What’s an executive?
First, we need to find an executive. You can often spot an executive by her title. In industries like banking, title inflation has made everyone a vice president, but here I’m talking about real VPs, not the ones who took an impressive title when they could have asked for a raise instead.
“Chiefs” are special. Their titles imply specialty—CFO is finance, CMO is marketing, COO is operations—but that just describes their expertise, not their scope. Their job is making decisions from the perspective of the entire business. They think about making the entire business succeed, not just their own domain. You know that grand vision statement the company wrote last month? It’s the chiefs who link the leadership vision with the strategy and tactics that get carried out.
Vice presidents should also be striving for global thinking, but they’re more specialized. They often come in many flavors—VP of Northeast Sales, VP of Human Resources, VP of Quality, VP of Customer Service, etc. VPs are accountable first for their area, and then for the business as a whole. But they’re still executives, at least with respect to their area.
Executives must think vertically
People generally rise from the bottom to become executives. They have experience at every level of the business. They know the issues, goals, and concerns of front-line workers, managers, regional managers, and directors. If they paid attention along the way, this makes them uniquely qualified to think up and down with their decisions.
It’s Monday morning, and an eager young intern suggests, “Let’s take our squeegee brushes and bundle them with free eyeglasses. It’ll be the biggest promotion ever!” The VP can consider the suggestion at every level: Does this idea fit with the strategy? Does this idea make sense given the director-level org chart? Will it work in manufacturing?
The VP’s job isn’t to answer these questions, however, even if she knows the answer. The VP’s job is to raise the questions with the right people so everyone at the appropriate levels does the in-depth analysis required to know if the idea makes sense.
In this way, the VP is doing her real job: building the organization. At lower levels of a business, everyone’s delivering a product or service. It could be the new Mach 9 Razor (now with seven diamond-coated blades), or the Faster than Light Package Delivery Service (packages delivered the day before you mailed them). At the executive level, that changes. The deliverable is not a Mach 9 Razor; it’s a business that delivers a Mach 9 Razor. The distinction is subtle but crucial.
The executive’s job is hiring the right people, asking them the right questions, and engaging them the right way during decision making. That’s why the VPs who think at all levels are so effective; they can spot opportunities throughout the business, and help the right people at the right level pursue them. Those people learn, and can spot the next opportunity on their own. Developing people and systems, now that’s building a business, not just building a product.
Executives who rise too fast or didn’t learn along the way often get stuck at one level. Some VPs think only at 50,000 feet. Their big picture thinking is great, but their strategy doesn’t capitalize on the actual strengths of the organization. They don’t know how to connect strategy with operations. Their strategies can range from completely unrealistic to merely a bad fit. And beware the 50,000-foot thinker with Attention Deficit Disorder! Every day brings a new initiative, any one of which would occupy the entire division for a year. Life with them is exciting and fast-paced, but somehow, not much progress comes from all that sound and fury.
Other VPs are stuck at 5 feet. While I was helping a finance company’s senior team plan a strategy, one VP mentioned, “the customer service input screen needs a ‘back’ button.” That may be true, but it’s out of place when discussing fifteen-year industry trends. VPs mired in details micro-manage, and usually do it poorly. When they appear on the scene, everyone rolls their eyes, smiles fake smiles, and waits patiently to start cleaning up the mess when they leave. Their contribution to the business? Less than zero. They don’t help at the top and they muck things up at the bottom.
Executives must think horizontally
Executives have entire functions or business units reporting to them. It’s the executive’s job to recognize how everything interacts and make sure those handoffs happen as they should.
In a start-up, everyone sits in one room. The product designers are three feet away from the people doing the invoices, and all of them gather in the storeroom every afternoon to manufacture that day’s batch of product. Everyone hears customer complaints. Everyone hears internal issues. And everyone can work out who needs to hand off what to whom and when.
Good executives think long term, short term, and every term in between.
But as the business grows, the tasks get too big for one person to handle; now ten people take calls in a call center. They’ve never met the designers, and don’t know what happens with the complaints they so dutifully record. Each customer service rep now does a tiny slice of the original one-person job.
As businesses grow, tasks grow. As tasks grow, any given job is a much smaller slice of the task. As jobs shrink, we need systems to link people, paper, and process so that everything gets done. Executives are the only people in the right place in the organization to identify all the different pieces and make sure the links happen.
Executives must think through time
The most critical decisions in a business are where to spend the limited reserves of time, energy, and money. Since executives are the ultimate deciders about their area’s resources, how they direct people and dollars determines the fate of the company.
A front-line salesperson in a retail store needs only to think as far ahead as helping the customer select an outfit. Total attention span? Five minutes for the customer interaction. A middle manager might be in charge of a project that takes several months to complete, or even a couple of years. Converting 500 outlet stores to a new automated point-of-sale system doesn’t happen overnight. The middle manager needs to make decisions balancing the emergencies of today with the need to move the multi-year project forward.
Good executives think long term, short term, and every term in between. As company stewards, they make decisions considering the effects on the short-term environment, all the way out to the long-term implications.
Many attractive short-term decisions become bad decisions years later. In many cases, this could be predicted in advance. Layoffs became a fad in the late 1980s’ LBO craze. They produced (and still produce) short-term gain. But long term, they destroy trust and create a workforce that rightly feels very little loyalty to employers.
Start thinking now!
Success as an executive requires the ability to move freely from strategy to tactics, the ability to understand linkages across organizational boundaries, and the ability to balance short- and long-term concerns. Whether or not you’ve made it to the top of your game, start cultivating this flexibility and you’ll be a prime candidate for the C-suite