Jeff Rosenthal is Co-CEO of ProjectNext Leadership, a consulting firm focused on developing leaders and successors for high impact roles.
CEOs have navigated the last couple of years amid great uncertainty. Expectations of CEOs have both increased and broadened, yet they’re still contending with difficult business conditions. My company has conducted research and interviewed CEOs of mid-size to large companies to get a better sense of how they are adapting today. Given that most CEOs can’t take on more since most are already at their max bandwidth, we’re seeing several key shifts CEOs are making to create success in today’s business conditions.
Based on this, here’s how the expectations surrounding the CEO have evolved and the three major pivots CEOs are taking to adapt to today’s business environment:
1. The people aspect of the CEO role has taken on primary importance. CEOs now need to focus heavily on talent in the organization: recruiting, developing, retaining and succession planning for top talent. While this has always been on the CEO’s radar screen, the focus on people is a top priority today.
2. Building a cohesive executive team is a universal challenge. The need for today’s CEO to drive cross-functional collaboration has never been greater. Without it, CEOs feel the unique burden of being the only leaders with accountability and a true enterprise perspective.
3. It’s all about communication—in every direction. CEOs have had to supercharge their communication but have also had to amplify their listening in order to effectively sense what’s happening with their organizations and markets. CEOs are noticing how virtual work typically drives more formal communications, so they need to create informal channels that are also critical.
4. The boundaries of the CEO role have expanded. Both employees and investors now expect CEOs to take broader stands on societal issues where they can have an influence. CEOs now feel a direct responsibility for creating more diverse and inclusive workforces, and in many cases worry they don’t know how to make progress. CEOs are also increasingly focused on the ecosystem they’re in—not just with customers, but with potential partners and communities.
5. The last two years have tested CEOs in uncharted ways. CEOs have felt the burden of keeping organizations steady in stormy conditions. At a time when leadership has been most important, the tools that CEOs use to lead have become constrained or converted.
The Three Pivots
Given these dynamics, we’ve seen three key “pivots” needed for many of today’s CEOs in order to thrive in this new world of work:
Pivot No. 1: From Building Functional Excellence To Creating Executive Team Alchemy
Whereas yesterday’s CEOs focused heavily on creating strong functional teams, today’s CEOs drive a more holistic approach. CEOs simply can’t succeed in their roles unless they have a strong and united executive team to take direct responsibility for aspects of the business that the CEO doesn’t have time to drive.
CEOs today are making it their mission to create collaboration across their teams in a radically expanded way. CEOs are spending more time developing their executive teams to be high-performing units by creating interdependent enterprise priorities, defining decision-making rights and introducing new team “mechanics” to facilitate communication.
Pivot No. 2: From Defining Strategy To Inspiring People
While CEOs still need to ensure they have an effective strategy, it is more urgent that they engage the right people in the business, starting with the executive team. Communicating the company purpose, hiring and keeping great leaders, celebrating wins and building company confidence are all critically important priorities for today’s CEO.
CEOs are more centrally involved than ever in ensuring their organizations attract, develop, retain and inspire their employees and their key “stakeholders.” CEOs have dramatically increased how much they communicate and interact with their people.
Pivot No. 3: From Driving Financial Results To Creating Societal Impact
Today’s CEO is still expected to achieve results but also to provide benefit to investors, employees and society overall. Taking action on major societal issues appears to be less optional for corporate CEOs: It’s now an expectation for success. Look no further than the recent geopolitical conflicts and how employees and customers are watching every move companies make in their responses.
The past two years have created both strain and opportunity for CEOs, and those who’ve retooled how they lead have adapted well to a new landscape. This shift has implications for other C-suite executives as they have many of the same challenges, opportunities and adjustments as those experienced by the CEO.
The “Great Rethink” requires key pivots for leaders in the CEO role to navigate these rapidly changing conditions. The best CEOs of today and tomorrow are growing strong executive teams, focusing on talent as a top priority and finding ways to broaden the organization’s impact, leaving some more traditional responsibilities behind (or to others) in order to thrive.