Written by Elena Giel
Edited by Sam Eisen
A public company can be thought of as several different components that make up a whole. Traditionally, a company is composed of stockholders, employees, management, and a board of directors. The stockholders are the owners of the company, which gives them the power to elect the board of directors. It then rests on the board to put competent management into place. This includes the CEO or the chief executive officer.
In a small, private firm, the CEO is at the center of everything as noted by Stever Robbins in his novel Balancing Work and Sanity. He explains that “a CEO’s responsibilities [include] everything, especially in a startup. The CEO is responsible for the success or failure of the company. Operations, marketing, strategy, financing, creation of company culture, human resources, hiring, firing, compliance with safety regulations, sales, PR, etc.—it all falls on the CEO’s shoulders.” While this is most likely the case for all start up firms, is this also true for public firms?
Due to the complex structures of most publicly owned firms, specialization becomes vital. Firms almost always have a COO (operating) and a CFO (financial). From there it can expand to include anything the stockholders and directors feel is necessary to the firm, such as a CTO (technology), a CIO (information), a CCO (creative), a CRO (risk), or a CDO (diversity). Altogether, there are upwards of 60 such C-level positions that are considered the highest level of management within a firm. From there endless levels of delegation and titles ensue. Which begs the question: when everyone has specific skills and tasks to complete, what are the skills and tasks required for the CEO? Are they still responsible for the success or failure of the company or do they simply become a figure-head for the public?
I believe that this unique position is an inseparable mixture of both. Although other C-level positions are created to help the firm run smoothly, the CEO must possess specific skills necessary to accomplish those tasks. The CEO must be capable of setting strategy and vision for the company and its future. The ultimate direction of the firm, with the input of other executives and possibly stockholders or directors, is up to the CEO. Building a positive culture is one of the chief executive officer’s most vital roles. The atmosphere of a place is top down, meaning that attitudes trickle from the upper level management down to employees based on what the management values. If managers of a firm value getting ahead regardless of the consequences, then they will hire employees that also share such a philosophy and will reward them when they act in a way that fulfills this goal. The same can be said for the opposite scenario, as in a firm that does right by the community even if it costs the firm extra to do so. In the long run, companies will be better off because they will gain workers who will work hard to fulfill this vision, gaining the respect and trust of the community in the process.
There are drawbacks to all positions and CEO is no exception. If anything, they are in the most precarious position of anyone within the firm. They are the heart and soul of the firm, the face that everyone sees on the cover of a newspaper, and the voice that is heard speaking in the news. The Wall Street Journal puts it a similar way. It the article Moment of Truth for Windows Whiz by Shira Ovide, it is put plainly that “no matter how the world greets Microsoft Corp.’s next version of Windows, one man will receive most of the praise or blame: Steven Sinofsky”. While he is not yet the CEO, he is on a “shortlist of internal candidates to succeed Chief Executive Steve Ballmer”. These CEOs are in such a microscope that they fear disclosing even the most inescapable things, such as disease and cancer, for fear of appearing weak and losing control, as explained by Joann S. Lublin in her WSJ article When Executive has Cancer, Disclosure Becomes Trick
While it is a sad truth to face, it is impossible to be such an influential and motivational figure for your firm without also being just as present in the everyday lives of the public. Being a CEO can provide a wonderful opportunity to make a difference, to influence a corporate culture for the better by bringing in employees that care about the environment and the community in which they work while staying profitable and productive. It can also create deep holes that might have been completely out of your control or prevention, but still impact your career to the point of being fired or forced to resign over another’s mistakes. While this is far from what most would consider fair, isn’t it about right for a shot at fame, fortune, and massive influence on those around you?
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WSJ Monday, Oct 22nd 2012 – B1, Marketplace
WSJ Monday, Oct 15th 2012 – B1, Marketplace