A Chief Executive Officer (CEO) holds the most senior position within an organisation and is responsible for the overall operational and financial performance of the business. The CEO is in charge of resource allocation and is the company’s point of contact for shareholders and the board of Directors.
CEO’s are the public face of the company, which is why some new CEO appointments can have both positive and negative impacts on a company’s profile and evaluation. For example, a well known, successful CEO such as Elon Musk, would dramatically increase the profile and valuation of a company. Appointing a CEO is therefore a very considered decision.
The role of a CEO varies from one company to another depending on the company’s size, culture, and corporate structure. In large corporations, CEOs typically deal only with very high-level strategic decisions and those that direct the company’s overall growth. In smaller companies, CEOs often are more hands-on and involved with day-to-day functions. CEOs can set the tone, vision, and sometimes the culture of their organizations.
Because of their frequent dealings with the public, sometimes the chief executive officers of large corporations become famous. Mark Zuckerberg, the CEO of Facebook, for example, is a household name today. Similarly, Steve Jobs, founder and CEO of Apple, became such a global icon that following his death in 2011, an explosion of documentary films about him emerged.
On a day to day basis, typically roles reporting to the CEO include the Chief Financial Officer (CFO), the Chief Operations Officer (COO), the CTO (Chief Technology officer), the Sales Director and the Chief Marketing Officer (CMO).
On a regular week, the CEO will hold scheduled meetings with these reports to monitor and input on the week by week performance of the company. In larger organisations, this might be a less frequent occurrence, for example, monthly or even quarterly.
The CEO is often asked to provide comments for PR purposes, and even feature in company related news and articles published by third-party news outlets. The CEO is often the go-to spokesperson for internal and external events and has a tendency to distribute important company updates to the organisation and stakeholders.
CEO’s can have a significant impact on the company’s culture, profile, motivation and direction of a company, and so it’s vital that a new CEO appointment fits with the ambitions, values and beliefs of an organisation.
CEO’s have a responsibility for protecting a company’s image and so often are involved in decisions relating to cyber security policies, high-spend marketing initiatives, legal policies and PR.
All things considered, the CEO’s primary role is set a company’s strategy and vision. The senior management team can help develop strategy. Investors can approve a business plan. The Board can approve, advise, or ask the CEO to revise a business strategy. But at the end of the day, it’s the CEO who ultimately sets the direction:
- Which markets will the company enter? Against which competitors?
- What will the company’s product lines be?
- How will the company differentiate itself? Will it be low cost? High service? Convenient Locations? Flexible financing? High-touch? Mass produced?