Businesses must be able to learn and adapt faster than the rate of change in the respective markets. This is especially critical in times of economic, regulatory and business uncertainty.
Business and climate uncertainty increases the pressure on leaders to spend their time in the business, addressing the day to day activities that drive today’s performance and ROI results. These typical issues make tasking difficult and a balance to find sufficient headroom time on the business, considering how a leader must approach solutions to drive sustainable change and growth.
Sustaining growth and value in a company comes from making the right strategic choices and then aligning the business model and operational performance, stakeholder requirements and risk management to those choices.
It will take a good leader and his team careful consideration whilst considering the components of value creation and the important priorities in the short, medium and long term as spending time in the driving of the day to day performance of the business.
Being the CEO of a large company is like being the President of a small country. Effective CEO’s have mastered the delicate balance of leadership, hard work and innovation.
Many people set their sights on becoming a CEO from a young age, but what does that journey look like?
What should future CEOs prepare themselves for along the way to becoming a CEO?
On the CEO journey, there is quite a grooming process that most CEOs have experienced before they finally achieved that position. The road is generally both pressurized and tough and certainly not for the timid as well as respected.
The more traditional route is illustrated below, It’s called Keys To The Corner Office, and it was created by CEO.com. It breaks down the process of becoming a CEO into 3 steps which include education, experience and grooming. It’s interesting to note that the average age of a CEO at the time of appointment is 50 years old, and that’s of course after years and years of preparation, experience and working up through the ranks. If you take the non-traditional route to becoming a CEO which we already mentioned, you’ll get there a lot faster, but there is more risk involved. As always, there are pros and cons to both. You just have to decide which is best for you.
What To Expect On Your Journey To Becoming A CEO
Another key point for the CEO journey is organisational risk. Organisational risk is now on the radar of top executives, and it’s the CEOs – not Chief Risk Officers – who should ultimately bear the responsibility for risk management.
Organisational risk is generally broken down into three types of risk. First are the preventable risks. Examples are the risks from employees’ and managers’ unauthorised, illegal, unethical, incorrect, or inappropriate actions and the risks from breakdowns in routine operational processes.
Then there are the strategy risks. A company voluntarily accepts some risk to generate superior returns from its strategy. A bank assumes credit risk, for example, when it lends money; many companies take on risks through their research and development activities. Strategy risks are quite different from preventable risks because they are not inherently undesirable. And finally, there are the external risks which arise from events outside the company and are beyond its influence or control. Sources of these risks include natural and political disasters and major macroeconomic shifts.
External risks require yet another approach. Because companies cannot prevent such events from occurring, their management must focus on the identification (they tend to be obvious in hindsight) and mitigation of their impact.
An interesting report Exploring Strategic Risk, a global risk survey released by Deloitte Touche Tohmatsu Limited (DTTL), reflects the views of mainly C-level executives, board members and risk executives from the Americas; Europe, Middle East and Africa (EMEA); and Asia Pacific regions, state; two-thirds (67%) of more than 300 executives surveyed on strategic risk management practices say the CEO, board or board risk committee has oversight over strategic risk at their organisations.
Finally, to cultivate a successful CEO journey is to create shareholder wealth in our turbulent economy, CEO’s within companies need to spend as much time on building and executing strategies as on operating issues. Those that do will build skills and generate strategic ideas that evolve over time. Rather than fear uncertainty and unfamiliarity, these strategic CEO’s can embrace them, and make the passage of time an ally against competitors that hold back when the future seems dark.
A famous quote once stated “ The hills we climb today are only foothills, compared to the mountains that we will climb tomorrow.”