The problem of growth
For all corporate leaders, there is a consensus about the problem of growth. Not only CEOs or Investors but also Governments are facing the growth question, even if from different perspectives.
One of the core issues of growth for top executives is the question of strategy and leadership and how to deal with his managers and employees to collectively demonstrate vision, insight and courage to deliver this growth. Really good leaders are few and far between.
I remember, that I read through a conversation last year with Koji Miyata, former CEO of Olympus, and Albert Reddihough, founder of KeyMed. Albert believed that you should take only managers who would make a good No. 1. And that the world is full of managers who would make a good No. 2, but those who would make a good No. 1 are few and far between. He pointed out, that rarely does a good No. 2 ever become a good No. 1, no matter how much knowledge and experience he or she might accumulate. So finding the right successor for the CEO is a matter of finding a good No. 1 and providing him or her with the appropriate training. If management fails to find a true No. 1 and settles for a No. 2 as CEO, the organization immediately begins to decline.
I liked that view and the reasons to think so. In his experience, the difference between a good No. 1 and a good No. 2 is, that the CEO is responsible for steering the company safely through even severe tempest. Running a company is not a job for the faint of heart. The CEO needs to be someone who can keep the company on the right course, who possesses the wisdom to recognize hazards and the fortitude to steer clear of danger. That wisdom and fortitude are the difference between a good No. 2 and a good No. 1. The good No. 1 will keep a steady hand on the wheel through any storm or even normal growth times. That is the most important consideration in choosing a good CEO.
So, also in my mindset, a winning company will be this that finds and develops outperforming leaders in an underperforming economy and so a No.1 CEO. In almost the last two decades, a double-digit growth was easy. Raising capital was easier and cheaper than in any other period in history, additionally globalization created access to new markets, innovation and financial services took value to new heights. To grow, all you had to do was doing nothing wrong.
During this time, almost no powerful new leaders came up. It’s very easy to understand, that a new middle management, which grew up in a pleasant environment, won’t possess the wisdom to recognize hazards and the fortitude to steer clear of danger.
Today, or let us start in 2008, we are still in a post-crisis era. In this era, every day changing market conditions are posing a set of circumstances different from anything in the past. Current challenges could persist for decades, creating a “new normal. Nowadays executives have to face, that in this “normal” growth is slow, but change is fast. The challenge for leaders is to open creativity to their teams to allow for decisions to be taken swiftly to create growth opportunities that far outstrips the potential of the global markets.
So today and in the near future, a good CEO should possess the wisdom, vision and fortitude to create a difference between his company and the competition.