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  • Writer's pictureMJ

Balancing Responsibilities and Finding Success as a CEO

At the world’s 2000 largest companies, two out of five CEOs feel as though they are struggling after 18 months on the job; 30% are relieved of their duties within three years (Keller 2024). Thus, as these troubling statistics suggest, it is incredibly difficult to be a CEO. So, how do the successful CEOs guide their organizations? McKinsey & Company partners Carolyn Dewar, Scott Keller, and Vikram Malhotra set out to find the skills top executives need to have. They released their findings in a book and series of articles titled “CEO Excellence: The Six Mindsets that Distinguish the Best Leaders from the Rest” released in 2022. As a CEO Advisor and Management Consultant, here are what I found to be the most important takeaways from their research.


The Roles of a CEO

CEO is often a position that comes without direct preparation. While there are a variety of jobs one could have in an organization, none of them truly prepare them to become CEOs. According to Dewar, Keller, and Malhotra, the six roles of a CEO are setting the organization’s direction, aligning the organization to the direction, mobilizing leaders to deliver on that direction, working with the board, connecting with a group of stakeholders, and managing their effectiveness. CEOs have a lot on their plate, and their decisions impact people throughout the organization. With so many people dependent on them, it is no surprise that many CEOs struggle. The success of a CEO is also dependent on them getting each successive step correct. If a CEO picks a poor direction for the organization, then they have little hope of getting leaders to deliver and connect with shareholders. Setting a vision may be the most difficult task for an organization. CEOs have to deliver high-quality work without having references to look to or experiences to fall back on. So, it is easy to see why so many can’t make the transition to the role.


Understanding ‘Why’ 

CEOs have to be able to understand a variety of “whys”. I’ve touched on the first one already; the why of the organization. They have to go deeper than the surface level of why the organization exists. Their organization may make widgets, but the CEO has to get to the greater meaning behind said widgets. Perhaps their widgets lead to great efficiency and higher-quality production. That’s up to the CEO to understand. Next up is understanding the “why” of a problem. Keller uses an excellent example of an overheating machine. At the outset, the issue is that the machine is overheating. But in reality, the problem is that there is not enough ventilation in the factory. While an oversimplification, the example explains the predicament CEOs face. First, it is incredibly easy to fall into the trap of believing your first assumption is correct. If you believe you have a solution to the problem, you are unlikely to dig deeper and find the root of the issue. Second, CEOs have to go through this process with far more convoluted issues. A CEO may encounter inquiries about decreases in productivity, decreasing revenue, and regulatory issues coming across their desk in a single day. Finding the root of the problem can be incredibly time-consuming, but CEOs don’t have the luxury of taking as long as they need. CEOs have to be decisive and accurate. So, having a knack for problem-finding is key.


CEOs also need to understand the “why” of a bevy of different people. From board members to managers, to clients, CEOs have to manage the expectations of a variety of different people. Having empathy and being able to understand another person’s mindset is a necessary skill for CEOs. While this is an area where CEOs can “practice” before gaining the role, they will never have to account for so many different perspectives in other positions. Empathy is particularly important in the age of stakeholder management. CEOs are constantly under a microscope and need to understand how their actions will be perceived by their stakeholders. CEOs can’t please everyone, but finding the solution that will benefit the most amount of people is crucial. Understanding is a skill CEOs either have or don’t have and is vital to their success in the role.


Start Strong

As I’ve alluded to, it is impossible to truly prepare to be a CEO. Virtually every other position on the corporate ladder reports to one boss. You are accountable to a much smaller number of people. And, in many cases, there are avenues where you can deflect blame or responsibility. This simply isn’t the case as a CEO. When you reach the top, everyone is looking at you. The board, remaining executives, and even lower-level employees scrutinize much of what you do. Therefore, acknowledging that it will be a challenge to get going will make your transition much easier.


While it's important to know that you will make mistakes, it is also key to nail your first year or so on the job. This is particularly true for the 100-day “honeymoon” period you will receive. Your first bit of time as CEO is all about building trust within the organization. Understanding that the jobs and security of potentially thousands of people are somewhat in your hands can be intimidating, but necessary. While becoming CEO is a major personal achievement, realizing that you are in the role of helping other people is the first thing a CEO needs to realize. From there, listening to the needs of your employees and customers will pave the way for success. Issues left by your predecessor will need to be addressed. Taking decisive and beneficial action early on will inspire confidence in you. People want leaders who get things done. Making a big first impression will garner trust, and prepare the organization for an upward trajectory. Once you have your employees bought in, it's all about tackling the most impactful issues. Cashing in on early support, and continuing to push your organization forward, will set you up to maintain your role into the future.


Don’t Get Complacent

Climbing the mountain to become a successful CEO is the hardest thing to do in business. So, for those who do make it to the top, it is quite easy to fall into the trap of always doing what has worked. Put simply, companies cannot afford for that to happen. In a world that is constantly changing, and full of competitors gunning for you, leaders constantly have to adjust and improve their leadership style. The trio defined four main strategies for CEOs to avoid complacency, being enhancing your learning agenda, taking an outsider’s perspective, collaboratively defining the next S-curve, and future-proofing the organization.

When CEOs become successful, many people want to learn what got them to where they are. While it is great to share the wisdom you have, continuing to gain insights and grow is the real key to success. Seeking outside opinions, evaluating competition, and gaining insights from customers is a great use of a CEO's time. As soon as you think you know what you need to know, a major market change occurs, and you get left in the dust. So, continuing to reach out and grow should be a point of emphasis.


Understanding your customer’s needs and experience is also key for a CEO. Companies constantly need to ensure they are delivering on their value proposition. They also need to understand the routes they can take to convince customers to purchase more of their product. Special promotions and marketing tactics are prime examples of understanding what motivates your customers. Keeping tabs on what they are looking for, and what drives them to certain purchases is key for your business. Thinking like an outsider can also mean taking actions that a new hire would take. An interesting thought exercise, proposed by former Intel President Andy Grove, is what a new CEO would do to improve the company if you were fired. If a new CEO would do something differently, why wouldn’t you change course? Thinking about potential changes in strategy can be very useful.


Change is difficult to enforce; particularly in large organizations. Creating an “S-Curve” by which change is gradually introduced while producing large dividends is quite useful. Slowly implementing new policy will allow employees to get on board, while you still get the large results you were anticipating. These S-Curves tend to be in three to five-year increments, depending on the direction of the business. Keeping a pulse on your trajectory, and changing course when necessary, is a key role of the CEO.


Finally, CEOs need to be able to lead their organizations through times of #crisis. You never know when a crisis will pop up, or what it will be. Those who fail to prepare often go from being held in high regard, to finding their way out the door. Preparing for the variety of issues you can be confronted with will maximize the CEO's leadership when these situations arise. The organization will also have an increased sense of self-awareness when they think through what could go wrong. While it is important to not dwell on potential issues for too long, preparing for the future is a worthwhile use of a CEO's time.


These are just a few of the seemingly limitless responsibilities a CEO is faced with. The amount of pressure and difficulty preparing for the position leaves many unable to adjust to the role. However, if CEOs can properly game plan before taking the job, they can drastically increase their chances of success.


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