What Does A Chief Executive Officer (CEO) Do?

Now more than ever, the expectations of CEOs and senior leaders are immense. They are being called on to address complex challenges and lead significant change, predominately the result of a global pandemic but also the impact of record low unemployment and economic pressures. Adapting to this rapid transformation means that the role of the CEO has in fact changed. And so to have the right mindsets and practices that will lead to success.

Here is a guide to navigating the role of today’s CEO and the resulting skills and competencies that are being prioritised in CEO selection.

The role of a CEO (Chief Executive Officer) varies depending on a number of factors such as a company’s size, its organisational structure, ownership model, and industry context.

Broadly speaking, a CEOs role and responsibilities are focused on setting strategy, aligning an organisation, leadership and culture. For smaller businesses, the role may also be more hands-on with specific day-to-day operational accountabilities. Whereas for larger organisations, it could also include being the public face of the company and leading stakeholder engagement.

One approach to defining the role of the CEO is to understand what activities, tasks and priorities they spend their time on.

A landmark study published in 2018 in business magazine HBR examined CEO time-use in large, complex companies over an extended period. The research was often referenced as a guide to best practice time management as well as offering an insight into the focus or purpose of the CEO role – strategy, structure, culture, process, people and relationships.

More recently, an article in Forbes reflected on the behaviours of CEOs of some of the most profitable companies in the world (which they termed ‘digital-era CEOs’) and determined that the jobs performed by these CEOs are vastly different to those included in the HBR study (referenced as ‘industrial-era CEOs’), as outlined in the table below.

Source: Forbes – Why CEOs Need a Job Description

The key takeaway from the contrasting picture above is the importance of having a clear and accurate CEO position description which is linked directly to an organisation’s vision and mission. For guidance on creating a well-written position description, check out our best practice guide.

As well as an evolving view of the role itself, we’re witnessing a shift in the characteristics and competencies required of leaders in order to meet the expectations and standards placed on the role. This of course is nothing new.

Throughout history, we’ve had an ever-changing view of what “good” leadership looks like. The challenge we have now however is the unprecedented pace of change and the need to constantly rethink and reimagine what the future of business will look like, and therefore, the leadership model that will deliver the best chance of success.

One silver lining to all of this progress and advancement is the array of sophisticated assessment tools currently available that help us determine the ideal skill set and mindset required of leaders relative to organisational needs.

Just like your business is unique, so too are the qualities and competencies required of your organisation’s leaders. While different roles (and organisations) dictate different criteria, there are some in-demand traits that are proven indicators of leadership success.

Here’s a summary of insights from current market intelligence:

• McKinsey and Company studied performance data to determine what distinguishes “excellent” CEOs based on 18 areas of responsibility. It’s a fairly detailed model that also includes an assessment guide to help CEOs rate their practices based on their mindset.
• In a recent Forbes article, they proposed a more digestible approach by outlining eight key qualities of a “good” CEO which includes: strong leadership skills, strategic thinking, adaptability, strong communication skills, decisiveness, strong integrity and ethics, emotional intelligence, and resilience.
• The World Economic Forum published a slightly different approach, suggesting that successful leaders are masters of eight competing competencies – sets of psychometric traits that typically would be at odds with each other. This includes being disruptive and pragmatic, risk-taking and reluctant, heroic and vulnerable, galvanizing and connecting.

As a leading executive search firm operating throughout Australasia, Decipher Group work with a range of organisations, sourcing and securing highly qualified senior leaders. We’re uniquely placed to offer our clients deep ‘real-time’ insights into talent markets – we work with organisations to determine the type of leader they need to achieve their goals, while also having our finger on the pulse of the traits, values and beliefs typified by today’s executive candidates.

While there are certain qualities that most successful CEOs share, what we’re currently seeing is a new generation of leaders who are embodying the following attributes.

1. Collaborative and connected – They anticipate and plan for possibilities while surrounding themselves with a strong, supportive community. Reputation, credibility, and trust are key.
2. Confidence and gravitas – Their executive presence demonstrates capability and reliability but it’s a confidence driven by humility, excellent communication skills, positivity, and optimism.
3. People-focused before task-focused – They model the right mindsets and behaviours and focus on building high-performing teams.
4. Self-awareness and accountability – Highly effective leaders know that creativity and innovation mean embracing mistakes, missteps, and disappointments. Treating ‘failure’ as learning opportunities.
5. And importantly, they take action and consistently deliver results.

Decipher Group are industry experts in the recruitment of executive, c-suite level professionals, and governance leaders for New Zealand and Australian businesses. We’ve been connecting talented people to exciting opportunities for 15 years. Let’s talk.

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A short Q&A with our team on related questions that people commonly search for on Google.

The role of a CEO is the most senior executive position in an organisation with ultimate accountability for its performance and results. While it is a role comprising many varied tasks and responsibilities, the core function is setting and executing organisational strategy.

CEO compensation is set by a company’s board of directors and is typically reflective of overall organisational performance as well as benchmarking relative to market demands and industry peers.

Remuneration has several components and can include base salary, cash bonuses, stock options, performance-based equity, as well as other non-financial benefits.

CEO compensation can vary widely depending on the company, industry, and size or scale of an organisation. According to research from the University of Otago, CEOs are now paid 30 to 50 times more than the average wage, with over half of New Zealand Chief Executives earning at least half a million dollars. By comparison, the average CEO pay for the top NZX-listed companies was $2.29 million in 2022.

A business founder or owner may at some stage also hold the role of CEO within the company. A CEO is typically the highest-ranking executive role responsible for providing leadership and strategic direction to an organisation.

An owner, founder, part-owner, or shareholder has a financial stake in a business, and may or may not be actively involved in the company’s management. However, over time it is likely that you won’t be working ‘inside’ a business’s operations but rather focus on the entity as an investment, possibly with a position on the board of directors. At this point, you would assign organisational leadership to a CEO or General Manager.