Platt Perspective on Business and Technology

What do C level officers do? 17: Chief Executive Officers and Presidents 3

Posted in career development, HR and personnel, job search, job search and career development by Timothy Platt on February 9, 2015

This is my 17th posting to a series on what C level officers of a business or organization do, that specifically emerge as job requirements for the senior leadership of an organization (see Guide to Effective Job Search and Career Development – 3, postings 376 and following for Parts 1-16.)

I began a discussion of leadership at the top of an organization and of its overall C level executive team in Part 15 of this series, where I briefly sketched out a simplest case baseline scenario with a single and uncomplicated pattern as to who is responsible for what and who makes binding final decisions on what, at the top of the table of organization. And the defining features of this scenario are that decision making authority and responsibility are fully aligned, and that they are organized in such a way as to limit and even explicitly prevent gaps or duplications in determining who is responsible for what decisions. And that, of course only represents one possible management and leadership scenario that can arise at the top of an organization, and a simplest one.

I offered in brief acknowledgment to that last point, a list of four possible and I add fairly commonly recurring alternatives to this simplest case scenario, in Part 15 as well. And I began more fully addressing them in Part 16 with discussion of a formally divided leadership scenario – one that is actually officially spelled out in the table of organization where:

• A business has separate positions of President and CEO that are held by different people.

And as discussed in Part 16, I noted there how this type of situation can arise in a variety of ways and with differing consequences so this in fact represents a suite of possible alternative leadership scenarios and not just a single one.

My goal for this posting is to continue this discussion by delving into the issues raised in my second of four alternatives to the basic model which I repeat here from Part 15, where a business has:

• An owner who takes a very hands-on approach to their business, and a most senior executive manager who works for them but who at least nominally holds senior executive authority over that business, and by whatever name that executive level officer would be identified by.

This is a situation that I have worked under, as an interim executive officer brought in to help address already existing problems – and to help distinguish between underlying problems and their more overtly visible consequences and symptoms. And if anything, this is both more consistently a source of leadership and executive management problems, and a more persistent one than would generally arise from the first group of scenarios from my list as discussed in Part 16.

• A key word that I would cite in explaining that observation is consistency, or in this case a lack thereof.
• The more hands-on an owner is in stepping in to overrule their senior business manager, and even when they have stated that that manager is responsible for that area of the business, and the more inconsistent they are as to when and where they will do this, the less consistency there can be as to whether any executive decision can be relied upon or that it can hold any weight.

Together this means bad decisions tend to be made from always having to second guess what the owner would want instead of focusing on what the business actually here-and-now needs. And this means that even good business-wide decisions are not going to be consistently adhered to as everyone else in the business sees how decisions made are second guessed, formally overruled or simply ignored by the owner as they make what are generally more ad hoc, case by case decisions.

• Most business owners take a hands-on leadership role in their businesses and that is good.
• The problem that I write of here arises when an owner does that but without consistency,
• And when they bring in what is nominally a business manager for handling day-to-day leadership responsibilities, and even what should be a significant amounts of overall business strategy – but where they recurringly and even seemingly continuously second guess their manager by title, and undercut their authority.

A business owner cannot have it both ways on this and have their business function effectively. They can actively lead it themselves and with all of the time and effort commitment that takes and they can be the President and Chief Executive Officer who is officially in charge. Or they can be an equity owner and even the sole equity owner but one who leaves operations at the very least to a business professional who thrives on that, to manage for them – and with their role more strategic and more collaborative, and where they do not step in as long as the business remains competitively effective.

I write here of a delicate balance. A business owner might own the equity of their business and gain the major reward from its overall success but they carry a proportionally higher matching share of risk and of potential expense and loss too. So if an owner is to take a more hands-off role for the day-to-day running of their business, it is vitally important that they find and bring in an executive business manager who they can comfortably work with and who they can trust, and for both ongoing operational decisions and for at least here-and-now strategic planning and execution too – even if they seek to have a significant overall and long-term strategic voice in their business themselves.

I cited “consistency” as a crucially important word in the thread of discussion offered in this posting and I add the word “trust” as equally important here too. This type of system can work and very effectively – but only if those qualities are actively strived for as guiding principles in how the owner and their manager work together. And one crucial metric for how effectively this is done is in how effectively authority and responsibility are, or are not aligned.

I am going to continue this discussion in my next series installment with the third of four potentially complicating scenarios that I first listed in Part 15:

• Where a business has an alternative type of board of directors to that of my simplest case scenario as briefly outlined in Part 15 (e.g. a ruggedly independent board, to use the terminology of my boards of directors taxonomy), and with all of the potential for conflicts of leadership authority that this can create.

And after that I will finish this phase of this larger discussion of C level officers and what they do, with a discussion of the fourth and final alternative scenario from Part 15. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 3 and at the first directory page and second, continuation page to this Guide. I also include this posting in Page 2 of my Human Resources and Personnel directory and also see its Page 1 for related material.

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