The decisions made by CEOs will ultimately define the legacy they leave behind. Richard Branson is the inspired entrepreneur. Steve Jobs the genius who changed our relationship with technology, while Jack Welch is famed for his no-nonsense management style. So what plans should a business leader be putting in place to ensure their long-term reputation is synonymous with a company’s success?
Firstly, it’s a case of accepting that the average CEO doesn’t have the time in charge afforded to the likes of Branson, Jobs and Welch. Kai Peters, CEO of Ashridge Business School and a Criticaleye Thought Leader, says: “A lot of CEOs aren’t in the job long enough to leave much of a legacy. Tenure is less than five years on average and declining… and research indicates that to make a significant change in an organisation it takes a little bit longer than that.”
So, from day one, you’ll be under pressure, balancing short-term priorities with long-term strategic goals. Criticaleye spoke to a range of business leaders to find out the five steps that need to be taken in order to make the right kind of impression as a CEO.
1) Know Your Purpose
A leader who fails to articulate a compelling vision for a business will not last long. Andrew Heath, President of Energy at engine maker Rolls-Royce, says: “It’s about focusing on what really matters and finding that in the business that you’re running. You’ve got a responsibility to be the architect for the future of the business… [so] it’s a matter of focusing on that sense of higher purpose, the direction you’re trying to take it in and it’s about getting strategic coherence across the organisation.”
Colin Hatfield, Senior Partner and Founder of Visible Leaders, a consultancy that specialises in leadership communication, says: “I always get a little worried when I hear leaders saying that their ‘going in’ position is to build a legacy. I think they should start by saying: ‘I’ve got to do what I think is the right thing for this organisation’… Leadership generally is about making change happen and the CEO is the epitome of that.”
2) Be Realistic
Only so much can be achieved by a CEO at any given moment in time, particularly in the early days. Matthew Wright, Chief Executive of Southern Water, comments: “Whether it’s a cultural legacy; a [track record] of under-spending on asset maintenance or whatever, there is often a period where you’re trying to dig yourself out from under a legacy that isn't entirely positive.”
Howard Kerr, Chief Executive at standards and training provider BSI, says: “As an incoming CEO, you’re always very conscious of what your predecessor leaves you. When I leave there will be something that my successor will have to work on that I haven’t necessarily addressed effectively. You’ve got to be very honest about what… you are leaving behind and recognise that no CEO or organisation is perfect.”
3) Get the Team Behind You
Teams will perform to a much higher level if they believe in what they’re doing. Peter Horrocks, Director of BBC Global News and World Service, comments: “The key is to convince people that the changes you want to make during your period in charge are not contrary to the central values of the organisation, but that they will help to sustain it and to make it more successful in the future… You can get into a situation where people see that someone is changing things in such a way or to such an extent that they react against it.”
Matthew comments: “We go on the road, meet all our employees and talk about how they can start to influence the direction of the company… [we’re] very clear about why we’re here, what our vision and mission are and what roles people have within that so that they can connect with the organisation and its objectives.”
4) Cast a Shadow
“If they don’t notice when you arrive, they’re unlikely to notice when you leave,” says Lucy Dimes, Non-executive Director at textile services company Berendsen and former UK & Ireland CEO of telecoms concern Alcatel-Lucent.
Andrew comments: “I try and put my personal mark on things, so I do a weekly blog in which I talk about the key strategic themes and priorities, such as health and safety, and the values we have around ethics and compliance. I talk about what I see is going well and where I see things not going so well, reinforcing positive behaviour and recognising individuals who portray the right values and who are being highly supportive of executing the strategy.”
For Lucy, a leader must be capable of engaging. “Did people remember it as a good era, a time when things changed and when the leader touched their lives rather than just operating aloofly over the organisation?’
“The leader sets a tone and casts a long shadow on the organisation, so you’ve got to make a personal impact. At the same time you want to create things that everybody agrees are right for the organisation and not just the way that [you] do things, so that when you leave they are seen as changes that everybody has played a part in creating.”
5) Build Long-Term Value
Sam Ferguson, Group CEO and President of EDM, an information management provider, says: “There is a short-termism in business… which means, instead of investing to create the right business for the future, many people end up maximising profits now so that the chief exec can get his bonus... I think there’s a bit of that in the UK that needs to be rectified, so that [CEOs] are more focused on building businesses with the long-term future in mind.”
When it comes to creating value, a CEO will make a lasting impression by getting good financial results and by leaving behind a capable team. Kai comments: “You should be investing for the long term. You bring talent in and you make sure you facilitate the capacity for people to talk to each other without you having to be the omniscient one in the middle. Between bringing in some new faces and getting people to talk to each other, hopefully you generate some intellectual property.”
In the final analysis, a CEO should realise that their role requires them to be a steward, serving the company to the best of their ability before moving on. “No one individual is bigger than any organisation, whether they’re the chief executive or in any other position,” says Howard. “The company’s interests always trump those of the CEO.”
I hope to see you soon.