The CEO has a difficult job because he is the leader of the organization. He is responsible for employee motivation and the strategic promotion of the company. In addition to the fact that he needs to make decisions and show business results, he also has to shape the conditions and culture of the company, because employees are the biggest asset of the organization. And it is important to establish good relations with them.
There is no universally accepted system that would measure the effectiveness of the CEO because the goals and objectives of each CEO are different.
1. Ability to anticipate.
Anticipating results in a changing environment is one of the hallmarks of a leader. Society is changing so fast that it is impossible to say exactly what will happen in the next five years. But the CEO is in charge of strategic development and needs to look ahead to make plans. Therefore, they choose leaders who can thrive in the unknown and are comfortable with change.
How to develop insight?
- Stay up to date. Changes in legislation, the emergence of new technologies and tools, and the entry of new companies into the market — the CEO needs to know about all this in order to promptly make changes to existing plans and strategies.
- Weigh all the pros and cons. Changes in one process can set off a chain reaction, and pull changes in others. Therefore, it is important to evaluate decisions from all sides: how they will affect employees, the company, and current processes. What will be the turning point, what will reduce efficiency, and what barriers will have to be faced?
- Think outside the box. Learn to accept even the most non-standard ideas — think about what they can be turned into, and how to refine them. Brainstorm with the team to come up with new solutions.
2. Ability to take responsibility for the team.
The leader is responsible for completing tasks and achieving goals. This function of management was formulated by Henri Fayol, one of the outstanding managers of the last century and the founder of the classical school of management: “To manage means to predict and plan, organize, lead a team, coordinate and control.” The definition is still relevant, although approaches to managing a company, personnel, and setting goals and objectives are changing. Still, the CEO does not have much time to take on the responsibility of other employees and top management of the company. For example, the staff of our company is more than 600 people. The CEO should invest in where his participation will be most useful and necessary.
In companies, continuous performance management (CPM) is becoming popular instead of annual or biennial evaluation. The bottom line is that each division is given short-term goals as part of the CPM, which are based on the company’s strategy. And every week the CEO meets with management to discuss the work. Most often, these are informal meetings for 10–15 minutes, thanks to which the management can convey the position of employees and promptly discuss current tasks.
How to motivate employees?
- Invest in training and development. Today, L&D is one of the top priorities for employees. New knowledge and tools help to complete tasks faster, optimize processes and move the company forward. In addition, L&D helps reduce employee turnover and save money in the long run. In our company, we regularly hold internal conferences, and webinars and maintain an LMS platform with a knowledge base.
- Allow for independence and creativity. Autonomy improves employee morale and productivity and teaches responsibility. When I allowed subordinates to make and correct mistakes, their productivity increased markedly.
- Create a pleasant working environment. A person spends one-third of his day at work. Even if employees are away, help to spend this time as pleasantly as possible. For example, fine-tune workflows, provide tools for comfortable communication, and celebrate successes.
3. Ability to change.
Companies that do not keep up with change risk being left behind. Therefore, its leaders need to learn to adapt. The ability to absorb information, experiment, fail, and innovate will be critical to the CEO and his team. New competitors can appear out of nowhere at the most unexpected moments, so you can’t relax and think that the same strategy will work this year as last year. But this makes doing business dynamic and interesting — you don’t get bored.
The professor of information systems at the Carroll School of Management at Boston College conducted a study in 2018 for which he interviewed more than 4,300 executives around the world. In an article for the MIT Sloan Management Review, he outlined four main conditions that executives expect from digital leaders:
- Provide vision and purpose.
- Create conditions for experiments.
- Give people the opportunity to think differently.
- Ensure barrier-free cooperation.
This is what the CEO should strive for as a transformation leader in the company.
4. Ability to establish trusting communications.
Communication is a catalyst for change and positive business results. Today it is not enough for the CEO to send out emails written by the PR department. Employees want transparency and credibility.
For example, Whirlpool Corporation CEO and Chairman Mark Bitzer regularly answer employee questions via live streams on the corporate platform. I also regularly talk to employees and periodically go to sales offices.
How to make communication effective and trusting?
- Choose the best time for important conversations. For example, you should not assign one-to-one for Monday morning or Friday evening.
- Use the exact words to express your expectations, plans, or concerns. If the company is in a crisis, then this should be clearly stated and a plan of action should be shared. Because otherwise, employees can come up with bad things, including expecting layoffs.
- Listen to others because communication is a two-way process. Ask them to tell you how things are going in the departments, what customers say, what the employees themselves want.
5. Ability to work in a team.
Power is often associated with complete independence and autonomy. It seems that the leaders know everything, look down on everyone and make decisions on their own. But in reality, a competent CEO will not allow himself this, because there are a huge number of people whose help and knowledge are needed to make the right strategic and personnel decisions. Business is a team sport.
I do not coordinate each construction project individually, because I am not an architect. My task is to find great specialists who understand architecture, understand the market and know construction standards. And only then, with the help of managerial skills, do I get the most out of these talents.
How to get the most out of teamwork?
- Respect the team. If you hold the position of CEO, this does not mean that the rest of the top managers are somehow worse. But each team member plays an important role in the development of the company, and his skills and knowledge help make the right decisions.
- Increase efficiency. Team evaluation is valuable because it helps optimize performance and find problems at the very beginning. What are the barriers for leaders? Where to focus your efforts? Is the team realizing its full potential?