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The role of a CEO and why should consultants target CEOs
HomeStrategyThe role of a CEO and why should consultants target CEOs
The Role of a CEO and Why Should Consultants Target CEOs
What is the role of a CEO and why should consultants target CEOs? It’s important to understand the difference between consultants targeting a CEO and targeting someone like the Chief Operating Officer, the head of Strategy, the Chief Marketing Officer, or even a divisional vice president. The differences are quite profound.
The role of a CEO
At the most fundamental level, the role of a CEO is to oversee everything that has an impact on the organizational health and performance of a company. A CEO has the authority to tackle any issue while the EVPs and other executives focus on their narrow domain of authority. The CEO can look at the work the CFO is doing, the work that the Chief Marketing Officer is doing, the work that the Executive VP of Beverage is doing, and what the Executive Vice President of Snacks is doing. The CEO has purview over everything and anything that, at that point in time and for the foreseeable future, has an impact on the organizational health and performance of the company. The point is, the role of a CEO is to wear many hats.
When you think about the role of CEO, you need to think about “what kind of consulting partner are you?” Are you a partner who can only discuss operations? Are you a strategy partner?
If you work for a large consulting firm, and the CEO’s pressing issue happens to be operations and you are a strategy partner, then you can rope in an operations partner to talk to the CEO. That’s the way it works.
If you’re part of a smaller organization and you’re an operations person and the CEO wants to talk about strategy, then you have to improve your skills to discuss strategy, or the CEO is likely never going to want to talk to you.
So let’s assume we know this company has a massive growth problem. They just can’t grow. If you go see the Chief Marketing Officer, you could conceivably have the best plan to get this company to grow. But there are problems you’re going to face:
The Chief Marketing Officer doesn’t have the mandate to discuss growth at the corporate level. And while you may have the best presentation, you may not get very far with the Chief Marketing Officer.
Maybe they don’t have the respect of the CEO to introduce you to the CEO.
Maybe they aren’t sure if it will work because the Chief Marketing Officer just cannot assess the quality of your thinking, and is therefore hesitant to present you to the CEO.
The Chief Marketing Officer may not even understand what you are presenting.
Or the Chief Marketing Officer may be more interested in his or her domain only and wants to talk about that.
So when you are trying to build relationships at this level, and sell your consulting services, you generally need to take the broad company issue and understand how it impacts their domain. But it is almost impossible to discuss broad company issues because it’s not the purview of the Chief Marketing Officer.
So, the point is that discussing vital strategy issues with the Chief Marketing Officer can very well be unhelpful.
Hoping to get an introduction to the CEO
And we’ve seen this many times where as consulting partners we would go talk to a junior, at least relatively junior compared to the CEO, level executive, hoping to spark some interest and get an introduction to the CEO. It usually doesn’t really work that way.
You have to be wary of talking to junior-level executives, relatively junior, of course, or even to senior-level executives, hoping to get the introduction to the CEO.
And there’s a reason for that.
While the CEO is generally worried about strategy, the CEO is not always worried about strategy. If strategy happens to be the most important issue at that point, the CEO is worried about strategy. If an operational problem impacts the company this year, the CEO may be worried about operations. If it’s a finance policy issue, the CEO may be worried about finances.
The CEO and the person referring you need to trust you
Let’s assume you are right, it is a strategy problem. Strategy is more than mere analytics. It’s a function of trust and reputation. The CEO needs to trust you, to give you the consulting work, and the person referring you needs to trust you.
So if you go and speak to the Chief Financial Officer, and you know her well and you want her to introduce you to the CEO, don’t just have some fancy enterprise value analysis. Gain her trust. And over time, when the CEO sees the consulting work you’ve done for the Chief Marketing Officer or Chief Financial Officer then you can work your way up to the introduction to the CEO. That is, if you are unable to immediately build relationships with the CEO, that’s one way to do it.
Doing most pressing consulting work
But all other things being equal, if your relationship lies with the Chief Operating Officer, ultimately, you are likely only going to end up doing consulting work in operations, even if operations may not be the most pressing problem facing the company. And, as a trusted advisor, you have to do the most pressing consulting work impacting a company, not just the most pressing work impacting the person with whom you have a relationship. If you do that, you will also leave an opening for a rival firm.
What about the Chairman of the Board?
And that is why we put an enormous emphasis on building relationships with the Chief Executive Officer and with the Chairman of the Board. Because the Chairman of the Board in many companies has purview over strategy, and the CEO needs to work with the Chairman. Often the Chairman will need to approve M&A discussions. In very rare situations, the Chairman and the CEO are the same person. In some countries, legislation requires these roles to be separated.
The role of a CEO allows for a relationship that can cover any domain in a company
So, coming back to the role of the CEO and why you need to work with the CEO, the reason you work with the CEO is that you have a relationship that can cover any domain in a company.
Relationship with the CEO offer higher return on the relationship
While relationships between a management consultant as a trusted advisor and a CEO or any other executive are always beyond transactional, when you have a relationship with the CEO, you’re getting a higher return on the relationship.
So that’s the reason that we as management consultants want to build relationships with CEOs. If you, as a consultant, don’t have that relationship, it’s not a big deal, you can work with other executives. And, over time, build credibility and work your way up.
Danger of providing consulting services for other executives
But credibility is not just about doing great operations consulting work. So let’s assume you are working with the Chief Marketing Officer and you’re doing a marketing segmentation study. Now, if the Chief Marketing Officer sees you as a marketing specialist and your firm as a marketing specialist, they may not want to introduce you to the CEO, or any other executive. So while you start building the relationship with one part of the organization, it is important that you, as a consulting firm providing the consulting services, have the ability, and the wherewithal to tackle any issue that may arise.
In this particular episode, which is a part of a step by step study, we explain exactly what is the role of the CEO and why consultants should target CEOs.
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