LEADERSHIP DIM SUM, PART I: HOW INTIMATE IS YOUR INNER CIRCLE?

The CEO now has 11 direct reports. He convenes a twice-monthly management group meeting of those direct reports, plus their top lieutenants. Nearly 60 people now take part. The pace of these meetings has become one of “report-out” after “report-out.” It has turned into serial information delivery at turtle speed. And there isn’t much, if any, depth to the discussions. Virtually no business gets done there any more.

Things to think about: How does one define what “at the top” really means? Is a group of 10 (or 20 or 60) too many? How does the rest of the organization see an inner circle? What expectations do they have of its members?

We began with this scenario because we felt it was important, as we begin the Leadership Dim Sum series, to tackle the important question of who, exactly, we’re including in our definition of “at the top.”

Where Did the Inner Circle Go?
A leader’s vision of his or her inner circle and other individuals’ views on who that circle includes, or should include, may be different. Someone recounted to Annie their experience of being hired into a management position in fast-paced start-up. Before this person was hired – when she was considering the job, and the company was similarly considering her – she was given access to everything. “Business plans, confidential financial models, detailed results, you name it,” she recalled. “ The CEO asked me for strategic advice, and, I felt, truly valued my input.”

Then she joined the company. And almost immediately, she realized that she was not, in fact, a member of the inner circle. “Perhaps no one is a prophet in their own land. It was striking how forthcoming he was with information in the recruiting phase, and how receptive he was to my ideas, and how much that changed once I actually joined the organization,” she explained. "The problem was that I had been given enough data ahead of time about revenue projections, and I had access to daily revenue numbers, so I quickly realized that the company was in trouble. Yet when I asked for confirmation – and wanted to weigh in with my opinions – the CEO shut me out, told me everything was ‘just great.’ To compound things, the other people in the organization expected me to have information because they thought that I was in the CEO’s inner circle. So they were less trusting of me because they felt I was hiding things, holding back.”

While the size, scope, and definition of an inner circle may vary, we tend to think of them as being the small cluster of individuals surrounding a particular executive who share most confidential data and who feel comfortable speculating on outcomes and scenarios with one another.

How Big?
Is there a tipping point? We think there is. We think the ideal inner circle is made up of no more than six or eight people (OK, nine if you really stretch). Our sense is that if the group gets much larger, it’s not really an “inner” circle at all. A larger group cannot develop the intimacy of a smaller one – and the bonds of trust are more likely to form within niches within the group, rather than between and among all members. You should use your own judgment in the matter – your organization has its own unique dynamics, of which we have no knowledge -- but keep in mind that it is always easier to expand a circle than it is to shrink it.

One of our clients uses the concept of chairs at a table to determine the optimum size of their inner circle at the corporate and regional levels. They look at how many chairs are placed around the table, and who is sitting at each chair. They have found that eight to ten chairs works best for them. But they always have to ask the question - do we have the right people in the right chairs? Good for them for constantly asking.

Should an inner circle be dictated by the org. chart? To a great extent, yes. Let’s put it this way: If there is someone on your senior management team whom you do not feel comfortable including in your inner circle, then it’s time to consider whether that person in fact belongs that high in the organization in the first place.

And is it important to be clear about who’s in? You bet. If not explicitly, then implicitly. Remember Tom Wolfe’s The Electric Kool-Aid Acid Test? In it, he talked about being either “On the bus” or “Off the bus.” If you were on, you knew it. And if you had to ask if you were on, you weren’t. Don’t make people ask. Be careful not to lead people astray by giving them signals that could be subject to misinterpretation. If someone is not in the inner circle, don’t give them information that would lead them to believe that they are.

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