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Every CEO I know has a unique story, but in all my years working as an executive and a consultant, I have seen many commonalities in their growth and career attainments. For business leaders who aspire to this pinnacle of business roles, I have to caution them to anticipate and prepare for both the great and not so positive aspects of the position.
I have never claimed to have a roadmap for aspiring CEOs, so I was happy to see the new book, “The Life Cycle Of A CEO,” by Claudius Hildebrand and Robert Stark. These authors have spent their whole career interviewing and compiling data on hundreds of CEOs, both successful and failing, to develop a roadmap, encompassing the five key stages of a satisfying CEO tenure.
I would like to share here a summary of these stages, supplemented by my own insights. I’m confident that this roadmap will help all of you as leaders, professionals, and executives who are preparing to be CEOs, or just want to work more effectively with your current CEO. I’m sure you recognize that individuals have widely varying experiences that impact the timing of each stage:
1. The first-year learning about the job (Launch). Mastering the challenges of the Launch stage requires great agility with both/and thinking. You must learn to navigate both near-term issues and longer-term matters, internally and externally. In this stage, practicing the arts of observation and listening is crucial. Attack only low-hanging-fruit challenges.
2. All stakeholders reassess performance (Calibration). Initial exuberance about your performance may now be reversed, or early moves are not yet producing anticipated results. Avoid over-reliance on past experience, which may trigger confirmation or other biases. Watch out for that first crisis you didn’t anticipate, likely arriving during this stage.
3. Early moves begin to show real results (Reinvention). You need strong results by year three to build trust, both inside and outside the firm. This will give you more latitude to take actions that might not be positively perceived by the market, or the board needs convincing. It is also time for you to grapple with how long you want to stay in this role.
4. Performance flattens or stagnates (Complacency trap). Your challenge in years six to ten is to stay vigilant and keep pushing change and growth while also watching out for storms brewing. Beware of the dangers of the status quo bias and continue to find ways to broaden yourself and your business. Don’t ever get too comfortable in your position.
5. Ensure a successful transition of power (Legacy). Here your challenge is to manage the feat of continuing to vigorously drive the company’s growth while preparing for departure. Don’t be tempted to stay past the optimal time for your exit, and start early grooming a successor and smoothing the transition. Catalyze a new cycle of innovation.
These stages as outlined here are focused primarily on public company CEOs. In fact, the stages for a new-venture CEO or a private-equity-managed company may be substantially different in timing, but the basic principles still apply. In all cases, I find that people skills and influencing are becoming more and more important in the selection process and probability of long-term success.
In my experience, leaders today with highly specialized skills, including technology and finance, need to broaden their base by first taking roles in executive management through C-suite roles, such as COO, CFO, CMO. Advanced degrees and more formal education are not a prerequisite.
Another key focus should be building relationships with people who can help and mentor you, including members of your current executive team. Make sure you have an understanding of the entire business, and don’t hesitate to volunteer for new company-wide initiatives, such as the rollout of business process sustainability or reengineering efforts.
All businesses today are in the midst of unprecedented change, with new opportunities abounding from instant global communication and new technologies such as artificial intelligence and electric vehicles. We need all of you as members of a new generation of CEOs who can thrive and survive in this new and chaotic world.
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