Qualities of a CEO

Qualities of a CEO

CEOs are often associated with large, publicly-held companies. However, every business and not-for-profit organization [NFP] has a CEO, although they do not always have that title. The CEO is the person at the top that is ultimately responsible for the execution of the organization. Here are some of the qualities the CEO needs. Some of these qualities are organizational rather than personal but an effective CEO needs to establish, oversee and preside over all of these regardless of who is responsible on a day-to-day basis.

• Oversight, maintenance and “ownership” of the business model – Being clear about the organization’s mission and purpose and keeping it on tract to attain those purposes
• Strategic initiatives – Making sure the organization doesn’t remain stagnant and stuck in a rut
• Visionary ideas for future – Searching for ways to break out of the present mode and to match them with what is achievable without disturbing the present model
• Close eye on financial performance – Not just daily key performance indicators [KPIs] and current profit and loss, but cash flow, adequacy of capital for current infrastructure and expansion and growth, banking relationships and credit lines and loan covenants, and the balance sheet. Actual results should be compared to budgets and projections and variances explained
• Leadership – You cannot be a leader without people following you. The CEO needs personal influence, integrity, mentorship qualities, a strong work ethic, unbreakable ethics, and the ability to create teams, obtain a consensus and bring people together
• Personnel management – Staff people and team members need to be treated individually assigning, mentoring, training and nurturing each so they maximize their strengths while being shielded from activities they do not perform well so overall the organization functions with people working great at each level
• Organizational agility – The CEO needs to create an atmosphere of personnel empowerment without the fear of people being blasted for mistakes and errors of judgment [if it occurs too often then there needs to be a re-evaluation of that person]. Included here is a culture of seeking out and a quick evaluation of innovation along with the ability to adopt and adapt quickly to new processes
• Customer centricity – it is always about the customer and their satisfaction. The CEO should never lose sight of this. This is what causes the revenues to flow in
• Products sold – The products and services delivered need to have consistent quality delivered with a reliability that makes the organization a preferred source, regardless of the pricing
• Competitive pressures – The competition needs to be scrutinized looking for changes they make and also for disruptive actions by those not presently considered to be competitors
• Brand and culture management – The CEO is the CCL [Chief Cheer Leader] and needs to lead the organization’s branding and culture. The CEO also needs to oversee the publicity, public relations actions and marketing social media claims and direction and to make sure they are coordinated and on target with the overall mission of the organization. It is the CEO;s responsibility to assure that everyone in the organization adheres to the branding message and company culture
• Risk management – Protocols need to be put in place to assure that unnecessary or excessive risks are not occurring. The CEO needs a direct line to those entrusted with this responsibility. Once the processes are in place there needs to be a no short cut policy
• A strong system – Every organization has a system though not necessarily a good one. It is the charge of the CEO to make sure the system is strong, facilitates the operations in an effective and efficient manner, is alert to reacting and eliminating bottlenecks, is easy to train, learn and follow and has the right checklists so the goals of the organization will be accomplished with as low cost as possible
• Project management – Resources need to be properly and timely allocated with the right people assigned to what they do best. Due dates need to be communicated and closely monitored with the CEO able to receive updates as one of the daily KPIs.
• Inventory management – This fits under project and financial management and a strong system, but also includes the flow of work, not letting unfinished projects get stale or have financial and/or space resources tied up in nonproductive or under-performing inventory
• Supply chain – The CEO needs assurances of the continued viability of the supply chain if a product based organization or continuing flow of the right type of personnel if a service based organization. The daily departmental activities can be delegated but the overall responsibility is the CEOs
• Invest in future – An effective CEO needs a willingness to invest in the future. This means committing resources to and following through on thoughtfully planned projects
• Buy-in – While in many situations the CEO is a “dictator,” serious buy-in is needed from every stakeholder. Just because the boss tells someone to do something doesn’t mean it will get done. In some respect, each person working in an organization is their own boss deciding what they will do and when based on their sense of priorities and what they believe is important. An effective leader gets buy-in to the advantage of the organization and its systems and processes
• Change agent– Businesses are not concrete structures devoid of the need for alteration, change or growth. Many times the genesis for change comes from factors outside the organization or industry. The CEO needs to be a change agent using inquisitiveness and a wandering eye for what’s new or outside the box taking ideas from other sources. This can be easily accomplished by trend-searching which can be done by perusing best-selling and business book sections in book stores and the extensive magazines for sale there. Noticing a crop of magazines on a specific and new topic can alert anyone with an open mind that perhaps a trend has or is developing. Most may not be applicable, but I can assure you from personal experience that I spotted many nascent trends from paying attention to a growing volume of magazines or lead stories from quick browses at magazine racks
• MBWA – You cannot learn what is going on sitting in your office. An effective CEO needs to Manage by Wandering Around. See what your people are doing in their offices, production floors and shipping areas. Visit key customers and suppliers – some can be impromptu when you are just passing by after another visit is the area. GOYA – Get Off Your Ass!
• Ability to listen – No one knows everything and even if someone is brilliant in some areas, it doesn’t mean that they cannot learn from others. Listening is a little used trait. Listen, pay attention and elicit comments, and especially complaints. That is how the CEO will learn
• Transparency – Working in secrecy does not work, unless it is a top secret new project and then discretion is needed not to alarm people that find out through leaks. Openness is important, allays fears, thwarts and stifles rumors, and creates trust and security in the leadership and organization
• Respect for the Board – In larger organizations while CEOs are the boss, they answer to a Board of Directors who determine the overall policies. For many smaller and almost all entrepreneurial businesses this is not the case and the CEO also wears the hat of the Chairman of the Board. As such, it is suggested that the CEO have a quarterly “Board” meeting where they present a report and summary of the company’s activities. This “forces” the CEO to take a step back and reflect and account for their actions and company performance. Invited to the meeting could be outsiders such as key personnel, the company’s attorney, accountant, business coach or other advisors whose judgment and opinion they respect. Note that this entire process including the preparation can take about a day – I think this is a valuable way for the CEO/Owner to spend their time, even if the only person at the meeting is the CEO. It brings a reflected look to someone that doesn’t really feel they need to answer to anyone

The CEO is the boss and the head person in an organization. It is usually not an honorary position, but one that carries a great responsibility to maintain the organization’s viability on a current as well as continuing and sustainable basis. If you are a CEO or if you oversee or are hiring a CEO, review these quality features and determine which of these are applicable to you or your organization.