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Why Don’t CEO’s Get Fired Like NFL Coaches?

01/03/2012

‘Tis the season for coaching changes in the NFL and college ranks. Abysmal performances typically lead to change of leadership. Right now the St. Louis Rams, Tampa Bay Buccaneers and Indianapolis Colts all have management changes taking place. And there may be other teams doing the same soon.

So why is poor performance dealt with swiftly in the NFL and not in the corporate boardroom?

Certainly there is plenty of C-level mediocrity in business today. For example, Reed Hastings who oversaw decision-making that led to a stock decrease of 76 percent,  has essentially driven Netflix into the ground. Hastings is taking a pay cut to $500,000 for a total package of $2M in 2012. Ouch.

Then there’s Brian Dunn, CEO of Best Buy. The company alerted some customers that it would not be able to fill their online orders, just days before Christmas. The largest specialty electronics retailer said that overwhelming demand for some products from Bestbuy.com has led to a problem redeeming online orders made in November and December. That’s a cardinal sin in any direct merchants book. Seems as Dunn has held on to his job.

Back to my rhetorical question: So why is poor performance dealt with swiftly in the NFL and not in the corporate boardroom?

In the NFL every play, each personnel decision, and, of course, the results – are played out in front of the public. Replayed, slow motion, highlight reels and talk show discussions. There’s no hiding from the results. Not so in business. It’s often difficult to connect decisions with results. Largely because of time. Rarely, in business today, do decisions made play out until months later. As a result it is harder to connect the dots between lame decision-making and poor results. Of course the same goes for good decision making…but management teams are always better at self-congratulatory activities than dealing with the tough stuff.

Wholesale axing of CEO’s and other management team members is not the solution – nor my desire. Running a business in today’s complex environment is really tough. But I do think companies can learn from the NFL style of results or bust operations. Leadership with its feet to the fire always runs faster.

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