CEOs. Naturally, we are hearing frequent allusions to peacetime CEO/wartime CEO as a framework to help navigate the landscape. We’ve even used it over the last few months. While we believe it is a helpful framework, it is also incomplete. Further, we believe its application can lead to deeply problematic outcomes.

At a micro level, the misplaced application of peacetime CEO/wartime CEO can fundamentally change a company for the worse. A wartime CEO, as Horowitz notes, is “completely intolerant, rarely speaks in a normal tone, sometimes uses profanity purposefully, heightens contradictions, and neither indulges consensus building nor tolerates disagreements.” In the strictest application, we are seeing this align with a common false trope that has plagued the tech industry: “To change the world like Steve Jobs, I need to emulate all aspects of Steve Jobs’ personality.” A classic logical fallacy many founders/CEOs have learned the hard way — if you emulate all aspects of Steve Jobs’ personality, it doesn’t mean you will change the world like he did.

Each company is driven by its own unique culture and values — in a crisis situation, while it is important to be adept and agile, it’s equally, if not more important, to triple down on the strongest elements of your culture established pre-crisis. Many of the strongest founders/CEOs we have had the pleasure of coaching and investing in are uniquely world-class in their patience and tolerance, their ability to make the abnormal normal and their commitment to inspire with clarity. It is the adherence to these principles that will help carry their companies through this time.

At a macro level, peacetime CEO/wartime CEO conjures outdated themes that are at best inaccurate, and at worst, counterproductive. War implies “destruction, ruthlessness, blood, death;” there is an innate sense of machismo and bravado in this language reinforcing a homogeneous tech community. This type of vernacular and attitude increases barriers to a more inclusive community excluding women and underrepresented minority participation.

Now is the time for us to propagate community, resourcefulness and generosity.

One of the most common takeaways we have heard in reference to the framework is, “now is the time when real founders are made.” If Rent the Runway, ClassPass, Away, the Wing and the countless other women-led/minority-led startups that have been adversely affected by COVID-19 are not able to bounce back, we highly doubt it is because “they weren’t able to cut it as real founders,” a ridiculous assertion to make under any circumstance.

The peacetime CEO/wartime CEO framework is clearly valuable — it forces us to dissect the behavioral shifts necessary to survive in a crisis. That being said, it needs to evolve. Being firm, decisive and staring down an existential crisis is not mutually exclusive with applying empathy, gratitude and generosity. You can be an intense, laser-focused and paranoid CEO without losing yourself or fundamentally changing the culture of your company.

We know dozens of leaders who are leading their companies through these challenging times without leaving a wake of carnage or damage to the foundation they have spent years building. They are leading with their heart and values and will be remembered for how they carried themselves, treated their employees and guided the company through the crisis. COVID-19 presents us with a unique opportunity as an industry. Now is the right time to retire the false dilemma of peacetime CEO or wartime CEO and empower the rise of the human-centric CEO:

• The human-centric CEO considers and balances the needs of her organization, employees, customers and other stakeholders in good and bad times;
• The human-centric CEO recognizes she cannot change the macro environment or competition so she focuses her effort and energy on what she and the team can control and manage;
• The human-centric CEO internalizes his mission, vision and values in the face of difficult challenges and critical strategic decisions;
• The human-centric CEO views and manages her company as a complex and dynamic human system with nuanced inputs and interdependencies;
• The human-centric CEO believes employees are the single most important stakeholder — that is reflected in how the organization hires, coaches, trains, incentivizes and retains;
• The human-centric CEO orients around decisive and bold decisions that impact employees rather than a series of micro maneuvers that damage culture and trust;
• The human-centric CEO creates shared meaning and purpose by reiterating the mission and vision over and over and over again;
• The human-centric CEO fosters an organization that values and cultivates psychological safety;
• The human-centric CEO develops self-awareness and inner resilience to weather the emotional ups and downs of company building;
• The human-centric CEO invests the time and energy to go deeper with her employees at strategic junctures and times of crisis;
• The human-centric CEO distills and simplifies issues, strategies and tactics to help employees reduce noise and increase focus;
• The human-centric CEO communicates frequently and articulates expectations with humility and confidence to avoid uncertainty, prevent anxiety and achieve alignment;
• The human-centric CEO recognizes he has a range of communication mediums at his disposal and selects the most appropriate one based on the magnitude of the situation;
• The human-centric CEO believes in the power of company rituals such as one-on-ones, exec team meetings, all-hands, stand-ups, retrospectives and off-sites;
• The human-centric CEO expresses empathy, appreciation and gratitude for the work performed by existing, outgoing and former employees;
• The human-centric CEO listens intensely and empathetically with her full self — ears, eyes and intuition;
• The human-centric CEO takes out time for self-care because she understands she cannot serve others and be highly effective unless she is mentally and physically healthy.

There’s no way to mince words. COVID-19 is having a devastating impact on the startup community. The inevitable is unfortunately occurring every day — many startups will never come back from this. As eternal optimists, however, we see opportunity in this crisis for the broader industry: the rise of the human-centric CEO. Now is the time for us to propagate community, resourcefulness and generosity. It’s the time to be ever thoughtful about employees, colleagues, stakeholders and fellow founder/CEOs in need. Individual startups may not survive this crisis, but it is our hope that an everlasting mentality does.

By no means is this list exhaustive, but it captures the behaviors and attributes from the top leaders we are working with. We believe CEOs should strive to become human-centric. Not only because it’s the right thing to do, but also because we believe it will lead to healthier organizations and better results over time.

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