If you are a CEO or those of you that have good visibility of your CEOs work, do you pay attention to the types of decision you make/your honcho makes? The kind of decision the CEO makes is indicative of leadership pedigree and organisational health
Yes, organisational decisions have to be made – and as the overall boss, the CEO is paid to make decisions big or small, for purposes of having the organisation activities remain closely aligned to its strategic goals.
However, CEOs tend to get involved in decision making, strategy influencing or not. And the latter should be of concern to OD. practitioners – CEOs should remain on the strategic turf when making decisions. Even when they veer to another decision-making turf, it should be deliberate, infrequent and on the clear understanding that the boss will get back to their decision-making turf at an agreed point in time
So – in this blog, the Effectiveness lab is putting CEOs to task on their decision-making practices. If you are a CEO – what type of decisions do you get your hands on?
- Strategic with immediate impact
- Strategic with medium to long term impact
- Tactical with both immediate and medium/long term impact
- Operational with both immediate and medium/long term impact
The CEO is paid (at the classic organisation) to make strategic decisions. A CEO that makes decisions at the tactical and operational levels is doing work that they aren’t paid to do. Indeed we should ask what the people paid to do such action do. They must be idle, frustrated, confused and wondering why they were hired.
Even at the strategic level, quintessential CEOs make decisions, but with medium to long term impact.
It’s okay for you as the CEO of your company to make strategic decisions that impact your organisation now. But that isn’t good enough – you are a myopic and late-acting CEO. The ‘strategic-now’ decisions should have been made three or so years back. In the present, the CEO should be making strategic decisions that shall impact the organisation no less than three years from today.
And, the decisions by the CEO don’t only have to be strategic-cum-medium to long term impact, but they should also be few in number. There is a quantitative matter to address. CEOs can’t do as good a job when they have to deal with more than four long term strategic matters a day, or a week where the specific decision’s process-elasticity is wide. To believe that a CEO can do more than four and attain decision efficacy is a fallacy.
At the Effectiveness lab, we profess that the appropriate daily maximum strategic-decision-load for a CEO is three to four strategic issues and no more
The CEO decision-making Achilles heel
We are aware that few CEOs, very few indeed, deal with strategic-cum-medium to long term decisions consistently. And this is the CEO’s decision making Achilles heel – i.e. keeping on the strategic turf plus think medium to long term. At times CEOs don’t even have a choice but to abandon the so-called strategic turf. Especially when it’s about the immediate survival of the organisation and themselves
Often, CEOs remember to think long term during the quarterly or annual strategy review meetings or when they read a blog like today’s; but the natural tendency is to get back to the ‘daily and now’ grind of their offices
We have written above that CEOs shouldn’t deal with tactical and operational matters, immediate or medium/long term impact or not. The latter tasks should be accomplished by individuals below the CEO’s office – but CEOs get involved, and all the time
So, why do CEOs do non-strategic work or strategic work that isn’t medium/long term in nature? We outline the reasons below:
- The organisation’s strategic direction is not clearly articulated or lacking, causing a scattershot approach to business – i.e. too many goings-on at any one time – can’t see the wood for the trees – and the CEO’s job becomes that of supporting a nonplussed team find its way
- The organisation’s structure isn’t aligned with its strategic objectives; the form vs function disconnect
- The organisation doesn’t have the right calibre of staff and a sustainable manpower plan; there usually is something HR that is broken
- The CEO is a micromanager
So – what type of decisions are you/is your CEO planning to make this week?
Categories: You, the Leader!