The role of the CEO is changing - what does it take to become a great leader?
I’m often asked ‘What does it take to become a CEO?’
There are multiple answers to that question. Sometimes it’s luck. Other times it’s being in the right place at the right time. Politics can also play a part. Sometimes you’re brilliant and recognised for it. Often you’ll find it’s the result of your own planning and long hours of sacrifice combined with hard work.
The easiest way to instantly become a CEO is to start up your own business tomorrow. However as with anything that doesn’t necessarily mean you’ll be any good.
Ideally if you do become a CEO, you’d like to think that it’s because you’re the best candidate for the job. But that doesn’t guarantee success particularly in today’s world which is experiencing unprecedented disruption and change across all industries.
I think a more appropriate question is ‘What does it take to become a great CEO or a great leader?’
The answers to that question are very different to what they would have been five or even ten years ago. For the past 18 years I’ve worked with high performing leaders across fifty industries, many of whom are CEOs already or who were transitioning into the CEO role. One aspect they all have in common is change.
A time of VUCA
The rate of change and disruption happening in every industry is presenting major challenges for all leaders. We are now living in a time of VUCA which stands for Volatility, Uncertainty, Complexity and Ambiguity. As a result many leaders are experiencing extreme fatigue, high levels of stress and as a result, a lack of clarity on where best to put their focus.
The role of the CEO is changing because the kind of leadership required for success has changed.
The old model was one of 'command and control', a model from the industrial age. The new digital era is calling for something very different; a more adaptable, self-aware and dare I say ‘human’ model.
People are seeking more meaning, connection and engagement so the hierarchical and traditional approach to being a CEO and leader no longer works. Yet that approach is still the model that many of today’s leaders use.
As part of a recent survey in Fortune magazine featuring 402 chief executives from 11 countries CEOs whose companies together make up an estimated $2.6 trilllion in revenues were asked about leadership. 74pc said they were very comfortable with the practical parts of their job such as the ‘doing’.
However when it came to the less tangible parts of being an effective leader, the ‘being’ part of their role shared frustration emerges as a pattern.
Achieving the personal transformation required for leadership success is proving difficult for most. The survey also demonstrated nearly 48pc of people said that finding time for self-reflection is very challenging and most of the CEOs find the ‘human’ aspect of the role more difficult than expected.
In addition to this almost half (47pc) said that developing their senior leadership team was harder than anticipated with 50pc saying the same about driving real and lasting culture change.
From my own experience of working with CEOs in Ireland, the UK and the US I would have expected those figures to be even higher.
Dual Transformation Challenge
In the same survey, when asked if they needed the capacity to transform themselves in tandem with their organisation, an overwhelming 79pc agreed.
Most CEOs, regardless of company size, are busy and usually comfortable with the ‘doing’ part of the job, but the VUCA age is demanding much more from the ‘intangible’ areas of leadership - the ‘being’ side is where the real value is in the future.
I call this the area of ‘The Inner CEO’ and central to it are three essential skills for digital age CEOs: self-awareness, adaptability to change and actively managing their state around four key fitness areas: physical, emotional, mental and spirit/purpose.
Today, you could be a CEO rock-star at the cognitive level (mental fitness) but if you’re not developed at an emotional level it’s likely you will be lacking in some of the key leaderships skills needed for this time, and they could become serious blind-spots.
For example, good CEOs are typically strong on skills like strategic and tactical thinking but often they are lacking in the skills of really listening (to themselves and others), knowing when to speak and when to shut up and managing their emotional states. And it’s essential for the leaders of the future to develop The Inner CEO skill of inner clarity, especially when the path forwards may be less obvious.
So it’s critical that leaders take on the challenge of continuously developing themselves as leaders while at the same time developing their organisation. And this is something great leaders embrace and commit to.
Talent doesn’t usually leave companies. It leaves poor leaders. And I have seen this happen more often than I believe is necessary. So a key strategic focus for any board should be on the continuous development of the CEO.
This is key because if a CEO is not well versed in the human side of the role, they will fail in today’s world — and the implications of that failure will affect not just their own success, but that of all stakeholders — shareholders, employees, and customers alike.
I recently spoke to a group of about 50 successful Irish CEOs and entrepreneurs about elements of the inner game of leadership. What was interesting was the level of curiosity and interest around the subject. Not just for themselves but for the people working with them.
Five years ago, when I spoke about this approach to a similar group there was very little openness and even less vulnerability in being willing to admit that it was relevant to them.
But things are changing. People and leaders are more open to a new approach, primarily because the old approach isn’t working to the level they need.
"To be a CEO is a calling. You should not do it because it is a job. It is a calling, and you have got to be involved in it with your head, heart and hands. Your heart has got to be in the job; you have got to love what you do; it consumes you. And if you are not willing to get into the CEO job that way, there is no point getting into it." - Indra Nooyi, CEO and Chairwoman of PepsiCo
As Indra Nooyi says, your heart has to be in the job as well. And that isn’t just about passion. It’s also about caring for the people as well as the organisation, in a way that’s genuine. And that’s challenging. But the mark of a great CEO.
Shane Cradock is an experienced leadership coach and advisor. His event - ‘An Evening of Inspiration and Clarity’ takes place on the 3rd of October at the Talbot Hotel in Stillorgan, Co. Dublin.