There are generally two big incremental steps in the career trajectory of CEO aspirants. The first step is often a move from a divisional general management role (or functional head role) to a country head appointment. The second big step is heading up a fully autonomous listed company, accountable to a Board representing shareholders. Those making these selection decisions need to consider internal versus external candidates, and the built experience of each pool of contenders.
The “height” of each of these steps is often underestimated by contenders. The knowledge and capability required for moving up to a general management role addressing operations, people management, marketing, finance, and a full P&L is one big leap to consider. The move to a fully autonomous CEO role (with shareholders and a board) is another very large step upwards again.
Then, there are the new challenges facing CEOs in emerging commercial and non-commercial environments, which increase the complexity of the role, and which also impact on the type of leadership required for the future. These challenges include the impact of the Internet, social media, new regulatory and governance requirements, changes in our geopolitical contexts, and the nature of competition internationally.
In our work with CEOs and CEO aspirants, it is important to test experience and to create the best way to explore what prospective CEO roles really require.
A tool that Trevor-Roberts have developed for this purpose involves the articulation of seven fields of experience and capability that will assist to increase an individuals chances of being appointed as CEO. These are drawn from an extensive study of CEO competencies at The University of Queensland. Here we have listed three of these:
1. Development of strategy
- The ability to build a roadmap, providing a focus for both short- and medium-term activity - albeit with continuing agility and flexibility - should change become necessary
- A proven track record in strategy execution (often more important than strategy formulation): “An imperfect strategy well-executed is often more important in building shareholder value than a perfect strategy poorly executed.”
Consciously uses ethical framework in decision making
Builds mutual trust and respect with all stakeholders
Is transparent and authentic in style and sets the tone for other leaders and the rest of the organisation
- Effective management of the balance sheet and the P&L, short- and long-term
- Solid understanding of tax, treasury, statutory reporting, governance, debt, capital raising, management accounting and key profit drivers
- Understand key risks and processes for effective enterprise risk management
Additional useful capabilities
Running across all of these broad sets of capabilities, we are increasingly seeing a need for another set of “meta-capabilities”. These include:
- Decisiveness: in relation to people, business strategy and the direction of business investment and dis-investment.
- Compassion and care: we have seen recent examples where inappropriate leadership behavior has led to abrupt CEO contract termination.
- Comms management: The ability to manage communications across fast-moving information channels including social media (social media can magnify and distort popular truths and short-circuit logic and more considered responses)
- Creativity: particularly in addressing business transformation opportunities emerging through technology.
Successful CEOs must also have that rather exceptional mix of both self-assurance and humility—an ability to generate confidence in those they lead, and the wisdom to seek advice when it is needed.
CEOs who will be successful in any given appointment are very hard to find. Both contenders and those making selection decisions need to carefully unpack exactly what an appointment really requires before charging into courtships. They will then need to successfully navigate the selection process to ensure that the resulting appointment is the best fit on both ends.
At Trevor-Roberts we provide coaching for CEOs and CEO aspirants who want to become senior leaders and prepare for their next appointment. This work involves careful appraisal and expression of capabilities in the individuals we support, and then building a clear focus on what is needed for the appointment. Needless to say, this work is a little more involved than providing interview tips.
For more information on how we can assist, contact us on 1300 876 118.