In my last column we reviewed the changing environment in which business leaders now have to operate. Technology-savvy CEOs are increasing in number. However, while their technical skills may have helped get them to the corner office, those skills alone will not ensure success. This month's column discusses some of the skills that increasingly define a successful leader.
Inspiration: CEOs represent the passion and soul of the companies they lead. Increasingly, they will seek to inspire not just their company's workforce, but also their customers and business partners. As Winston Churchill once noted, "I am certainly not one of those who need to be prodded. In fact, if anything, I am the prod." His axiom describes many of today's leaders. For instance, Steve Jobs at Apple, Larry Ellison at Oracle and Phil Knight at Nike are revered more for being "inspirational" and are known less for being "managers."
Coach: The ability to develop talent is perhaps a leader's most lasting legacy. The ultimate challenge, in effect, is to make oneself obsolete. For many leaders, this is the most difficult challenge because it runs counter to many of the attributes that helped get them to the top in the first place. Make no mistake, getting the top job still means outperforming others. Yet, the moment one achieves the ultimate objective, the questions regarding succession commence. Investors, analysts and board members all start to focus on the next generation of leaders. Many companies stumble in the wake of the departure of a successful leader. A great leader is a tough act to follow as Coca-Cola, Apple Computer and Chrysler have all experienced.
Recruiter: Traditionally, CEOs only became involved in recruiting the most senior executives in their companies. In the past, the CEO rarely served as a reason for the best and brightest to join a company. Now, CEOs are often the most powerful draw for ambitious, talented people. The CEO as a chief recruiter is becoming a common occurrence as companies compete for increasingly scarce talent. At Dell Computer Corporation, Michael Dell has been known to place a personal call to candidates outside the executive suite to attract the right talent.
Service Orientation: CEOs are often called upon to be the number one customer-service agent. Lou Gerstner, when taking over as CEO at IBM, made a point of spending much of his time with the company's customers. He believed that IBM had lost touch with its customers and that previous management had become too inwardly focused. He's not alone. There are others who demand the same customer focus. Credit-card giant MBNA, for instance, requires all of its executives to occasionally answer calls in its customer contact center. Home Depot insists that all new executives spend a number of weeks in its stores to understand what serving the customer really means. Each of them understands the value of customer contact at all levels of the organization.
Decision-Maker: Decisiveness is not a new quality for a successful CEO, but it's one that can be increasingly difficult to exhibit in the incredibly volatile world of commerce. Not only are the variables numerous, but the speed with which decisions become widely communicated assures CEOs will not have the luxury of waiting to see how things turn out before acting. Even the smallest decisions are often the subject of debate on the Yahoo! chat boards before they are fully communicated within a company.
Focus: If the CEO is doing her job right, she'll be bombarded by creative and innovative ideas. The trick to managing this process is to maintain the organization's focus while not destroying the creative flow. Often, this is accomplished through a unifying mission or theme that gives meaning to employees' everyday activities, demonstrating how they can contribute to the success of the organization. When these values are established, they can be used as criteria for screening ideas and initiatives to arrive at the best ideas.
Contrarian: Refusing to accept conventional wisdom should be a daily routine for a CEO. It's better to have a CEO challenging the status quo than your competitors or, worse yet, customers. I once reported to a CEO who frequently reminded me that in many cases it is better to be provocative than right, because in doing so he challenged people to prove him wrong. Why? Challenging commonly held beliefs and assumptions forces the champions of those beliefs to clearly articulate why the ideas remain valid and thereby assures their continued relevance.
Change Agent: Change management, like reengineering, has become a business catch phrase in the last few years. Yet, like reengineering, where many people talk about it, few are successful at doing it. In fact, research indicates that as many as 70 percent of reengineering efforts fail to yield expected benefits. Change management is seen as being "soft and fluffy" and therefore is often scorned by superhero-like business executives. However, a new perspective on the role of CEO as a change agent is emerging and can be seen in many successful organizations. It encompasses key elements such as leadership, communication, measurement, accountability, rewards and incentives, organization, skill development and staffing.
Value Generator: Perhaps one of the most radical transformations occurring today is in the measurement and, hence, the drivers of value creation. Traditional measures focus on tangible assets such as stores, plants, inventory and employees. However, many of today's valuations focus more on the intangibles such as intellectual capital, brand equity, innovation, and customer reach and satisfaction items that do not appear on the balance sheet or monthly management report. CEOs who have been schooled largely in the traditional methods of valuation need to adapt rapidly to the new measures and provide clear direction and guidance to ensure that their leadership translates into sustainable returns.
Innovator through Technology: Nearly every CEO is now facing the threat of new competitors gunning for their most profitable segments of business. They're also feeling pressure from board members who are demanding Web-enabled business strategies. In a recent study by Hackett Benchmarking & Research, part of Answerthink, Inc., 93 percent of companies surveyed expect significant change in their business strategies as a result of the emergence of e-business. A CEO who has little appreciation for the threats and opportunities presented by near-continuous technological change lacks the necessary vision for the job. You can now add technology literacy to financial acumen as a fundamental skill that all CEOs must have.
We are at a fascinating time for observing the development of tomorrow's business leaders. Not only are we seeing the demands of the job changing, but we are also seeing increasing diversity of occupants of the corner office. CEOs such as Carly Fiorina at Hewlett-Packard, Ken Chenault at American Express and Jacques Nasser at Ford represent a much more diverse and eclectic group. Ultimately, of course, great leadership is defined by results; and in today's uncertain economic climate, it may take a few years for the real winners to emerge.
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