The CEO’s Dilemma: Balancing Strategic and Tactical Responsibilities
You could call it “the CEO’s dilemma.” Corporate executives strike a delicate balance between the business visionary, the great closer, and the operations manager. The challenges CEOs now face are certainly changing and becoming much more difficult to carry out successfully. The New Year has ushered the global business community into a new decade full of promise and full of opportunity, but still fraught with dangerous economic challenges and increasing regulatory complexities. Having a solid strategy is no longer enough. CEOs must shape their companies to be highly agile, run lean, and have highly trained employees at all levels of the organization. This article defines the CEO conundrum, explores the opportunity it provides, and offers three pieces of advice CEOs will want to read.
A recent article in the Wall Street Journal article by Cari Tuna titled “Balancing Supervisory Work with Overdoing it” discussed how CEOs have to be more “practical” during the economic downturn, almost risking micromanaging. Increasingly, CEOs are engaging in details typically left to the VP of Operations and VP of Sales, stepping in to help close big deals and obsessing over budgeting and cash management. The demanding pace and attention to detail is required because companies cannot afford to take any wrong steps, especially at this time. Hence the conundrum for CEOs … staying strategic while being tactical. Certainly, the strategic momentum, and therefore the competitive advantages that the company enjoys, will ultimately suffer if the pendulum swings too far towards the tactical details of running the company.
What can be done to achieve balance?
Strategy and vision cannot be sacrificed to achieve operational excellence. Both can and usually do coexist, but companies risk losing a competitive advantage when the top executive is forced to focus too much on the day-to-day and cannot plan for what is beyond the horizon. Strategic positioning requires careful planning with top-down timing that involves all managers and employees in the organization.
The three things CEOs should do:
Let’s cut it all down to three verbs that are essential ingredients for the winning organizational formula that will return top executives to control to balance strategic and tactical engagement.
Authorize
Part of the solution begins with creating organizational structures that empower informed employees with the freedom to make broader decisions at the line level. Stronger line-level managers and employees benefit the entire organization and help get executive management out of the minutiae. How this is accomplished starts at the top, with well-constructed strategic plans that are concisely related to operational budgets that drive implementation tactics. With the right management controls in place, this approach enables those closest to the action to respond more quickly when needed, always operating within predefined time frames and in support of strategic objectives. Goals are well known and understood by empowered employees, as their direct managers will have effectively communicated these goals to them, accompanied by expectations of how they can contribute directly, allowing them to embrace the vision and participate in tactical execution.
Communicate
Strategy is formulated at the top, and the CEO is directly responsible for setting the direction and process for strategic and operational planning to unfold effectively. As mentioned in the previous section, communicating the goals of the plan is a very important part of that process. One approach to consider in the overall communication strategy is to translate the goals of the plan into strategy statements that the organization can adopt and enact. The ultimate goal is to effectively spread executive vision more effectively across all ranks, so that empowered employees are motivated to help your organization. As with business strategy, communication of business objectives must be carefully planned and well orchestrated to achieve intended results. As José Palomino explains in his book “Value Prop”, we are already a society with excessive messages, so communication must direct the correct messages to the right people in the organization at the time they need to receive the message.
Along with the strategy statements, employees should receive the equivalent of mini-marketing presentations that relate the value to be delivered by achieving each plan objective. They must understand how they contribute to the bigger picture and the consequences of goal achievement or mission failure.
Reward
Once employees are trained to act and understand the strategic objectives of the organization in relation to their roles, it is their turn to act. At this point, it is also the management’s turn to supervise, facilitate, correct and reward. Organizations that are equipped with measurable plan goals are well positioned to effectively manage performance and reward achievement. The added ingredients for success are a strong culture and job responsibilities that converge with budget controls and reward actions taken in the best interest of the organization.
In conclusion
Business leaders can’t do everything. They need organizations below them that can carry out the mission. Corporate executives have always had responsibility for developing business strategy, but strategy execution must be entrusted to talented, knowledgeable, and motivated employees. Strategy and planning that empower employees at the lowest possible level through aligned budget parameters and reward systems will build a stronger culture and a more successful company. It will also allow the CEO to set the rails and then put the wheels of the organization in motion.
