Magazine article New Zealand Management

The CEO's Checklist: What You Should Know before Signing Up for the Job: Becoming an Effective and Enduring CEO Is All about Ensuring the Right Match between CEO Skills, Abilities, Experience and Latent Talents, and a Myriad of Organisational Details

Magazine article New Zealand Management

The CEO's Checklist: What You Should Know before Signing Up for the Job: Becoming an Effective and Enduring CEO Is All about Ensuring the Right Match between CEO Skills, Abilities, Experience and Latent Talents, and a Myriad of Organisational Details

Article excerpt

The following questions will help applicants for CEO roles make a balanced decision about whether they will be a good fit for a particular role and, if so, increase their chances for success at the top.

Where does the organisation sit in its business life cycle?

Develop a clear understanding of whether you are joining an organisation that is in its initial high-growth phase; reaching maturity; declining; or kicking into its second growth cycle. Most importantly, determine whether there is widespread recognition and acceptance by individual board members of the business' life-cycle stage.

Is the company's strategy built on a long-term sustainable competitive advantage? How do you know?

Do not rely solely on information provided by the organisation. Complete your own SWOT analysis. Talk with competitors and current and former customers. Search the internet. Analyse industry trends. Look at benchmarked data for both domestic and international markets. Form your own opinion.

Has the business model passed its use-by date?

Aggregators, e-commerce, new competitors or technology may have had a major negative impact on the business. It is important that you know if the board truly recognises this or is still in denial. Ask whether the board has considered a Greenfields approach to the development of its business plan. If not, the board should have directed the development of a business plan recognising: industry trends, new technology, competitors, factors impacting on the business model, geographic factors related to sales and support; and traditional and non-traditional competitors.

Has the board emerged from a cost-cutting phase or is it locked into ongoing cuts?

No one ever downsized to greatness. During the process of downsizing trust and morale are often destroyed. Unless the board is focused on re-growth strategies and not further cost cutting, your tenure as CEO may be short-lived as you will not be demonstrating additional profit from new customer acquisition and revenue growth.

Is the board focused on the short or long term?

While the board may talk about being in for the long haul look at what shareholders and board members have done in other situations. Consider specifically, whether they are long-term players or just looking for a quick return.

Is there a business reinvestment strategy? Or is there a single-minded focus on shareholder returns right now?

So far, there may not have been calls to reinvest in the business. Flush out boardroom thinking by asking about members' reinvestment track records: either in this or other business interests.

Is it a public or private company?

If private, evaluate the key shareholders. Meet one on one with each of them. Consider:

* Whether there is a dominant personality;

* To what extent they are likely to let you do your job without interference;

* Whether the board has been stacked or if there is the appropriate blend of disciplines to take the company forward;

* Will directors do what is right for the company or do some board members pursue personal agendas?

* Will primary shareholders continually second-guess the CEO by calling in regularly at offices or taking staff to social events etc?

* Is the owner or dominant shareholder an entrepreneur?

Does the board truly understand its role?

Especially when considering taking a CEO role in a private corporation, work out whether the board will stick to strategy design and evaluate the CEO on their execution of that strategy. Be wary of boards that spend too much time debating operations. This often does little to ensure the long-term profitable operation and market superiority of the business.

Is the organisation's governance charter just a wall hanging or a code to live by?

Quiz board members on their knowledge of the charter. …

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