KEY CONCEPT

CEOs must be informed at all times about all internal and external facets of the company relevant to his or her performance as leader of the company. A personal knowledge infrastructure, based on the right practices, relationships and tools and aligned with the needs and personality of the CEO, can make the difference between leadership success and failure. 

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IDEA SUMMARY

CEOs are responsible for knowing what is going on in their companies. No matter how large, complex or global the organization, CEOs do not have the luxury of pleading ignorance; it is their job to keep abreast of all the important facts and developments: what their employees and competitors are doing, what big new ideas on the horizon can impact their companies; what is happening on the regulatory front; and so forth.

New technology, big data, and better dashboards are some of the tools that CEOs can use to help them keep informed. However, it’s a mistake, according to one group of researchers, to believe that more tools and technology is the simple answer to the growing challenge of ‘staying in the know’.

The researchers conducted a two-year study that followed the day-to-day work of seven UK CEOs in charge of the largest hospital- and mental health-based organizations in the country. In an industry that combines the pressures and expectations of both the private and public sectors, directing such organizations is one of the more complex challenges for any leader. Staying informed is absolutely vital. How do they do it?

According to the research, the answer lies in building a personal knowledge infrastructure that consists of three components:

• Routine practices. These practices range from watching the news, one-on-one conversations (formal or impromptu) with direct reports and employees and ‘walkabouts’ to meetings with board members and other CEOs, attending conferences and staff events, and participating in charity events.
• Social relationships. CEOs should cultivate strategic relationships, both inside and outside the organization, designed to give them the broadest sources of information, both formal and conjectural. All contacts are not equal, ranging from the occasional check-in with well-placed acquaintances or former employees to close relationships with an ‘inner circle’.
• Tools of the trade. These include traditional sources of information, such as emails, phone calls, reports, and trade journal articles, but non-traditional sources of information — blogs, twitter and other social media — are equally important. Electronic reporting systems or audit-based dashboards monitoring key performance indicators are also highly useful.

The different CEOS who were the focus of the study worked with different combinations of these factors; as indicated by the terminology, the goal is to pull together a personal knowledge infrastructure: one that best fits the needs and preferences of the individual CEO. Different factors, the research shows, will impact the most effective combination of tools, practices and relationship for individual CEOs. CEO experience, job tenure and the make-up of the executive team, for example, can influence the social relationships that CEOs are able to build. Changing organizational conditions and pressures or a new strategy can require an overhaul components to meet changing needs. And the kind of manager that a CEO wants to be can make a difference: a strong presence on social media is appropriate, for example, for a CEO who wants to be personally engaged with his customer base. 

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BUSINESS APPLICATION

Building a personal knowledge infrastructure of high quality and perfect fit with the your personality, your aspirations as to the type of manager you want to be, and the circumstances of your firm is key to leadership success. A knowledge infrastructure that is not aligned with your needs will suddenly and perhaps disastrously reveal itself when something goes wrong: an unexpected industry-changing product from a competitor or significant wrongdoing in the firm, for example.  

Here are four potential traps that can undermine or destroy the effectiveness of your personal knowledge infrastructure:

• Not obtaining the information you need. Many CEOs decry receiving too much information, but the real danger is receiving irrelevant information.
• A personal knowledge infrastructure that points you in the wrong direction. If innovation is the key to survival but operational information is what you’re getting, your attention is focused on the wrong things.
• A personal knowledge infrastructure that is not ‘you’. For example, you want to delegate more, but your information only helps you to be more ‘hands-on’.
• Starting with technology not need. Some CEOs let the technology decide which information they will receive.

How can you improve your personal knowledge infrastructure? Here are some questions to guide you:

• What kind of manager do I want to be?
• With which tools and ways of doing things am I more comfortable?
• What is the macro-environment, such as regulatory context, of my firm?
• What are the present opportunities and challenges of my firm?
• Where do I want my firm to go?
• And finally, do I have the right combination of people and tools that helps to keep me in the know of what’s important and what will help me accomplish what I need to do?

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REFERENCES

Staying in the Know. Davide Nicolini, Maja Korica & Keith Ruddle. Sloan Management Review (Summer 2015). 

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