What Are the Duties of a CEO? Why A CEO Is Important For Your Business?
A CEO is the central pillar of the leadership of a company. Every large company has one, and from popular discourse, it is clear that they are responsible for a lot of major decisions a company makes. However, the mystical aura around a CEO and the grandeur of such a lofty position prevent people from seeing them as highly responsible individuals working under high-pressure environments where their decisions carry a lot of weight.
A CEO can lead not just one company but a group of companies too.
What is a CEO? What does a CEO of companies do? What are CEO duties and responsibilities? Find out all about the importance of CEO recruitment as well as about the CEO office roles and responsibilities in this blog.
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What Is A CEO?
Simply put, CEO stands for Chief Executive Officer. Not only do CEOs occupy the most important position in the company, but they are also responsible for leading the company through their strategic insight, mentoring other senior members, and taking important high-level decisions that can fundamentally change the company itself.
They are equipped with skills that cannot be compensated by the other board members, and they are answerable to them as well as other stakeholders in case anything goes wrong.
They serve as the public face of the company, manage resources as well as operations of the company, and are the point of communication between the board of directors and the corporate operations.
Who Can Be A CEO
There aren’t specific requirements set in stone about who gets to become a CEO. Companies have different preferences and ways of selecting one.
Generally speaking, a CEO should have a degree in management, finance, accounting, law, or public administration, as these skills are extremely valuable when making the biggest decisions for a company. They should also have a lot of experience and knowledge, along with a strategic mindset and goal-oriented way of thinking. CEOs often advance from within the company’s ranks, which ensures that they are familiar with the company and its structure.
Top Five Duties Of A CEO!
The duties of CEOs are numerous and diverse. CEO job duties also vary from one company to another. There are, however, duties of a CEO of a company that are common across businesses. Let us look at five critical CEO duties and responsibilities.
1. Articulate Strong Business Vision Into Concrete Business Plans
While low-level managers help with the day-to-day operational activities of the company, the CEO compiles these results into a cohesive whole and decides on a long-term plan for the company. He proposes a vision, a goal, or a target that he wants the company to achieve.
Once such a vision is set, the CEO’s duty is to ensure that a comprehensive, well-articulated, realistic, and reasonable plan is developed to make this vision a reality. Therefore the CEO not only points to where the company should go but also takes the company there. He has to decide on an abstract vision and a concrete plan both at the same time.
2. Increasing Revenues And Profitability
The CEO is ultimately responsible for the financial performance of the company. While he may take the help of other members like the CFO, who is more directly responsible for financial matters, it is the CEO’s duty to track data and metrics presented to him by the CFO and others and make important decisions to increase profitability.
While the CFO can only give recommendations, it is the CEO’s call as to whether the company will act on those recommendations or not. It is the CEO’s duty to track which areas are performing poorly, take remedial steps, and make sure to turn that into a profit eventually.
3. Designs The Best Talent Strategy And Ensure Higher Business Performance
The CEO also decides what kind of strategies the company should employ on basically all fronts: when to scale recruitment up or down, what financial risks to take, what kind of brand image to propagate, and other measures like cost-cutting and risk mitigation. Every step of the CEO is geared toward better business performance and is catered to make the company more profitable and enhance growth.
4. Supervises Top Executives And Management To Ensure Achievement Of Business Goals
The CEO also acts as the supervisor and mentor of other members at the topmost of the management. It is his duty to ensure that the top management is working as intended, as well as take remedial measures in case it is not.
The CEO can also sometimes train and educate the top management using his own experience and expertise. Interacting with other high-level executives also ensures that the top management works smoothly with each other, making the running of the company easier and more efficient.
Why CEO Is Important For Your Business
1. Top Management Evaluation
One of the key CEO office roles and responsibilities is focused on monitoring and evaluating top management performance. A CEO is crucial for evaluating the performance of other top-level executives.
A good CEO will be able to keep checks and balances on other executives, ensuring that they are working to their fullest potential and helping them if they are not. This way, the CEO becomes not just an evaluator but also a guide for the other executives.
2. Risk Minimization
Taking risks is a two-edged sword: a company’s performance can take a great leap forward if the risk pays off, but it can have devastating consequences if it fails. A CEO is able to make sure that risks are kept to a minimum and is also capable of mitigating risk through proper preparation and prompt action.
3. Increasing Market Value And Reputation
Since the CEO is the face of a company, a good CEO can make the market value of a company skyrocket and enhance its reputation. It is often seen how any missteps by the CEO can result in a drop in the stocks of a company. A CEO, if chosen properly, can truly boost market value by increasing trust among shareholders.
4. Ensuring Higher Business Performance
A huge part of the CEO duties and responsibilities are focused on managing a business. The experience, expertise, and leadership values of a CEO are geared toward making the company successful. A good CEO can truly change the fortune of a company with ambitious plans and well-implemented solutions.
CEOs are an essential part of the corporate structure and can fundamentally alter the company’s landscape. Therefore, it is essential that a CEO is chosen wisely and through proper mediation to make sure he or she is able to take the company further and pave a more ambitious path for the company to follow.
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