Hook & Bait

How do you keep your job as CEO?

Worrier asks

How does a CEO cope with the constant worry of how to keep the job? What are the main points to consider?

Marten Mickos

A CEO's job is to produce results. The desired results, defined by the board of directors, can be revenue and market share growth, profitability and cash flow, long-term sustainable advantage, and so on.

To produce those results, the CEO tries to put the company's resources (employees, cash, machinery, etc.) into the best possible use in serving customers. CEOs do that by making decisions, by negotiating deals, and by communicating (i.e. influencing and inspiring).

So if you are worried about keeping your job as CEO, you must be worried about your ability to do what I outlined above. If you know where you are weak, you can study, learn and improve your skills.

Let's look at reasons why CEOs get replaced. The main reason is that the board does not believe that the CEO can produce the desired results. Sometimes the board has unreasonable expectations. Sometimes it is because the CEO is afraid of making a bold decision.

Intel's past CEO Andy Grove has a great example. Intel was producing memory chips and thinking about producing processors. This was in 1985. The management team got together for a strategy discussion. Andy Grove gave them a mental task: "Imagine that we all get fired today, and a new CEO with a new management team will start tomorrow. What will that new team decide?" After some deliberation, they concluded that a new team would abandon memory and bet everything on CPUs. The CEO then said "OK, so let *US* make that decision. Let ourselves be the new management team, because if we aren't, we will soon be fired." This was a great way of finding clarity in a highly complex and difficult decision-making situation.

You can use the same technique in a small startup. Think of some really good CEO of another company, and imagine that this person would become CEO of your company. What would she or he do? The answer may be what *YOU* should do.

Another reason that CEOs get fired is that they are unable to lead the troops. If the management team is complaining and company culture is deteriorating, a new CEO may be needed. The learning here is: to avoid being fired, make sure you lead your team well.

If you do end losing your CEO job, remember that getting fired often is a necessary growth experience. You will come back stronger.

 


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