I spoke to Terry Cavanaugh, former CEO and President of Erie Insurance Group, about his journey and best advice
Adam: Thanks again for taking the time to share your story and your advice. First things first, though, I am sure readers would love to learn more about you. What is something about you that would surprise people?
Terry: I love to cook! I am close to being a gourmet chef. I am self-taught and love all aspects of the kitchen and cuisine. One of the “bucket list” items I had was to be able to attend one of the Culinary Institute of America executive education programs. I spent a week at their New York campus last summer and refined my approach to cooking both physically and mentally!
Adam: What is something that would surprise people about life as a Fortune 500 CEO?
Terry: I cannot speak to the others that have had that role in the past or present. I think like many things in life each CEO role is unique based on the individual, company culture and business strategy. Perhaps the aspect I would mention is that being a CEO is not as “glamorous” as people may think. We are pulled in many directions with our decisions affecting many constituents (staff, shareholder, customer, government and community) in a variety of ways. We are on call 24/7 – 365 days a year. There is not a waking moment where you do not realize the role you have and the obligation that comes with it.
Adam: How did you get here? What failures, setbacks or challenges have been most instrumental to your growth?
Terry: I had several strong mentors early in my career that honed my skills and gave me career opportunities at an accelerated pace. I always took the opportunity to learn about the entire enterprise and not have tunnel vison relating only to my business unit. I took people to lunch from other business units to forge friendships and learn from them. I am also a great “student” of commerce. I love to learn about other industries and companies and how they compete and evolve. I still read dozens of periodicals a month and always have a business book on my nightstand.
The keenest learning moment for me came in my early 30s when a received an unexpected promotion as a result of an unanticipated death. The job was large and had been held by a beloved leader. I was unprepared for the complexities of the assignment and subtleties of leadership. My leadership team all were older and had more experience – they knew they had an imperfect leader.
I learned to trust others, admit to others my strengths and weaknesses and define the emerging role I could play for the greater good of the unit and the company. Intelligence, quick learning, humility and willingness to make the tough decision created a cohesive team that had great success. It turns out the initial pain of this assignment turned into the greatest joy I have had in a corporate assignment.
Adam: What are some the best lessons you learned from your time leading Erie Insurance Group?
Terry: You cannot over communicate. As frustrated as I became sometimes as to the lack of understanding and clarity about our corporate vision and strategy, I learned it was my major responsibility to carry the message across the company and to the customer and community. It needs to be done on a multi-dimensional basis (written word , videos, webcasts, personal sessions, town hall settings, social media, etc.). Being the focal point for company culture and vison and consistently communicating this is one of the highest roles of a CEO.
Adam: In your experience, what are the key characteristics of an effective CEO?
Terry: A person who is not afraid of failure and remembers execution beats strategy. One that recognizes that their moral compass is always visible and never wavers from doing what is right even though it may be hard. Recognizes that leadership is a team sport and that direction and destination is more important than the route.
As CEO you want leave the job being the Champion of Extraordinary Opportunities and not Clearly Excess Overhead!
Adam: More broadly, what do you believe are the defining qualities of an effective leader? How can leaders and aspiring leaders take their leadership skills to the next level?
Terry: A growing self-awareness of how they present themselves, maintaining a balanced ego and to have the ability to set high standards that are achievable. A great leader attracts and retains the best people – at the same time preparing them for new assignments inside and outside the business unit.
I strongly believe leaders can benefit from an external coach. I had one as CEO of Erie. Having a “truthteller” and “sounding board” with good questioning skills that has broad perspectives is a key asset for leaders to tap into. If not a professional coach find a board member, senior leader, retired resource that is willing to act in this role. Look for competency not officer title or rank. Look for honesty not affirmation.
Adam: What is the best advice you have on building, managing and leading teams?
Terry: Attract people that are smarter than you and different from you in experience and thought. Let them have the freedom to design the process as long as all understand the end goal and timeline. Always provide the needed resources (no excuses) and provide clarity of mission on a consistent basis. Make sure you are getting timely updates for information gathering and to allow your input to be heard. Remember talent trumps strategy – build, rotate, reward, fix or flip.
Adam: What are your three best tips applicable to entrepreneurs, executives and civic leaders?
Terry: Work your constituents – good leaders are bridge builders not moat keepers. The biggest danger for a leader as they go up the food chain is sanitized information on a delayed basis. Working your relationships at all levels inside and outside the organization stops this from happening – but don’t kill the messenger when you hear news you do not like.
Always be curious – good leaders have an intellectual drive they thrive on. It is driven by personal and professional need. Cultivate this skill in you and others. Use the findings for useful purposes in the company, community, family or your own tool kit.
Provide long term value creation and be open to innovation – the world is more demanding than ever. Customers expect a seamless effective relationship with the companies they choose for products and services. You have no right to this relationship unless you earn it every day. At the same time you need to innovate to meet the needs of the future. Both the old and new economy have examples of missed innovation and an unwillingness to change (Eastman Kodak and Blockbuster are but two examples).
Let me add a fourth – Have fun and let others have fun!! Emotionally enjoyment is a multiplier for everything else. It creates good mental health, team cohesion and a culture that is open and positive!
Adam: What is the single best piece of advice you have ever received?
Terry: From my oldest child when he was about 8 years old. As I was straining to get him to do something he did not want to do he blurted out “You’re not the boss of me!” It taught me the importance of situational leadership, proper tone and body language and the importance of creating a path for success opposed to a transaction that on the surface may seem successful, but underneath is damaging and detrimental!
Adam: What are your hobbies and how have they shaped you as a leader?
Terry: They have provided a great outlet and growing opportunities physically, mentally and emotionally. While all are very different (firefighting, Scuba, woodworking and cooking) all require passion, preparation and professionalism. These pursuits have made me understand the importance of getting away from the corporate inertia and taking time for personal relaxation and self-renewal (something I struggled with as a younger executive/leader). Diversified pursuits make you a more interesting person to colleagues, customers, shareholders and family! It also allows you walk away from the CEO role more easily!
Adam: Is there anything else you would like to share?
Terry: I appreciate the opportunities to share of some of my thoughts with the audience. Leadership is not a destination but a journey with many paths. The growing leader is the one who continues to push themselves into new and unfamiliar areas that will benefit the team and the leader. To quote the famous Chinese philosopher Lao Tsu –
“The wicked leader is he who the people despise.
The good leader is he who the people revere.
The great leader is he who the people say,
“We did ourselves.”