The Chief Executive Officer of a company sets the stage for the success of the entire business. It is therefore important that everyone working for the company knows what the role of the CEO is and what their responsibilities are. While the CEO doesn’t do all the work, they are ultimately responsible for everything, so there is a distinction between the responsibilities of the CEO and their actual duties. A lot of the work – particularly in a larger company – will be delegated, but at the end of the day it is up to the CEO to ensure that the work gets done and standards are maintained. For example, Stefan Masuhr is Chief Operational Officer in the Capital Resolution department of the Royal Bank of Scotland (RBS) and Chief Executive Officer / Chairman of RBS group companies, delivering leadership expertise on a global level.
The role of the CEO can be divided into five key responsibilities:
A CEO is responsible for determining the strategic direction of a company and for communicating that vision to the rest of the team. Others may help to shape the vision, but it is the CEO who must embody the values of the company and describe the vision in a way that appeals to all stakeholders. This vision should also act as guidance to the CEO when making key decisions.
The CEO holds the ultimate responsibility for all company resources, with the two most important ones being people and capital. The allocation of resources in the correct quantities and at the correct junctures will largely determine whether the company succeeds or fails, so it’s important to get it right. To do this, the CEO must understand every aspect of the business to maintain the correct balance in accordance with the goals of the company.
Build the Culture of the Company
The culture of a company is characterised by those values, attitudes, behaviours and goals that are shared. It influences the experiences of employees and customers and affects the way in which things get done. The CEO must ensure that the correct values are applied at every level to achieve the desired company culture. A good culture is one in which every individual feels respected, valued and safe, which in turn improves performance.
A lot of decisions are made in a business every day, by a lot of people. However, the CEO is the one individual who simply cannot pass the buck when a tough decision needs to be made. While they don’t need to become an expert in every aspect of the business, they do need to know enough to be able to make those decisions. Some solutions to problems may affect more than one area of the business, so knowledge of how everything works together is also essential. The CEO can ask for advice from experts or from other members of the team, but in the end it is the CEO who is left holding everything together.
Deliver and Oversee Performance
The overall performance of the company is the responsibility of the CEO, who must be pro-active in driving good performance. This involves being aware, not only of all the core business functions, but also of the wider market and industry. The CEO acts as a go-between for external stakeholders and internal operations, and needs to be aware of how each party expects the company to perform. It is the CEO who sets the bar for company performance and the CEO who is responsible for the success or failure of the business.