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The CEO Whisperer

Part 2: Two-time Life Sciences CEO Challenges Aspiring Leaders to Rethink Success

Bonney Part 2

This week, we continue our interview with Mike Bonney. As former CEO and Director of Cubist Pharmaceuticals culminating in the company’s acquisition by Merck for $9.4 billion, Mr. Bonney divides his time serving as board chair or board member of numerous biopharma companies and top academic institutions, giving a tremendous amount back to the greater community, as well as advising the next generation of leaders.

Beth Ehrgott, head of The Alexander Group’s Global Life Sciences Practice, recently spoke with Mr. Bonney about his experience as CEO and how he guides aspiring CEOs:

Why are you passionate about counseling the next generation of leaders?

My top professional goal is to advance the biopharmaceuticals industry. As an industry, we are poised on the greatest explosion of understanding—actually, I would argue that we're maybe five or 10 years into the greatest explosion of understanding of human biology, in human history. We have a broader set of tools to intervene in and influence that biology than we've ever had. We're entering a golden period of understanding human health and learning how to manage it optimally. Companies are hugely influenced by the leader and the industry is hugely influenced by the companies. I want to help create a group of leaders in the biopharmaceuticals industry who can navigate the demands of our investors and provide opportunities for patients in a way that is sustainable for this inherently high-risk, innovative sector.

I am motivated to influence the industry in a positive direction so we don’t find ourselves right on the verge of understanding this incredibly complex biology and not able to raise the capital or have the societal understanding to execute on improving the human condition.

How do you strike the right balance between being a successful capitalist and leading for good (a.k.a., not just delivering a profitable return for shareholders)?

Generating a reasonable return for investors (relative to other risk-adjusted return opportunities they might have) is a condition of being able to continue to be in business and continue to have the impact the business could have. It's not why I get out of bed every morning; it is not what permeates my thinking. But it is always in the background. One of the filters I would use to assess new corporate activities was whether it enhanced our ability to deliver shareholder returns. If the answer was no, those things I wouldn't do. But we often did things that went beyond generating a return because I thought it was the responsibility of the business, and would be helpful in attracting and retaining an extraordinary group of employees.

Charting a path that is both good for investors and society so that your employees are proud of their company is one of the great joys and complexities of the CEO role.

The bottom line is, you can't ignore the need to keep a compelling story forefront, and you need to execute in a way that creates value that allows you to continue to execute. At the same time, if you define your role only as generating return for your shareholders, you run the risk of making decisions that are not in the best interest of society and that disaffects your employees. You'll compromise your ability to actually have the impact that is possible to have in this role.

Charting a path that is both good for investors and society so that your employees are proud of their company is one of the great joys and complexities of the CEO role.

What are the three top pieces of advice you give to an aspiring CEO?

First, know what you're signing up for. If you don't think the mission of the company is worth 100% of your attention, either you're not ready, or it's the wrong role.

Second, find the sweet spot between the confidence to make the decisions a CEO has to make, and the humility to know that you're not always going to be right. Invite others into the decision-making process whenever you can. Find someone who might have the experience, skills or perspective to challenge the way you're thinking about it.

You can’t create an appropriate vision, rally the troops and re-instill confidence—and then execute against that amended vision—if you're always working on the ragged edge.

Third, you have to take care of yourself. Many of the CEOs I admire most believe in the servant leadership model. And I do as well. But having lived through multiple circumstances where I had to lift the organization when it felt like the world was stacked against us taught me the value of always having some reserve. It's easy to be a CEO when everything's going great. The greatest CEOs distinguish themselves when things aren't going great. You can’t create an appropriate vision, rally the troops and re-instill confidence—and then execute against that amended vision—if you're always working on the ragged edge. This is much harder to do. You have to find ways to marshal your energy so you always have one more gear to go to when one is required.

As a CEO, how do you recharge your batteries when you’re working 24/7?

You have to be very clear about how you recharge your batteries. I recharge by being by myself, for example. As I became more experienced as a CEO, I made more time for those alone moments; I would be strategic about it. If I knew something was coming up that was going to be emotionally taxing, I tried to find time to do things by myself, whether that was sailing or fishing or mountain biking.

My board also encouraged me to provide employees with the flexibility to work from home, and asked me to lead by example. I resisted this for quite some time, but found that when I started complying with their recommendation, it did two things: One, it gave me more time to manage my own energy. I'm an introvert and working from home reduced the parade of executives and employees coming through my door. Being absent from the office forced executives to think things through and make their own decision, or find allies within their peer group who could provide a different perspective. It actually strengthened the team because they became less reliant on me to solve all the tactical day-to-day stuff and more reliant on each other.

That said, 80 percent of what walks through a CEO’s door is a problem that the rest of the organization can't figure out, and it takes a lot of energy to engage on it. By working remotely with greater frequency, I was able to devote more time and energy to those things that a CEO has to think through, such as, how's the strategy likely to unfold? What are the environmental issues that we're assuming will exist three to five years out? What's the range of outcomes that might exist in the external environment? Does the strategy have robustness against that range?

By disciplining myself not to be in the office every day, I had the opportunity to allocate a greater percentage of my energy to those inherently internal, intellectual exercises. If one of the outcomes I’d considered did unfold, I’d already thought through the next two to three moves and was positioned to direct the organization at a time when you don't often have the luxury of being contemplative.

What makes a great leader?

Self-awareness is critical. And the combination of self-awareness and authenticity in how you lead is critical, both for the aspiring and for the incumbent CEO. Always act with intentionality—you don’t have the luxury of not!

How you make decisions is also an important success factor. As a CEO, you're presented with the opportunity to make lots of decisions. Many are presented with what I would characterize as a false sense of urgency or a false sense of impact. You can make 15 decisions a day as a CEO, but what I found during my tenure as CEO is that many decisions don't have to be made when the organization thinks they have to be made. Developing a level of intentionality on all of your behavior, including not being pushed into premature decision making, is a key aspect of being a successful CEO. The ability to step back and really question—what would we do differently if I made this decision today versus next week or next month?—is an important skill.

The final thing I'll say is this: Most of the decisions you make as a CEO don't really matter that much. The catch is that you don’t know which matter and which don’t, until reviewed in hindsight. As a result, having an intentional, thoughtful and appropriately paced decision-making process within your firm becomes a key differentiator between the good CEOs and great CEOs.

If you missed Part 1 of this series, read it here.

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Beth Ehrgott

Beth Ehrgott

Managing Director