In today’s economy, CEOs are often viewed as the charismatic superstars who almost single-handedly change the fate of even the largest organisations. CEOs like Akbar Al Baker (Qatar Airways), Tim Cook (Apple), Hatem Dowidar (Etisalat), Elon Musk (Tesla), or Amin H. Nasser (Saudi Aramco) have almost become household names. But is the CEO really the only person that matters for success in an organisation? Should company success be attributed to the individual at the top?
In this piece we argue that the idea of the CEO as the sole hero is a fundamental misconception that misses how the strongest CEOs achieve success in organisations namely by surrounding themselves with a team which is equally strong. Because running a company is a team sport, even with a superstar at the top, the company is only as good as the team that works with the CEO.
Cases which demonstrate that principle abound across most fields of life. Look, for instance, at the recent performance and outcomes at the EURO 2020, which was held in 2021 due to COVID-19 pandemic. The Portuguese team was one of the favorites, with much hope and attention on Cristiano Ronaldo, probably the best individual player in the world, as team captain leading the team. But something went wrong and even Ronaldo was unable to shoot Portugal to success.
“The strongest CEOs spend time on grooming multiple possible successors”
The same often happens in organisations when a CEO surrounds himself with a mediocre management team. On the other hand, the Italian team, with many young players, and some almost old ones for such a competition and with practically no renown world class star won the championship. What struck was that the entire team, including the reserve players, came in to save the day when needed.
The whole is greater than the sum of its parts
Also, visionaries require trusted advisors. One can think of a strong management team as the extended eyes, ears, hands, and legs of the CEO. The best CEOs are often brilliant visionaries, strategists that have insights into industry evolution years before others. Just like Sheikh Rashid Bin Saeed Al Maktoum, the former ruler of Dubai who foresaw the need to prepare Dubai for a world after oil, such CEOs often see the road to the future before others.
However, even the most brilliant CEO cannot develop a winning strategy and vision without trusted advisors that are loyal to the leader and are capable of providing insights, ideas, and sometimes even constructively challenge the emerging strategy. Too many weak CEOs do not accept being challenged and therefore remain constrained in their ideas and thinking, in particular in times of unprecedented change as today.
When the head alone is not enough to make a full body function. The role of the top management team in developing visions and strategic plans is essential, but even more important is the role of their role in being the loyal hands and legs that enable strategy implementation. To drive successful change in an organisation requires dedicated and coordinated effort. Strong top management teams play an essential role in guiding the organisation to implement the CEOs vision and plans and turn them into reality. Without the effort of the top management team even the best-thought-out plans can fail miserably in the mud of corporate inertia unless a strong coalition of senior managers support the change and go beyond the call of duty to multiply the CEOs effort.
Seeing inside the organisation. Management teams can also work as the eyes and ears of the CEO. Without these additional eyes and ears, even the most capable CEO runs the risk of becoming isolated from what is happening throughout the organisation and unable to respond to changes in the marketplace. To do so requires that enough senior managers, also beyond the top management team, are onboard and committed to the success of the organisation and its leader.
Ensuring success beyond the leader’s tenure. Finally, and probably most uncomfortable for many CEOs, a successful corporation also needs to maintain the capability to continue success beyond the tenure of the current CEO. The strongest CEOs therefore spend time on grooming multiple possible successors for the time when they will no longer lead the corporation.
What should a strong management team look like?
To build strong top management teams CEOs need to keep three principles in mind. First, to function as the CEOs extended eyes, ears, brain, hands, and legs, the top team needs to have very diverse skills, experience, and maybe even views. CEOs therefore should hire based on the needed skills rather than comfort factors such as nationality, tribe, or personal relationships.
A second principle for building strong management teams is that the members should be willing and able to engage in critical dissent and debate. As Ray Dalio, the founder of the hedge fund Bridgewater Associates often argues, to learn the truth, CEOs need to listen to those who disagree with them rather than to those who simple repeat what the CEO says.
Third, strong management teams require strong personalities that have the mental independence, energy, and strength of personality to drive the business without supervision.
Concluding thoughts
The CEO is no doubt the one who carries most responsibilities in an organisation. However, when the CEO collects a strong team in his corner, the burden can be better shared across more capable individuals, it can be better carried and more easily converted into positive energy and knowledge which will power the organisation. When the CEO is surrounded by a good team, where each individual plays the team game, performance is more likely to follow.
Article by Thomas Keil and Marianna Zangrillo, co-authors of The Next CEO: Board and CEO Perspectives for Successful CEO Succession published by Routledge, priced £29.99, available from Amazon and leading international booksellers.