The Chief Executive Officer
For hundreds of years, there have been CEO’s at the helm of companies driving their value and leading the team that surrounded them. To this day, they have been come to be known as the “boss” or “the individual with all of the power.” While almost anyone you encounter on the street is going to know who the CEO is and attempt to depict him as an old man in a 3 piece suit, most people probably do not fully understand the CEO role.
I was admittedly one of those people until a few years ago when I began to perform intensive research into the CEO role and what they are responsible for. At the time, I was preparing to step into the CEO role with Portlight and I was determined to live up to the expectations that were put upon me.
The Chief Executive Officer Role
Before diving into the roles and responsibilities of the CEO role, I would like to share that the specific day to day responsibilities of the CEO will drastically vary dependent upon the size and mission of the company that they are running. The appearance of the CEO at these different levels will also greatly vary – some in the stereotypical boardroom attire while others lounge around in jeans and a t-shirt.
Today, being the CEO of a company comes down to your knowledge, strategic approach, and execution rather than the clothes on your back. As I was eluding to, CEO’s of small businesses and startups where the head count is less than 25 will have a drastically different role than the CEO of a public company with over 2,000 employees operating across borders. However, at the core of their role, they tend to stick to 8 major areas within the company.
Set the Strategy and Vision for the Company
A company without a well thought out and tested vision and strategy will not run as efficiently as it should and employees will lack direction. The CEO is the captain steering the ship and he must decide where the ship is going and how it is going to get there while dodging obstacles at every turn.
The CEO is responsible for taking the time to frequently reassess the vision and strategy that the company originally created to ensure that it is still flawless in its execution. As we will see with all of the CEO responsibilities, having a sound vision and strategy is critical.
As the CEO of Portlight, I made time to regularly review the vision that I had created for the company to ensure that what we were doing today matched up with where we were trying to go in the future. I spent a lot of my time focused on developing a 1 year strategy that I then broke down into quarters and months respective to each team and individual within the company. Once confident in my plan, I would meet with my executive team for feedback, make adjustments, and then set up meetings with the team.
On every Friday, I organized strategy meetings where we discussed our direction for the next year, our purpose in the current quarter, and areas of immediate improvement.
At the beginning of each quarter, I organized a strategy meeting where we came together to evaluate the past quarter’s performance to plan and set new strategic goals for the next quarter.
Finally, at the beginning of each year, I organized a company retreat outside of our offices to share the vision for the upcoming year and highlight our main focus as a team.
Build the Culture of the Organization
Depending upon the size and stage of the company, the CEO will have a different impact on cultivating a culture. Regardless, the CEO is responsible for creating the standard for how the company behaves, what it believes in, and the traditions that it is defined by.
Building a culture is an intricate process of thought provoking activities that eventually result in the company’s mission, vision, values, behavior, and rules. For most organizations, the CEO has the greatest ability to influence the culture and is looked at as the embodied version of the culture.
I’ve written about the CEO role and its influence on company culture in greater depth delving into examples from leading tech entrepreneurs today. Read The Importance of the CEO on Company Culture to learn more.
The CEO is responsible for deciding how the team dresses, how the team interacts, how the team hires and fires, how raises and promotions are rewarded, how time is valued, how open the executive team is, how long the team works each day, how problems are resolved, how the company is communicated to outsiders, and how vacation time is determined. The list is quite endless. Every decision that the CEO makes has an influence on the perception of the company culture.
As I first stepped into the CEO role at Portlight, one of the aspects that I was most excited about influencing was the culture of the company. It is a topic that I had researched in college and I always had a vision of creating one where people were within roles they were passionate about, had a vision to relate to, and had the freedom to creatively impact the growth of the company.
I had read numerous sources about building a culture based off of values so I set off in that direction. I took the time to deeply reflect upon where we started, what we had already built, and the shared values that our founding team shared. I considered how I could explain them in terms of who it would ultimately attract.
I finally landed on 3 core values that I felt best described our culture: teamwork, innovation, and perfection.
I also defined each to give greater context and understanding for our team and new recruits.
Teamwork defines the way that we interact as a team. We are collaborative on all projects. We argue constructively until we find the best solution. We treat each other with respect and we ignore vertical hierarchies. We work for each other and the betterment of the company’s future.
Innovation defines the way that we think, create, and act. We never settle for something just works. We always ask the question “why?” We understand how others have done it and we create a new, better way. We encourage new ideas and we are quick to test them. Failure is welcome.
Perfection defines the manner in which we carry ourselves. We seek individuals who are relentless in their pursuit. We are resilient – getting back up each time we are knocked down. We never settle for the status quo…we always push forward. We don’t believe in absolute perfection but we are always striving towards the closest thing possible.
Over my time as CEO, our values have changed slightly as we have built our team and matured. As the CEO, I reminded myself of our values each morning as I woke up in an effort to fully embody them. My consistency created the culture that permeated our entire company. It is one of the greatest secrets to building a great culture. Become what you communicate.
Recruit and Develop the Team
Recruit, recruit, recruit.
As the CEO, you are ultimately responsible for each person that is hired and welcomed into your organization. You may not be involved in every single interview process once you have more than 100 employees, but your hiring mindset should always permeate the hiring decisions being made.
Hiring right the first time is critical to the growth of the company as it adds new talents to your team that can have an immediate impact. The CEO is responsible for creating the recruitment process, the interview process, the desired criteria, and, ultimately, being the final say on all hires.
Just as important, the CEO is responsible for providing opportunities where employees can grow, both personally and professionally. A CEO’s inability to hire, fire, and develop the team correctly will lead to inefficiency, slowed growth, and decreased trust from the team.
Even before assuming the CEO role at Portlight, I was involved in the company’s recruitment, interview, and hiring strategy. In the beginning of 2015 as we approached over 50 team members, I continued to stay involved in the recruitment and interview process because of the importance of adding new team members that not only met the skills requirements but also were a fit in our unique culture.
On a daily basis, I seeked out individuals on LinkedIn, got coffee with potential hires, conducted final round interviews, and managed our team of recruiters.
When it came time to make a decision, I would gather with my executive team, recruitment team, and the team where the individual would be joining to hear all opinions on their skills, attitude, and cultural fit.
Finally, our decision would be run by our CFO to ensure that the hire was financially viable. With experience hiring more than 100 individuals throughout my longevity with the company, I have seen first-hand how different of an impact a good hire vs a bad hire can make in the short and long term.
Businesses fail when their CEO does not correctly allocate capital to the best areas of the company at the right time.
We have all heard of companies that raise millions of dollars only to be shut down 2 years later because they ran out of cash.
In the CEO role, you are responsible for understanding the financial health of the company, accurately forecasting revenue and expenses with your CFO, managing headcount expenses, and making sound financial decisions that contribute to the growth of your revenue or the lowering of your expenses.
The CEO is responsible for ensuring that profit margins and revenue are steadily growing at a rate greater than expenses. In unison with the CFO, the CEO is responsible for recording daily financial figures, creating budgets for each team, and adjusting spending when performance does not meet projections.
As the CEO of Portlight, I built a master spreadsheet that I utilize to record daily financials, create short and long term projections based off of various forecasting models, manage head count, and set financial benchmarks for the company.
Along with my CFO and COO, I held finance meetings once per week to assess our performance to projections, discuss hiring needs, and allocate capital to projects within our teams.
Looking back, I have learned a tremendous amount about growing at the right pace, proving a new run rate before adding additional expenses, and creating a reserve for downfalls in the life cycle of the business.
For more in depth advice on managing your finances, both personally and as an entrepreneur, sign up to the blog’s email list.
Raise Funding and Investments
Dependent upon the financing strategy, the CEO role may be responsible for raising funding for the company.
For businesses that are bootstrapped, i.e. they are funded by an initial investment – usually from the founders – then by the revenue that the company creates, fundraising is less of a factor for the CEO.
However, for companies that require large sums of investment to start or that decide they want to grow faster because of an opportunity in the market, the CEO becomes the most important individual to make that happen.
In these situations, the CEO is responsible for studying fundraising, creating pitch decks and business plans, making key contacts with angel investors or venture capitalists, securing meetings to pitch the investment, and then finally reaching a deal with the investor.
When CEO’s commit to raising funding for their company, it tends to pull them away from all of their other responsibilities for at least 6 months while they are on the road entertaining meetings and negotiations. Raising funding requires a great deal of preparation, sound communication skills, and a foolproof business plan that will present investors with an opportunity to make 10x their initial investment.
To date, I have not had the opportunity to experience fundraising in the CEO role. However, I have conducted months of research into the topic to better understand the ins and outs of the process. I have spoken with tens of investors, entrepreneurs, and business individuals to gain their insights.
The outcome is all across the spectrum when asking the question, “should a business raise funding?” Some believe that it is the best move while others encourage you to bootstrap as long as possible in an effort to preserve your equity in the company.
Spokesperson between the Board of Directors and Executive Team
Dependent upon the size and financing strategy of the company, the CEO role may be responsible for being the main communicator between the board of directors and the company’s executive team. The board of directors is usually comprised of investors, advisors, and founders. The executive team is the C-suite level individuals, i.e. CEO, COO, CFO, CMO, VP of Sales, etc.
In a company where fundraising has taken place, a Board of Directors is formed to oversee the decisions made by the executive team. Since they have invested their hard earned money, they also get a say in the company’s future.
The CEO is responsible for regularly updating the board on performance of the company, explaining decisions, and identifying areas of potential threat.
The CEO is also responsible for communicating direction given from the board to the executive team to ensure both parties are on the same page.
Finally, when there are disputes, it is the CEO’s responsibility to reach a solution with the board. In this role, the CEO acts as an ultimate communicator.
My extent of experiencing this aspect of the CEO role stems from my involvement in creating a formal advisory board for Portlight.
Interested in forming a group of entrepreneurs, business individuals, and investors with a variety of complementary skills, I set out over a 1 year period to network with some of the brightest minds in Orlando.
After almost 6 months of suiting, I became responsible for providing regular updates on the progress of the company to a select group of individuals interested in Portlight. After meeting with each advisor, I was responsible for debriefing the executive team and providing action steps for the future.
While the advisors we were working with did not have any official say in the decisions of the company, the basic role of the communicator held true.
Thinking about starting your own advisory board or interested in learning more about their purpose, read 8 Reasons Why You Should Build an Advisory Board.
Sales, Marketing, and External Public Relations
In the CEO role, you are the face of the company to your team, to your customers, and to the public.
You are responsible for creating a strategic direction for your sales team, speaking with potential and existing customers about the product or service you are offering, and tracking success of the sales team.
In marketing the company, the CEO is responsible for aligning the brand identity of the company with its core values and mission. And to the public, the CEO is responsible for conducting interviews, networking, attending conferences, and updating the world on the company’s progress.
With the regularity of news updates in today’s world, the CEO serves as the public’s understanding of who the company is on the inside. In this sense, the CEO is responsible for creating their own personal brand so that they can make as significant of an impact on the public as possible.
As the CEO of Portlight, my role as a personal brand slowly evolved placing me in a position where I was regularly interacting with others on social media, attending events to network, and speaking at local events to spread the Portlight name.
As our marketing efforts increased on Youtube and through email marketing, I took lead of the team to set strategy, create new ideas, and compare performance to goals set. Within our sales pipeline, I assumed responsibility for researching and identifying potential leads for our VP of Sales and COO. My knowledge of the industry placed me in an advantageous position to set up strong partnerships.
Regardless of the extent to which the CEO is involved, it is critical that their presence be felt by the team, customers, and public.
Leading the Executive Team and Company
The eighth and most overarching responsibility of the CEO role is leading the company to achieve its strategic plan of action.
In this role, the CEO is responsible for organizing the agenda for meetings, facilitating positive and healthy debates, holding personal reviews with employees, motivating the team on a daily basis, turning conflict into change, handling complaints, and understanding every aspect of the company.
Being a figure that the team looks up to and is inspired by is a key to fully embodying the CEO role. The CEO is responsible for reacting to the highs and lows of the business and assuring the team that all is well at all times. The composure of the CEO greatly impacts their ability to effectively lead their team to success.
Share Your Story in the CEO Role
If you are currently in the CEO role, share how these eight aspects impact your work on a daily basis and how you balance them to drive growth for your company.
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