Boards and owners are increasingly expressing dissatisfaction with the CEO they have appointed. In the past 15 years, nearly 25% of Fortune 500 CEO departures have been involuntary. The Skillsets frequently identified as being desired relate to a “more Strategic CEO.” What are those Skillsets, and how can they be developed?
1.) Ability to enable others to participate into looking at the future of the firm:
While it is not possible to predict the future with perfect accuracy, the inclusion of a group of experts from diverse backgrounds improve the quality and accuracy of identification of future trends and resulting impacts on the organization. The challenge is in choosing the best mix of participants and engaging them to look at how the future will unfold. Strategic CEOs understand how not only to build the team and also how to inspire and encourage diverse viewpoints to challenge the group to explain the future and how the corporation can respond to it.
2.) Distillation of the vision up and down throughout the organization:
A Strategic CEO can communicate effectively this vision up to the board for feedback and adjustments and throughout the organization to the front lines, customers, suppliers, and adjacent stakeholders. This process of “distillation” ensures the Strategy is adapted to different needs and retaining relevancy while incorporating the feedback necessary for success of the firm in fast changing technologies and markets.
3.) Identification of Risks:
The range of risks organizations face are increasingly complex and include both internal and external forces which challenge the survival and profitability of the firm and business units. The Strategic CEO is involved in both the identification and protection from risks and moving towards the next big leap ensuring minimization of obsolescence.
4.) Humility:
At a discussion last week an expert investment advisor raised an excellent point: “When I see a CEO on the cover of a major business magazine, I know it is time to the short the stock”. The Strategic CEO is a leader and also a team member incorporating the judgment and feedback of the board, in many cases the owners, the customers, executives, and external advisors to make the best possible decisions for the future. Success over time requires a strong dose of Humility and the difficult ability to admit at any moment in time that previous decisions were wrong and course correction required quickly.
The volatility in global markets today is increasing, and the most successful CEOs are assisting in the capture of the value from volatility by encouraging inclusion from diverse sources, instilling ownership in the future looking strategy, minimizing particularly the risks regarding the future, while maintaining the humility necessary to admit “I was wrong.”
