A chief executive officers (CEOs) is the highest-ranking person in any organization. The CEO roles and responsibilities are many and equally challenging and varying from leading employees, navigating social and economic challenges, to driving the enterprise to grow and profit. If you think about a CEO’s job description, he is the one making all the important decisions to run a company including day-to-day operations.
Chief Executive Officers are also involved in strategic decision-making that promotes the company’s growth. A CEO often reports to a board of directors who collectively make sure that the company is functioning well.
What is a chief executive officer?
A chief executive officer (CEO) is the highest-ranking executive in a company. The chief executive officer serves as the public face of the company in many cases.
According to the US Bureau and labours Statistics, the role of the chief executive officer is to plan strategies and policies to ensure that the goals of the organization are met. They carry out policies, goals, and procedures. The chief executive officer also manages general activities. They always consult with other executives, board members, and staff about the general operations. CEO’s responsibility also includes appointing department heads and managers, analyse financial statements, sales reports, and other performance indicators.
How are CEO’s elected?
CEO’s are usually elected by the board of directors and stakeholders. They report to the chair and the board who are appointed by shareholders.
What does a CEO do?
A CEO’s role and responsibility varies depending on the organization’s size, culture, and corporate structure. CEOs in large corporations mostly deal with very high-level strategic decisions and those that direct the company’s overall growth.
CEOs may work on strategy, organization, and culture. They may look at how capital is allocated across the firm or how to build teams to succeed. They can also set the tone, vision, and sometimes the culture of their organizations. CEOs in smaller companies often are more hands-on and involved with day-to-day functions.
As per a study from Harvard Business Review on how CEOs spend their time. They found that 72% of CEOs’ working time was spent in meetings. Of the remaining working time, 25% was spent on relationships, 25% on business unit and functional reviews, 21% on strategy, and 16% on culture and organization. As per the study just 1% of CEO’s working time was spent on crisis management, and 3% was allocated to customer relations.
CEO roles and responsibilities explained
A chief executive officer’s roles and responsibilities also vary greatly between industries and organization sizes. A CEO may generally be expected to take on some or all of these tasks:
Guiding organization in strategic direction
CEO’s main task is taking the company in the right direction by deciding on the long-term plan. As a CEO understanding mission, vision, and values of the organization is important.
Implementing changes
A CEO works in tandem with their team to implement changes that can help achieve the long-term vision. These changes are usually worked on by the managers but ultimately it’s up to the CEO to ensure that the long-term plans are being followed through.
Public relations
A CEO is often the face of the company and may have to speak at all the required public forum, be it conferences or community events.
Tracking organization’s performance
One of the main responsible of a CEO is tracking organizations financial performance. CEO’s rely on metrics to track how things are going. Usually the reporting is provided by the managers reporting directly to the CEO.
Creating right working culture
To achieve success, a CEO’s role is also responsible for setting the tone and creating the work culture and environment necessary to derive it. CEO are often the role model for executive to develop and maintain the organization’s culture.
Allocating resources
As CEO, you’ll decide how to invest a company’s resources (capital, personnel, and time) to achieve business objectives.
Building right executive team
As CEO one is responsible for selecting the top leader and also how to manage and ensure they work well together.
Communicating with stakeholders
Communicating with the Board of Directors is important as CEO is the face of the company, and involves keeping internal and external stakeholders informed.
CEO remuneration
The Chief Executive Officer compensation usually include salary, stock options, bonuses, and other perks. They may also receive tax holidays, financial counselling, and security details. Their travel allowance includes ground transportation and private jets.
The chief executive officers of large corporations often achieve fame or infamy because of their frequent dealings with the public.
CEO salaries make the news when they are astronomical. Like Elon Musk’s salary in the billions of dollars per year, or Tim Cook’s nearly billion-dollar salary as the head of Apple, Inc. Though these salaries are not what represents most CEOs. According to Lightcast™, the average annual earnings for chief executives comes to $182,141.25 for those with a bachelor’s degree and at least five years of experience.
CEO vs other executives
The top boss are called using various titles that begins “chief.” This group of top senior executives have come to be called C-suite or C-level in the corporate world.
The CEO may also be serving as the chief financial officer (CFO) or the chief operating officer (COO) for small organizations or those that are still in the startup or growth phases. This can lead to a lack of clarity and can overwork an executive. Assigning multiple titles to a single executive-level individual can wreak havoc on a business’s continuity and ultimately affect its long-term profitability.
Difference between CEO and COB
The responsibilities for the role of a CEO is to direct the operational aspects of a company. The board of directors oversees the company as a whole. This is led by the chair of the board (COB). The chair of the board does not have the power to overrule the board but the board has the power to overrule the CEO’s decisions.
Difference between CEO and CFO
The CFO is the chief financial officer of a company. CEOs manage general operations. CFOs focus specifically on financial matters.
A CFO looks into the organizations financial strengths and makes recommendations to improve any weaknesses.
Difference between CEO and COO
The chief operating officer (COO) is often ranked below the CEO. Their responsibilities are recruitment, legal, payroll, and training, along with administrative duties as the head of HR (human resources).
The CEO is responsible for making major corporate decisions, driving the direction of the company, supervising other executives, and overseeing growth plans. CEO’s are accountable to stakeholders and are often the public face of the organization. CEOs typically have extensive experience in their industry and are tasked with guiding their company toward success and profitability.
