A.G. Lafley, Procter & Gamble’s CEO (and now Chairman), penned an HBR article in May that I think best summarizes the job of the CEO. Get your assistant to buy it — and you should read it — very good stuff.
To give a taste, here’s my summary, plus a few of my favorite quotes.
Lafley argues that because the CEO doesn’t report to anyone within the enterprise, only he can truly advocate for customers and shareholders. As Peter Drucker, Lafley’s guru, stated: “The CEO is the link between the Inside that is ‘the organization’ and the Outside of society, economy, technology, markets, and customers. Inside there are only costs. Results are only on the outside.”
Lafley states it well: “The CEO can see opportunities that others don’t see and, as the one person whose boss isn’t another company employee, make the judgments and the tough calls others are unable to make.”
The job of connecting the inside to the outside entails four activities:
1) Defining in clear terms the nature of the outside — identifying the target customers.
2) Setting strategy. This means deciding what the company will do, and will not do.
3) Balancing short term expenditures with long-term goals. Ensuring the right trade-off.
4) Setting and reinforcing company values.
Lafley’s concepts are highly germaine — especially given the aftermath of the Gateway Recession, when fundamental changes will be forthcoming in customers, market structures, elites, media, and marketing. This will not be a time for CEOs to hunker down and stay internally focused. Lafley’s is a clarion call for the ultimate leader to get out of the office, shed old thinking, open themselves to the impending societal revolution,and advocate for new ways of operating. As Drucker states: “One cannot manage change. One can only be ahead of it. In a period of upheavals, such as the one we are living in, change is the norm.”