Magazine article Management Review

The Changing Role of the CEO

Magazine article Management Review

The Changing Role of the CEO

Article excerpt

Despite the title of this month's column, the fundamental role of the CEO, in truth, never changes: The CEO is responsible for a company's success and reputation and is accountable for overan results. Because of the simplicity of this job description, the role is played on various stages in an astonishing variety of ways. One of my strongly held beliefs is that managers, to fully succeed, must be fully themselves. The XYZ Corporation does not need a particular "type" of CEO with a specific "style." It needs instead an able chief executive who understands the business and is committed to the corporation-its customers, its employees, and its future. Still, various times in the life of a company seem to require different leaders.

For example, John D. deButts, a former chairman of AT&T who strongly fought the federal government's antitrust efforts, was succeeded by Charles L. Brown, who understood the inevitability of the corporation's breakup and implemented that onerous task. Some observers claim that deButts, because of his deeply felt resistance to the breakup, simply could not have succeeded in making it happen. Next came Chairman James E. Olson who, faced with managing the still-giant AT&T in a strange and newly competitive world, reduced costs aggressively-by more than $1 billion last year alone. Upon his sudden death in April, Olson was succeeded by Robert E. Allen, who earlier had been described as customer-oriented, impatient with bureaucracy, and demanding of performance. Management under Allen will need to forge fresh strategies and build a new culture. By choosing CEOs with distinct management styles, AT&T's board of directors seems to have shown an understanding of the need for very different leaders for different times.

Over many years I have had the opportunity to observe six successive chief executives of another major corporation. The first, the company's founder, created an enduring vision, and the second both fulfilled and greatly added to that vision. Their successor was a genius who, before his time, not only "thrived on chaos" (Tom Peters' recent term), but created it wherever he went. Yet, in his turbulent way, he succeeded. An "organization man" came next-an unflappable delegator, bordering on the bureaucratic, yet a budder. Following him was a towering intellect, a hands-on manager who mastered the details of virtually all parts of the business. Now leading that company is an affable, but tough-minded, individual who is particularly good at setting direction and motivating people to follow his lead. These six chief executives could not have been more different from each other, yet each was right for his time.

In smaller companies, too, CEOs exist in infinite variety. With far fewer resources and less expertise available within their firms, most CEOs learn how to find enough of each to succeed. As president of AMA, each year I am privileged to meet hundreds of chief executives of large and small companies and-even more factinating-to spend extensive periods of time with some 50 of them. As a result of this experience, several myths have been overturned in my mind-for example, the myth about it being lonely at the top. In truth, CEOs are surrounded by other people and buffeted by their demands. For the men and women who hold chief executive responsibilities, a moment of solitude is a luxury. And the CEO who chooses to be a loner in decision making is both rare and foolish. For many, the best sounding board is a long-term director whom the CEO implicitly trusts. …

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