Analysts are concerned whether the CEOs getting large salary are worth it or not. CEOs earned an average annual salary of $11 million in 2010, with pay soaring by an average of 23 percent last year, according to research released by the AFL-CIO in April.
Prof. Linda Henman, an expert in organizational systems for more than 30 years, who has helped military organizations, family owned businesses, and Fortune 500 companies, says: “Those at the top have three major responsibilities: Develop the business, grow talent, and make decisions that drive innovation.”
Author of Landing in the Executive Chair: How to Excel in the Hot Seat, Henman explains: “Boards often don’t make wise decisions about CEOs and CFOs, and these executives, in turn, don’t make wise hiring decisions throughout the enterprise. But if leaders do a better
job, companies can do a better job, which means individuals can do a better job. These leaders create companies where customers want to do business and people can do their best work. That all leads to financial health on the micro level which translates better financial health for the country. That’s why I think it’s important for people to understand if their CEO evidences the ability to soar above the competition, because in the end, only the strong will survive.”
The top qualities of a good CEO, according to Henman, include:
* Strategy – Strong strategic thinking defines the effective CEO. These leaders understand how to match a strong strategy with the tactics and talent to see it through. CEOS who constantly react to events, instead of planning for the future, remain followers and not leaders.
* Decisions – When CEOs consistently make good decisions, little else matters; when they make bad decisions, nothing else matters. Even though decisiveness distinguishes leaders from everyone else, effective decision-making stands at the center of executive leadership. A decisive CEO who can’t hit the target is the same as an indecisive CEO who doesn’t even know where to find it. The results are the same.
* Hiring – Successful CEOs know how to tie talent to their strategies so they ensures the company hires the best and the brightest and compensates them fairly. Moreover, they give these people a chance to thrive.
* Excellence – Leaders who attract and retain top talent stress excellence. They focus on good execution of plans and strategies, and they don’t skew the mission by placing value on tertiary issues that have little to do with execution of strategic goals.
* Results Orientation – Too many executives talk about how to motivate the troops. Those who excel in the hot seat do better. They hire people who are self-motivated, define clear objectives, hold people accountable, and then they get out of the way. Couple these practices with challenging, rewarding work, and the organization ends up with both better results and motivated employees.
“It all comes down to leadership, as opposed to management,” Henman added. “Managers come in all different flavors: good, bad, neutral, ineffective, overbearing, innocuous, and more. But true leaders, by definition, move people to perform at levels that allow them to beat the competition. Moreover, leadership doesn’t necessarily come with a title or a status. Responsibility and accountability come with that title, but leading requires the ability to take people to places they wouldn’t have gone if you hadn’t been in the picture. Leaders who possess this ability offer golden opportunities for their organizations and the people who work in them; those who don’t simply hope for a good golden parachute.”