What should CEOs really do

DUBAI - Since the CEO is responsible for delivering the financial expectations of the shareholder, he must be clear himself, and must clearly communicate it. The strategy for faster revenue growth is different from faster profitability growth. Pick one realistic financial objective, and build a customer, product, process, organisational, and IT strategy around that. No more than 25 objectives, so that you can divide it amongst the 5-6 direct reports.

By Sanjiv Anand

Published: Mon 7 Apr 2003, 12:37 PM

Last updated: Wed 1 Apr 2015, 7:37 PM

Most CEOs get so tired of the strategy formulation process, that by the time it comes to implement, they would rather rely on the CFO tracking performance on budget variance.

A better solution is rather than tracking all the initiatives and activities, focus on monitoring the top 20 financial and non-financial objectives defined in the strategy, with greater focus on problem solving in areas of strategic performance that are lacking.

And most CEOs have too many direct reports and the quality is suspect.

They either put it in committee decision mode (which means no decisions) or they push it upwards.

How much time does the CEO or even the board focus on customer issues? No more than 10 per cent. We can't seem to get ourselves out of the habit of thinking that if we set up a great plant / trading operation, the products will sell on their own. Spending 20 per cent - 25 per cent of your time on customer issues will go a long way in securing sales andrevenue targets.

Companies spend large amounts of money every year on projects that they can't even remember why they started, or what value they will bring the enterprise. Let's learn to pick the right set of projects that help deliver strategy before we jump into the next lot.

A culture of pay for performance and hard work will lead to strong performance.

A final word for those that will complain that they cannot implement most of the above because they work in family owned businesses. 80 per cent of the world's businesses are family owned. So unless you are planning to leave this planet anytime soon, might as well get going on the above, and enjoy the ride.

Sanjiv Anand is the Regional Director Asia/Mideast for Cedar Consulting, a management and IT consulting firm.

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