Propeo Perspectives

Propeo Executive Search

The top spot is a more dangerous place to be these days. We are seeing on the part of shareholders heightened expectations and lowered tolerance for more than two quarters underperformance, resulting in what some are now calling the revolving door outside the corner office. This is all part of an intensification of competitiveness in general, and it is making what was never an easy job even more tough. As the saying goes, failure just ain't what it used to be. No wonder the "hot seat" is now being called the "ejector seat".

One could argue whether this trend is actually just placing appropriate degrees of accountability where it belongs, or whether it is in fact short-sighted and creating destructive after-effects. But whatever the analysis, it does not take away the need for both individual executives and their boards to deal with new realities.

In a Harvard Business Review article entitled Don't Hire The Wrong CEO, Warren Bennis and James O'Toole speculate that current CEO churn results from the failure of boards to select candidates who can demonstrate real leadership. And this is the same quality that has been studied and sought over the centuries, "...a combination of personal behaviors that allow an individual to enlist dedicated followers and create other leaders in the process."

We in Propeo Executive Search have observed that it is uncommon to get early alignment among board members on exactly what qualities are required in a CEO, and we always advise that such agreement be reached before commencing the search process. In selecting a CEO candidate, we believe there are a number of things worth bearing in mind...

	Firstly, a key facet of leadership is the ability to create and communicate a compelling vision for the business. This comprises the company's purpose, or reason for being, and its identity, or 'who we are'. This message must touch every member of the organisation, and effective CEOs use every opportunity to reinforce it. This is now even more important than before, as many organization structures move from a hierarchical to a 'hyperlinked' model.
	Secondly, given both the complexity and the speed of our business environment, it is now impossible for a 'command and control' executive to be fully effective. Management by edict is dead. Decision-making must be allocated out to teams of leaders who are informed and empowered to operate effectively. Therefore the key skill lies not in taking the decision, but in creating effective decision-making capabilities in the organization.
	Thirdly, we do not envision any CEO achieving the company's potential without a very strong empathy with the customer. This does not necessarily mean that CEOs with marketing and sales backgrounds are better, but the individual should certainly demonstrate how the customer features at the heart of his or her thinking and decision-making.
	Finally, while we believe that the whole tone, style and ultimate business performance of the organisation will be traced to the CEO you choose, we also observe that this leader will have to be successful through giving increased responsibility for success to others. In one sense this is a contradiction, but it is also the key competency required, for in our view, it is only by the creation and support of competent, energised and interconnected teams can the 21st century CEO deliver outstanding results.

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