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The habits of exceptional CEOs

Published in the Rochester Business Journal

Lisa Withers keeps the three-year strategic plan for Spectracom Corp. on her desk and looks at it weekly. From that document comes the company’s operating plans, which in turn dictate the senior team’s goals.

While Withers, president and CEO, calls herself a “compulsive planner,” her systematic focus on the bigger picture reflects what research has shown to be necessary if a CEO – and his or her organization – is to thrive in a challenging marketplace.

Exceptional CEOs devote more than half of their time to high-leverage tasks that enhance the organization’s business model and therefore profitability, according to Mark Helow and Jim Schleckser, principals in the CEO Project, which has been studying CEO effectiveness for 15 years.

“Instead of dozens of projects and tasks,” Helow and Schleckser contend, “(world-class CEOs) focus only on the vital few that will improve the company’s long-term competitive position. … The secret to their effectiveness is spending time on selecting the business model, growing their human capital, and developing processes to consistently create and delight customers.”

Along with maintaining a long-term, high-level focus, Withers also is committed to creating and developing a strong team at Spectracom, which designs and manufactures GPS network servers and timing devices. Founded in 1972, the company employs about 45 in Rochester and has a sister organization in France. Spectracom was ranked No. 64 on the latest Rochester Top 100 list of privately held companies.

“You really can’t do everything yourself,” she says. “You have to surround yourself with good people you can trust.”

Mark Peterson concurs. Interim president of Greater Rochester Enterprise, a public-private economic development initiative, Peterson oversees some 11 employees. He teaches a graduate course at SUNY Brockport, serves as chairman of a brand-new independent Catholic school in Mendon, and is vice chairman of CDS, which recently built a $10 million facility in Webster.

For every task that lands on his desk, Peterson asks himself: “Can someone else in the organization do this?” Even if that person can perform it only 80 percent as well as Peterson can, he’ll show him or her how to master the task so that he can let it go for good.

Peterson also insists that employees do most of their own problem-solving before asking for his input. Expecting employees to weigh several solutions in advance allows subordinates to own the problem and to avoid viewing the leader as the “savior.”

Unfortunately, not all CEOs are as effective at maintaining a focus on high-leverage activities. Earlier research by the CEO Project found that, among CEOs studied, fewer than 20 percent of the hours worked were spent on “significant priorities” linked to long-term business results.

Similarly, research published in the Harvard Business Review in 2002 found that, of the managers observed in 12 large companies over a decade, only 10 percent concentrated on work that would have a long-term positive impact on the business.

The anxiety factor

Recall the metaphor of gazelles and lions in Africa: Every day, the gazelle must outrun the fastest lion or be killed, and the lion must outrun the slowest gazelle or starve.

With global competitors snatching business away from U.S. companies on a daily basis, CEOs too often behave like lions or gazelles – constantly running. But, as so many CEOs have discovered, maintaining a frenzied pace is unlikely to translate into exceptional performance.

Often, the good feelings associated with completing familiar tasks tempt CEOs to spend undue time on them, researchers have found. Those tasks might include culturally revered practices like rolling up one’s sleeves to help or taking the lead role on a new initiative.

In a Harvard Business Review study published in 1982, Ronald Ashkenas and Robert Schaffer wrote that executives often choose busyness rather than face the anxiety of:

  • Tackling innovative activities.
  • Managing and modifying one’s daily work routines.
  • Responding to pressure to improve performance, without additional resources.
  • Refusing to allow subordinates to give their problems back to the boss.

Research also has found a disconnect stemming from the average CEO’s poor understanding of his or her role in the organization. A CEO’s job is not to keep the company chugging along; an average group of competent employees can probably make that happen. Instead, he or she is paid to develop innovative ways to move the business to new heights.

Conclusion

As organizations increasingly look to the prudent use of the CEO’s time and energy as a tool for achieving competitive strength, Helow and Schleckser advocate that the CEO continually ask himself or herself the following questions:

  • Am I committed to creating a significantly different outcome for my organization?
  • What three actions am I taking to raise my performance as a CEO? How do I measure my effectiveness?
  • Do I regularly consult with external leaders who challenge my assumptions, and do I apply those learnings to strengthen my organization?
  • What am I doing today to move the organization closer to our goals?
  • Have I correctly assessed the organization’s management talent, and have I made the difficult moves to continually upgrade it?
  • Do I continually analyze and improve core processes like creating customers and delivering customer delight?

With systematic, rigorous attention to such matters, a CEO may look much less a lion or a gazelle and more like the leader of an exceptional organization.

 

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HR Works, Inc., headquartered at 200 WillowBrook Office Park in Fairport (Rochester), New York, with an office in East Syracuse, is a human resource management outsourcing and consulting firm serving clients throughout the United States. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.