Vistage/TEC speaker Larry King has gone down in management lore as one of the most knowledgeable experts on the subject of characteristics of great CEOs.
The No. 1 attribute, he says, is the ability to focus. After 36 years of watching top performing CEOs in Wisconsin and Michigan, I concur. Focus is really an issue of clarity of purpose and clarity of action.
Here are six areas in which to measure the CEO’s ability to focus.
1. As a strategist
It’s no longer true that the CEO must be the sole visionary in the business. As a matter of practical truth, very few CEOs have the capacity to be visionaries.
Being a strategist is something different. It involves team-centered strategic planning. The CEO’s function is to be the chief strategist and oversee the strategic planning process, preferably with the help of a qualified facilitator. Typically, it’s at an offsite annual meeting of two-and-a-half days, followed by quarterly half-day planning implementation reviews.
The key issue: Where will we be three years from now in terms of our products, services, markets and competitive position? Most importantly: Where will our future profit margins come from?
2. As an ambassador
Your most important customers should see you in person at least once or twice a year, not in a business environment, but over lunch or dinner. The most important question you can ask is: Where do you see your business going over the next three years and what major challenges will you face?
Your job is to listen very carefully. Where will your firm contribute to your customer’s success?
3. As an inventor
Think of this concept as a diagnostic procedure. The principle involved is to find your customers’ pain, and then find a way to relieve it. Open, frequent and candid communication, as well as an alert sales force, ensures a good diagnosis.
Identifying customer pain is the first step. The second step is to adjust your product or service offerings to respond to it so that you gain an immediate competitive advantage. Customer responsiveness is not a new concept. Anticipating and responding to customer need beforehand requires a different level and intensity of CEO leadership.
4. As a coach
The concept of coaching as a CEO is not new. But once again, the area of focus comes to the forefront. In most businesses, a CEO’s direct reports overestimate company performance from an overall financial perspective.
As CEO, your task is to put your firm’s financial performance in a big picture strategy model. How do the numbers support your strategic planning initiatives? What sacrifices are you making, and which ones would you be willing to make, to accomplish your strategic objectives? How do your key reports fit into this financial model? How can you coach them to better improve their understanding?
5. As an investor
Whether you as CEO are the sole owner or a partner in your business, your major responsibility is to treat your company as an investment and to make decisions that add stakeholder value by virtue of your results. Making short-term decisions to increase market value is the easy way out. Making long-term decisions to guarantee future market value is the characteristic of the truly focused CEO.
It’s unfortunate that in spite of all of the commentary otherwise, many CEOs of publicly traded businesses just don’t get the message. The recent debacle in the financial industry is testimony to this point.
The exception would be credit unions. Perhaps their risk orientation, commitment to long-term results, and support of their stakeholders allows the CEO the focus needed to meet long-term value improvement objectives.
6. As a student
CEO members of TEC subscribe to the notion of lifelong learning. The sources are many and varied, from formal advanced education commitments to ongoing continuing education. Regardless of the source, the focused CEO knows that he or she must stay current, cannot function in a vacuum, and must be open to personal change.
What is true in the new economy wasn’t recognized 10 years ago. Many businesses continue to thrive, not just survive. CEOs remain the drivers of business competence and success. Remaining the student ensures against professional obsolescence.
Are you up to the task?
Larry King’s experience over the past 40 years as a CEO coach has led him to conclude that a focused CEO can perform this role in as little as 20 to 25 hours a week! He says the key is having a top-notch operations team in place, with no toleration for mediocre performance. This frees up the CEO to stay focused on the six roles described above.
He concludes with these recommendations:
“Whose job is it anyway?” Don’t get sucked into doing the work that you’re paying others to do.
“A” priority list. Each month develop a list of the six focus items you need to do for the month. Don’t get distracted.
Personal mission statement. Write down who you are as a CEO and where you want to go. Share it.
Your success profile. Develop a one-page summary of what will constitute success for you. Revise it every quarter.
Until next month, let these CEO success guidelines be focused guidelines for you.
