Good CEO – like a GPS unit with a defined destination

Why should we compare a CEO to a GPS unit? It may sound bizarre to many of you. However, a CEO at the modern organisation cannot be successful without getting a good briefing on ’the direction’ the organisation they lead has to take. We shall interchangeably call the latter Destiny or the North-star.

The CEO & GPS Unit story

The CEO & GPS Unit story

If not at the interview, CEO’s will ask for the organisation’s business plan or strategy document on their first day at work. CEO’s, good ones at that, think about the destiny of the organisations they lead, and the pathways they have to follow to get to that destiny.

Destiny to a CEO is like suckling to the newly born of a mammal – a calf born to a cow, a baby born to  humans will soon after birth, instinctively look for the breast of its mother.

However, it takes a journey to arrive at the organisation’s destiny. A journey that needs planning and with many hard manoeuvres – that is how we relate a GPS unit to the CEO.

What do GPS units do, how do they work?

The Global Positioning System (GPS) is a network of about 30 satellites orbiting the Earth at an altitude of 20,000 km. The system was originally developed by the US government for military navigation but now anyone with a GPS device, be it a SatNav, mobile phone or handheld GPS unit, can receive the radio signals that the satellites broadcast.

Wherever you are on the planet, at least four GPS satellites are ‘visible’ at any time. Each one transmits information about its position and the current time at regular intervals. These signals, travelling at the speed of light, are intercepted by your GPS receiver, which calculates how far away each satellite is based on how long it took for the messages to arrive.

Once it has information on how far away at least three satellites are, your GPS receiver can pinpoint your location using a process called trilateration.

The relationship between a GPS unit and the CEO:

GPS units define the most efficient and effective route to the chosen destination, on condition that you key in the right destination. Get the wrong destination in your GPS unit or enter nothing at all, and the unit will take you into the wilderness.

CEO’s don’t want to end up in the wilderness – they will have failed at their job. It goes without saying that CEO’s want their destiny clearly defined to enable them identify pathways that get them to such destiny, moreover efficiently and effectively.

The pathways are in effect the ‘GPS coordinates’ – CEO’s spend the majority of their time aligning coordinates to organisational destiny

Just like the GPS unit provides direction to those of us moving in complex urban environments, but only after we key in the unit the right destination; CEO’s need manifest-destiny from the owners of enterprises and their representatives (board of governors), to be able to steer towards such destiny. Anything less than the latter may condemn CEO’s to steering into the wilderness.

The pictorial below shows the relationships between an organisation and a GPS unit:

Owner - Owner rep. - & CEO relationships

Owner – Owner rep. – & CEO relationships

The Owners or Investors define the direction the organisation should take. The Owners are represented at the company by the Board of Governors; the Board of Governors is the interface between the Owner and Management – i.e. the CEO and their team.

In this Owner, Board of Governors, and CEO relationship-maze are various reciprocal stakeholder interactions. The Owners directly interface with the Board of Governors and between them, articulate the overall direction the organisation should take. The Board directly interfaces with Management through the CEO and between them, they approve the ‘GPS coordinates’ that the CEO and team choose to steer the organisation towards the owners defined destiny. Also, the Board and CEO monitor the ‘GPS coordinate’ alignment to Owner defined destiny.

There is also the occasional interaction between the Owner and CEO. This is a ceremonial relationship that often happens when the owner visits the organisation. Interaction at this level is less to do with business

In the middle of this pictorial is the overall North-Star or Destiny for the organisation. It ought to be recognised that the relational interfaces between Owner and Board and Board and CEO need to happen to realise alignment to the North Star (destiny).  The two are non-negotiable.

Of course, It is the CEO’s job to ensure that the organisation they lead is aligned and moving towards its North Star. However, that can only happen if the Owners and their representatives (board) have done their job and defined the North Star

So, CEO’s should ask for the organisation’s Destiny or North star all the time; not doing so is setting themselves up to fail

What if the Destiny is not defined?

It may be that for certain organisations, destiny is not defined by the Owner or their representative.

In such instances, the CEO should not sit on their laurels waiting for destiny to drop like manna from heaven. The CEO should wear the owners hat and ‘define’ direction – however, the CEO should remember to have, whatever they define as destiny, signed off by the Owner or their representative. Not doing the latter is tantamount to usurping the powers of the Owner – and good CEO’s do not do that

Confusing as it may be, yes, CEO’s at times need to do more than define ‘GPS coordinates’. They do the latter, instead of whining about the lack of direction. CEO’s have to learn to swing like a pendulum between management territory traditionally cut out for CEO’s, but also when necessary, step on to the ‘sacred’ ground of – the Owners and their representatives.

CEO’s that do the above need to exhibit quintessential political savvy skills – this is extremely dangerous territory to tread on. It almost is a thankless task, but one good CEO’s have to be ready to do as and when required

However, even when called upon to do more than what is normal CEO work, CEO’s should always remember to return to their cardinal role: defining ‘GPS coordinates’ that get organisations to a chosen destination; a destination that should be defined by the Owner or their representative.

So, the CEO’s role still remains: ‘GPS coordinates’ definition and dealing with the accompanying dynamics. That is why you get your CEO pay cheque every month



Categories: You, the Leader!

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7 replies

  1. AG: Thank you so much, just thinking about the Uchumi supermarket New CEO, we all know that he is good, based on his past performance at KWS, when he joined Uchumi we thought that he is going to revive it but apparently the Co-ordinates which were put in place by his predecessor were long term and made the leading supermarket to fail . He might be having the good will of Uchumi but I am afraid he will not achieve much in the first two or three years .
    what is your thought ?

    Teresiah

    Like

    • Teresiah – first of all, thanks for reading the blog.

      A good example of the Uchumi CEO, you give – well, first and foremost, coordinates are not cast in stone; if I were the Uchumi CEO, I would change the GPS coordinates i.e. enter new ones. We don’t always have to think long-term, esp. in a turbulent business environment.

      CEO’s can opt to take short ‘journeys’ at a time, allowing enough time to evaluate progress towards the North star. Why define the journeys 100%, when ‘visibility’ ahead is poor?

      Strategy scholars will advise the Uchumi CEO to apply Henry MIntzberg’s ‘Emerging-Strategy’ pro-type at Uchumi. It is too foggy for him to assume he will know in one go, how to get from A – B; so he had better look at varying ways of creating value at Uchumi, that will over time, create definitive patterns of value-creation.

      Welcome to the trials and tribulations of a CEO!

      Like

      • Dear Apollo : Thank you for your quick feedback, true they are not cast on stone,a good example is the current CEO at KQ, his predecessor invested heavily on new planes, renovated a waiting bay using imported materials which are readily available in Kenya, trained one staff at a cost of Kshs 1.5 million which was mandatory to all staff and the course was not relevant. This is to mention but a few. Three years down the line, KQ cannot be able to maintain the new planes which were bought on credit and the supplier have threatened to detain them if they land in their country, over 600 staff will be declared redundant and the planes will soon be sold at a loss.
        When the former CEO was doing all the above, everybody was happy, the board did not raise any question and they thought the coo-ordinates set will work. Mmmmmmm
        The new CEO is now cleaning up the mess ,trails and tabulations.

        Teresiah

        Like

        • Another very good example Teresiah – couldn’t resist typing away as I wait in the Nairobi jam

          You introduce an aspect however, that me and you may not have the answer to: did the KQ board articulate the North Star for the ex-CEO? Was it a practical and viable North Star?

          If indeed the KQ board defined the ‘correct’ N-Star for the entity, then their oversight of the defined coordinates and subsequent org. Journey, wasn’t good enough – in effect, the board may have let down the Owner!!

          Good CEO’s, as discussed, should at times behave like a pendulum and occupy Owner territory, even if for a short time – I am sure that is what the new KQ CEO is doing – forced to wear multiple hats in the process to align N-Star and GPS coordinates – I pray that the guy has a new board

          👏🏿👏🏿👏🏿

          Like

  2. ABG, thanks for yet another very insightful article: defining direction of the organization. From the article you have brought it clear that CEOs are organizational “Drivers”. But, drivers can only drive well on well maintained wheels, well designed and maintained roads and never allowed to take direction not authorized.

    Here, I’m trying to think about this concept the “company mind” – as represented by the mind field. The Company mind will only attract business opportunities that resonate with it. In this case therefore, the Company mind determines company results.

    What if the Company mind does not see the right opportunities? Can the Driver (CEO) change direction? Remember GPS coordinates will have already been determined and a defined direction decided by both the owners and the Board.

    Still thinking……………………….please wait,

    Seddu Okugga

    Like

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