Page last updated at 03:25 Asia/Manila, Tuesday, 21 January 2014 PH
There is such a dearth of qualified CEOs in the Philippine business environment that very many of the leading conglomerates keep on recycling CEOs from one subsidiary to another all the way to ages beyond 70. This is one reason why the University of Asia and the Pacific decided to ask the help of one of the leading business schools in the world, the IESE Business School in Barcelona, Spain to mount an Advanced Management Program oriented towards developing future CEOs among executives in their forties or fifties (or even younger if they happen to be the children of the owners and are destined to be CEOs of family corporations). In a recent trip to Barcelona to accompany some Southeast Asian executives for their last one-week module held at the IESE Business School, I had the fortune of interviewing the Dean of IESE himself, Dr. Jordi Canals, who has written a good number of best sellers on top management or executive education. I was doubly lucky because he gave me an autographed copy of his book entitled Building Respected Companies.
The book is a must reading for business enterprises, both big and small, that want to survive in the rapidly changing environment of the Asian Century for at least the next twenty years and beyond. This long-term sustainability is impossible without the leadership of CEOs and other senior executives who take a very long-term view of their businesses. Dr. Canals has enumerated the attributes and qualities of a CEO that would guarantee the building of an institution that will survive the test of time. I would like to see more top executives in the Philippine business environment with these attributes and qualities.
According to Dr. Canals, the job of a CEO differs from that of a functional manager in various ways. A CEO must cultivate a comprehensive, integrative view of the organization and avoid taking a partial, functional or divisional approach to problems, challenges or solutions. As an independent director in the boards of a number of leading Philippine enterprises, I have observed that it is often difficult for the CFOs, CMOs, CPOs, CIOs or even the Human Resource Managers to transition from their functional responsibilities to the position of the Chief Executive Officer. They fail to realize that the CEO must orient the organization toward the long term, beyond short-term fluctuations, and contribute to the enterprise's long-term success and survival, beyond any failures in individual business units. Even functional managers with their MBAs from leading business schools here or abroad find it hard to accept the fact that CEO does not need to know more about finance than the CFO or more about technology than the CTO, but must be able to engage in a rigorous debate on any of these subjects. It takes time and a lot of trial and error for functional managers to assume the role of leading and working with the top management team and securing its commitment to the company's purposes: this is one of his core tasks.
In the view of Dr. Canals, the first attribute that a CEO should develop is a long-term perspective not only of markets, customers, products or competitors, but of all the areas and functions that help a firm become an institution: a mission, a set of values, a group of professionals, an organization and, of course, customers who have needs and who expect goods or service, which must be provided as efficiently as possible and at a profit. A good long-term strategy must be executed efficiently day to day. The CEO must be capable of looking to the long term and, at the same time, ensuring the proper quality in executing the different plans and policies.
A CEO must have a general management perspective. This means that he should have an integrated and holistic view of the organization as well as a good knowledge of the various functions, divisions and people. A CEO must combine an understanding of each of the company's units, divisions and functions with a thorough grasp of the whole organization. This is the only way that the CEO can help to develop the firm as an institution that will live beyond his term. This view is the general management perspective which looks at the long term while managing the short term. A good CEO constantly thinks of the firm's future, how the firm has to change over the next years and how the change has to be implemented. At the same time, long-term plans have to be considered simultaneously with the design of new plans and ideas and their implementation in the short term. (To be continued)