Free Micro-eMBA Module #3: Role of Chief Executive Officer
© Copyright Carter McNamara, MBA, PhD, Authenticity Consulting,
LLC. Adapted from the Field Guide to Leadership and Supervision in Business
and Field Guide to Leadership and Supervision for Nonprofit Staff.
This learning module is in the organization development program. However,
this module can also be used by anyone as a self-study exercise
to learn more about the role of the chief executive officer.
Sections of This Module Include the Following
Introduction
Outcomes
Materials for Review
Suggested Topics for Reflection and Discussion
Activities to Build Systems and Practices
Assessments
Tracking Open Action Items
INTRODUCTION
In an incorporated organization (including in a nonprofit),
the chief executive officer (CEO) is the singular organizational
position that is primarily responsible to carry out the strategic
plans and policies as established by the board of directors. The
chief executive officer reports to the board of directors. In
other types of organizations (other than corporations, eg, sole
proprietorships), the top-level officer is often called the chief
executive officer, as well.
The goal of this module is to provide sufficient overview to
gain strong, initial perspective on the role of chief executive
officer, particularly when helping to establish the board of directors.
The chief executive officer should have at least basic understanding
of all of the systems and practices conveyed across the various
learning modules in this program. Therefore, this learning
module does not go into great depth about each of the particular
systems and practices managed by the chief executive officer —
rather, this module relies on the rest of this program to provide
that depth of information.
NOTE ABOUT THE ORDER OF MODULES (AND SOME DUPLICATION WITH
UPCOMING MODULE ON BUILDING BOARDS): The board of directors in
a corporation is legally charged to govern a corporation. Therefore,
it is often common to start training programs with an overview
of the board of directors. However, in this program, this learning
module about the role of the chief executive is presented before
the learning module about boards of directors. The reason for
this order of modules is as follows. Frequently corporations are
started by someone with a strong vision for a new product. That
person often goes on to become the first chief executive officer
of the new organization. Typically, that person also takes a very
strong role (often the leading role) in the initial organization
and development of the board of directors. Therefore, modules
in this program are organized to help the founder (and often the
first chief executive officer) maintain clear perspective about
the roles of chief executive officer and board of directors before
going on to focus attention on building the board of directors.
NOTE ABOUT BOARD COMMITTEES: If you are starting a corporation
and using this program to do so, then you will soon be building
your board. When you do, consider establishing a Board Personnel
Committee to review and help guide implementation of the information
in this learning module — that Committee could be very useful
to help develop and support the CEO. Major activities and goals
from this learning module could be incorporated in that Committee’s
Committee
Work Plan.
Also consider
Related Library Topics
OUTCOMES
Learners who complete this module will achieve the following
outcomes:
- Learn What a Chief Executive Officer Is
- Understand Major Functions of CEO
- Understand Core Knowledge and Skills for CEO Role
- Be Prepared for Building Your Board
- Set Basis for Strong Board-Staff Relationships
- Avoid “Founder’s Syndrome”
MATERIALS FOR REVIEW
- The following materials will help you address each of
the topics and learning activities in this module.
Orientation to Chief Executive Role
Chief
Executive Role — particularly the sections:
– – – What
is the “Chief Executive Officer”? (review all)
– – – What
Do Chief Executive Officers Do? (review all)
– – – – – – General
Responsibilities (review all)
– – – – – – Typical
Functions/Responsibilities (review all)
– – – – – – Sample
Job Description (study)
– – – Core
Areas of Knowledge and Skills (click on each area and scan contents)
Basic Preparation for Building a Board
Overview
of Board Roles and Responsibilities — particularly the sections:
– – – Board
Roles and Responsibilities
– – – Sample
Job Descriptions
– – – Guidelines
for Recruiting New Board Members
– – – Sample
Board Application Form
– – – Ideas
to Generate Participation of Board Members
Basic Preparation for Working With Board
Board
and Staff Responsibilities
Sustaining
High-Quality Relationship Between Board Chair and Chief Executive
Should CEO Be On the Board? (scroll down, read
several articles)
Guidelines
for Evaluating the Chief Executive
Sample
Form for Board’s Evaluation of Chief Executive
Optional: “Founder’s Syndrome”
This is a fairly long document. Still, it’s worth a careful
read because it fully describes this syndrome which occurs so
often when starting an organization.
Founder’s
Syndrome — How Organizations Suffer — and Can Recover
SUGGESTED TOPICS FOR REFLECTION AND DISCUSSION
- Learners are strongly encouraged to discuss the following
questions with peers, board members, management and executives,
as appropriate.
Orientation to Chief Executive Role
1. What is the “definition” of a chief executive
officer? See What is the “Chief Executive Officer”?
2. In a corporation, to whom does the chief executive report?
See What is the “Chief Executive Officer”?
3. What are the five major roles of a chief executive officer?
See Major Roles of the Chief Executive.
4. What are the six major functions/responsibilities of a chief
executive officer? See Major Functions/Responsibilities of Corporate
Chief Executive Officer.
Basic Preparation for Building a Board
- Note that the founder of a corporation often recruits
the first board members, and supports members to grow into their
roles as board members, as well. Therefore, the founder should
initially have some very basic understanding of the roles of
a board. This understanding will soon be enhanced later on during
further development of the board and organization.
1. Name the five duties and ten responsibilities of boards
(as listed on the materials included in your materials for review)?
(Note that various experts might offer a different mix of duties
and responsibilities. The important point here is to get a basic
sense of the overall responsibilities of a board.) See Board Roles and Responsibilities.
2. To whom is the board of directors responsible? See Board
Roles and Responsibilities.
3. What are the responsibilities of the board chair? Vice chair?
Secretary? Treasurer? Board member? Be sure you understand the
role of the board chair. The chief executive officer and the board
chair work closely together to coordinate and support board activities.
See Sample Job Descriptions.
4. Of the 10 guidelines for recruiting board members, how many
can you remember? The chief executive officer often plays a key
role in recruiting the first members of the board of a new organization.
See Guidelines for Recruiting New Board Members.
5. What information is requested by the board application (as
listed in your materials for review)? (You might customize your
own application form, of course.) See Sample Board Application Form.
Basic Preparation for Working With Board
1. Test your initial knowledge of the roles of board and staff
by completing the table at Board Roles and Responsibilities — Test Your
Knowledge. Next, compare your answers to the answers depicted
in the table Board and Staff Roles.
2. Name at least five actions that chief executives and board
chair can take to ensure an ongoing, strong working relationship.
See Board and Staff Responsibilities and Sustaining High-Quality Relationship Between
Board Chair and Chief Executive.
3. Name at least five actions the chief executive and board
members can take to ensure ongoing, strong participation of board
members. See Ideas to Generate Participation of Board Members.
4. Describe the general procedure for evaluating the chief
executive. See Guidelines for Evaluating the Chief Executive
and Sample Form to Use During Evaluation of Chief
Executive.
Optional: “Founder’s Syndrome”
- “Founder’s Syndrome” can easily occur, primarily
in new organizations. Organizational leaders can avoid a great
deal of pain and hardship by understanding the basics of this
syndrome and how to avoid it. When addressing the following questions,
refer to the document Founder’s Syndrome.
1. What is “Founder’s Syndrome”?
2. What causes it?
3. How can you recognize it?
4. Name at least three actions that boards can take to address
it.
5. Name at least three actions that chief executives can take
to address it.
ACTIVITIES TO BUILD SYSTEMS AND PRACTICES
- Learners are strongly encouraged to complete the following
activities, and share and discuss results with peers, board members,
management and employees, as appropriate. - As you proceed through the following activities, be sure
to note any incomplete actions in the Action Item Planning List.
Writing a CEO Job Description
1. Draft a job description for the position of chief executive
officer of your organization. If applicable, present the draft
to your board for review and authorization. See Sample Job Description. Note that this job
description should not merely be adopted as is, rather it should
be modified according to the nature of and needs of your organization.
)
Getting Ready to Recruit Your First Board Members
Basic Materials to Prepare
1. Draft a list of guidelines you can follow to being recruiting
members for your board. See Guidelines for Recruiting New Board Members.
2. Draft a board application form that you can use to begin
recruiting members for your board. See Sample Board Application Form.
3. One of the biggest turn-offs to potential board members
is the appearance of an organization that’s out of control, or
that’s in crises. The planning and systems you’ll glean from this
online program will help your organization to be attractive to
potential board members. For now, gather materials that will help
potential board members understand your organization, for example,
marketing brochures, your mission statement, etc. Give them job
descriptions of board members. (You’ll soon develop more useful
board materials in an upcoming module in this program.) See Sample
Contents of Board Member’s Manual.
Identify Potential Board Members — Focus on Skills Needed
by the Board (Eg, finance, marketing, personnel, etc.)
4. Make a list of what skills are needed by your organization.
Think about what skills — not just what people — are needed
on your board. If you’re just getting started with your new organization,
then you can use almost any help you can get — but there are
certain skills that are usually very useful early on, for example,
financial help, help designing organizational structures, etc.
Your needs will become more clear to you when you start and finish
strategic planning in an upcoming module in this program. (Reference
the Sample Board Recruitment Grid.)
5. Write a list of at least five people whom you will approach
to join your board. See Sample Job Descriptions and Sample Board Application Form.
Managing Your Board and Employee Relations
1. What problems might you foresee in working with a board?
It can be a major challenge for strong, visionary founders to
help organize and develop a group of people to whom he or she
reports. Write a list of the advantages and disadvantages to you.
How can you overcome the problems that you might foresee? Present
your concerns in an upcoming board meetings and ask for open discussion
around your concerns. Or, approach another appropriate source
of help — but do address your concerns. They’re likely to only
get worse if left unaddressed. See Board and Staff Responsibilities and Sustaining
High-Quality Relationship Between Board Chair and Chief Executive.
Building the Foundation for Board Evaluation of Chief Executive
1. Draft a set of preliminary performance goals for the role
of chief executive officer for your organization (this list of
goals will be refined in a later module about strategic planning).
The board of directors should evaluate the performance of the
chief executive officer on a regular basis. This evaluation should
be done on a regular basis and should include reference to the
responsibilities listed in the job description and performance
goals for the year. The performance goals should be closely aligned
with goals established during strategic planning. Performance
goals defined during this module should be updated as a result
of the strategic planning conducted in the upcoming learning module
about strategic planning. See Guidelines for Evaluating the Chief Executive,
Sample
Form to Use During Evaluation of Chief Executive and Performance Management (basics concepts).
2. Write a set of guidelines that will be followed by your
organization to evaluate the chief executive officer. Have the
board members review the guidelines. (Later on in the learning
module about boards, we will formally adopt a set of guidelines
for evaluating the chief executive officer.) See Guidelines for Evaluating the Chief Executive
and Sample Form to Use During Evaluation of Chief
Executive.
Optional: Does Your Organization Have “Founder’s Syndrome”?
1. Share copies of the Founder’s Syndrome document with board members,
if you already have them. Set aside 15 minutes in an upcoming
board or staff meeting to share reactions and ideas about what
you might do in the coming months in order to avoid the syndrome.
Write down an action plan of what you will do, who will do it
and by when. In the action plan, include actions the chief executive
officer and the board can take.
ASSESSMENTS
The next learning module will provide an overview of basic
management and leadership skills needed to start and manage an
organization. However, you might find it useful to begin thinking
about your own skills at this time. If so, consider the following
assessment.
1. Needs Assessments for Management Training and
Development
TRACKING OPEN ACTION ITEMS
1. One of the first indicators that an organization or a person
is struggling is that open action items are not tracked and reviewed.
(Open action items are required actions that have not yet been
completed.) Instead, people only see and react to the latest “fires”
in their workplaces or their lives. Whether open action items
are critical to address now or not, they should not entirely be
forgotten. Therefore, update and regularly review a list of open
action items (identified while proceeding through this program)
that includes listing each open action item, who is responsible
to complete it, when it should be completed and any associated
comments. When updating the list, consider action items as identified
during discussions, learning activities and assessments in this
module. Share and regularly review this action item list with
the appropriate peers, board, management and employees in your
organization. You can use the following Action Item Planning List. (At that Web address,
a box might open, asking you which software application to open
the document.)
2. If you have questions, consider posing them in the national,
free, online discussion group hr.com, which is attended
by many human resource and organization development experts.
(Learners in the organization development program can return
to the home page of the organization development program.)
For the Category of Leadership:
To round out your knowledge of this Library topic, you may
want to review some related topics, available from the link below.
Each of the related topics includes free, online resources.
Also, scan the Recommended Books listed below. They have been
selected for their relevance and highly practical nature.