The role of a CEO

What does a CEO do?

 

A CEO clarifies and agrees a business’s goals with its shareholders or stakeholders and provides vision and leadership to help achieve those goals.

Understanding the business

A CEO needs to first build an understanding of:

  • The business
  • Its market
  • Its internal business model
  • The key drivers of business success.

From that they should present the realistic strategic options for the business to shareholders and other stakeholders, and from that agree the strategic goals for the company, including a business plan, and fiscal targets with the board as representatives of the shareholders.

Structuring the business

Once the business strategy is agreed, the CEO is responsible for structuring the business to ensure the correct resources, authority and responsibility are assigned correctly to focus on the key success drivers, from the business plan. This includes the size and structure of personnel, targets for each department, and a fiscal budget.

Implementing the strategy

The CEO is then responsible for ensuring this plan is successfully implemented, which requires an understanding of how the business plan is progressing in reality. This can be achieved by regularly reviewing each part of the business against its plan and targets, and it allows the plan to be updated and potential issues to be identified and dealt with early.

Making the right decisions

Within the agreeing of a strategy with the board, building a business plan, and implementing that plan, the CEO is required to ultimately demonstrate good commercial judgment. Every question has multiple answers and a CEO needs the judgment and courage to make the difficult decisions.

Providing leadership

The CEO is responsible for providing leadership within the company, including clearly articulating the vision for the direction in which the company is going. This enables all parts of the organization to understand that direction, buy into it, and manage their actions towards the company goals.

Delivering success

Once the main strategic parts of the CEO role are in place, a good CEO will work with key staff to help them succeed through assistance and mentoring.

Beyond that there is a responsibility that falls on the CEO to set standards by which the company is run. A CEO sets these through their example, their action, and their managerial style. A company and the way it deals with its staff and customers is very much a reflection of the CEO, and a CEO who sets high standards in their behavior will tend to drive those standards across the company.

Find out about my structured approach to the role of an Interim CEO.

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"Mark is a visionary CEO with great attention to detail. He is a person you would want as a boss. He is extremely confident, chooses his people wisely and allows them to perform without micromanaging and getting in the way. His proven ability to grow an organization would make Mark a very strong candidate for any senior management position. September 10, 2009."

Ross Huguet, CEO, Go 2 Productions Inc

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