Who, in their right mind, would want to be the CEO of a communications service provider these days? Of course, many people crave the position which they see as one of power and high remuneration, but closer inspection reveals that the person on top is the prime target for blame, whatever he or she does. We talk about the telecoms industry grappling with two-sided business models but for the CEO sitting in a multi-sided ‘shooting gallery’ life at the top is tenable, highly stressful and often quite short.
I have developed a fascination for telco industry headlines, particularly those in the financial pages, and am seeing a disturbing pattern emerging. The CEO inadvertently features in these, not because he is the person responsible for the news (quite often journalists do not understand who is) but because he has the profile and title. We are part of a blame society where someone personally has to take the blame for bad news. Good news is most often attributed to the company or the management team, not the CEO alone. This is a strange anomaly that you will see over and over again.
People now live in a communications age where the supplier of links to voice telephony, internet and social networking have become the most valued service provider. The customer has become ultra-dependent on the links our industry provides and any failure or disruption is immediately pounced on by the press, sometimes with devastating circumstances. It has been researched that people trust their CSP more than their bank so they are extremely sensitive to any failings, a point the press finds very tantalizing. When it does go wrong you can bet the CEO will be targeted, almost as if to personalize the issue.
The customer is a big portion but far from the only part of the CEO’s responsibility load. He also has his shareholders and the financial markets to appease. Continuous improvements in financial results are not just expected, they are demanded. Share prices are affected by some perverse psychology that sees them dropping when announcements of investments in the future of the company are made, and skyrocketing when mass lay-offs are executed. How perverse is that?
That introduces the third area of responsibility for the CEO – his workforce. The continuous pressure to lower costs, through improvements in IT and automation and the subsequent lowering of staff numbers can become a heavy burden for many CEOs. If the calculation of productivity gains with less people are wrong the results can be very serious. Potential strikes, internal fraud and even sabotage can all become issues. In extreme cases, suicide amongst workers unable to cope with the stress of increased workload or loss of work become major issues. He may even be called on to justify his own compensation that some feel could be put to better use to pay the salaries of hundreds of dispossessed workers.
Last, but not least is the continuous pressure from each business unit keen to secure budget for its own activities, and the board, that can override any decision the CEO arrives at after careful consideration of all the points listed previously. Not only does he have to be the main congruence point and be able to justify each and every decision to everyone above, he also has to be a prophet and see into the future because many if his decisions will impact the business for the next five or even ten years. It takes a lot of gumption to push for multi-million dollar investments in new, and often unproven technology, to keep ahead of the competition.
Most important of all, today’s CEO has to be a ‘jack of all trades,’ in other words, he has to have a good understanding of every component in his business or have deputies that he can totally rely on to manage and advise on them.
Who, indeed, would want to be a CEO?