When the time comes to bring on a new CEO to breathe a sense of renewed life into an aging organization, you’ll need to determine your primary objectives and find someone capable of executing them.
CEOs, like all people, have different strengths and weaknesses, so selecting one whose strengths align with your organizational goals is vital.
Typically, companies have one of five goals: bringing new products to market, streamlining finances or operations, growing revenue, improving the customer experience, or scaling a startup business for the future.
They’ll need to find people with the appropriate expertise and skill set to deliver results to meet their specific objectives.
In the following article, we’ll explain the various types of CEOs and the strengths and weaknesses they’ll bring to your company.
Companies in the tech sector usually benefit from product-focused or engineering-oriented CEOs with significant experience developing software or other tech products. Such a background helps these types of CEOs understand the particular product in development, and they are usually adept at sourcing qualified engineering teams who can make that product a success.
An organization that doesn’t yet have a product, or is redesigning an existing one, will benefit from the technical prowess these CEOs can offer. They can establish a product roadmap that forecasts the development of the product and the company’s future vision.
Companies that struggle to find qualified talent will undoubtedly benefit from their network, but thankfully, a product and engineering CEO will usually have plenty of contacts, which means that they’ll be able to bring on others who they feel will be valuable to developing the final product.
However, not all product and engineering CEOs have the management skills to lead an organization; in fact, that’s often their major shortcoming. Many product and engineering CEOs spend much of their career working independently on specific products, not actively leading teams, so they may struggle to implement the company’s vision and have difficulty connecting with other key leadership staff and their teams. The CEO must remember that the product is only one part of the organization; other teams are critical, too.
With all of that in mind, if you’re looking for a new product or engineering CEO, you must carefully evaluate their management skills before bringing them on board. If they lack certain attributes, they may benefit from management training as they take the leadership reins of the organization.
Typically, finance and operations-oriented CEOs start their careers in key finance positions and gradually take on more leadership responsibilities, so when it comes time to run an organization, they have the financial acumen to handle the job. They’re the best fit for organizations that have grown quickly and thus need streamlining to improve their efficiency.
A finance and operations-oriented CEO is also beneficial for companies that are facing distress. If revenue is declining and groups aren’t working collaboratively, a finance-oriented CEO can identify the problems at hand and implement the appropriate processes to fix them.
However, some finance and operations CEOs may struggle to comprehend the company’s products, especially in the tech sector. If the CEO doesn’t understand the organization’s products, they may benefit from another advisor who can oversee the technical and engineering aspects of the organization.
In some cases, bringing on a CEO without C-level experience can deliver effective results, such as with a General Division Manager, who typically has experience running specific sectors of a large-scale enterprise. For instance, they may oversee the operations of one product area or a particular region of the organization.
The benefits that a General Division Manager brings to the CEO role are management skills on a smaller scale. They’re familiar with all areas of the organization, including marketing, sales, and finance. A General Division Manager is also enthusiastic, often excited to take on a more prominent role overseeing the entire organization’s operations.
However, before hiring a General Division Manager as your next CEO, it is critical to understand their successes in their old role. Sometimes, their achievements occur in part due to other team members, not necessarily themselves.
A marketing CEO’s prior experience is usually in sales, commerce, and customer service. They’ll benefit companies that want to grow their client base or improve customer retention. Usually, there’s already a solid product, but there may be challenges in obtaining new clients or growing the revenue base.
The marketing CEO’s typical weakness is a lack of product understanding, especially in tech-oriented companies, and financial unawareness. They may not have experience monitoring budgets or implementing operational efficiency measures. As such, companies that need a sales-focused CEO should look for experienced marketing leaders with experience in finance and operations.
A founder CEO has experience running an organization throughout its entire journey, from startup to scale. They’ll often have an inspirational and innovative leadership style, which is advantageous to grow companies in their early stages. Founders can also hold extensive experience in different areas, including finance, operations, marketing, and sales.
However, a founder CEO’s success running their own business isn’t necessarily a sign of the same outcome for another in a different market sector. In addition, they may not have the organizational expertise to run a company’s daily business operations.
To determine whether a founder CEO is right for your organization, consider their experience and previous successes. If they’ve been thriving in various endeavors, not just one, they’re more likely to benefit your organization. You should also evaluate whether they’ve undergone executive coaching.
While there are five basic types of CEOs, the experience of each can vary widely, and not all CEO types will exhibit the same traits. You’ll need to determine what you’re seeking to achieve with your new CEO and start your search accordingly.
For instance, if you’re seeking to enhance your revenue, a marketing-based CEO can implement a sales strategy to accomplish that objective, but you’ll need to be careful to choose someone with experience in operations and finance.
Sometimes, hiring several executives that complement one another achieves the best results. For instance, a product-oriented CEO can implement a solid product roadmap, while a CFO or COO can concentrate on the financials and operations of the business. Carefully evaluate each potential CEO to determine how their skill sets can benefit the organization before finalizing a hire.
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