Sunday, November 20, 2005

CEO Work-Life Balance

We released a portion of our new research on CEO and corporate reputation this week. The results are thought-provoking when you realize that 51 of the 100 largest global economic entities today are corporations.

The CEO has traditionally had a legendary place in most cultures, a stature that often far exceeds their role as a mere business executive. Part rock star, part Type A workaholic, many have earned headline-friendly nicknames like “Chainsaw Al” or “Neutron Jack.” That’s why the results of our new global survey are nothing short of surprising. (
www.burson-marsteller.com/pages/news/releases/2005/press-11-15-2005) It seems a lot of our Type A’s have decided to focus some of their considerable skill and talent on the home front, displaying a newfound sensitivity worthy of Mr. Mom.

A survey of 685 senior executives from around the world found that 54 percent of these so-called business influentials would turn down the job of CEO if it were offered. And the number one reason for bypassing the corner office? It’s a desire to achieve a better balance between work and family life. The heck with the next rung on the corporate ladder, what time is soccer practice?

But beyond the unusual nature of these findings are some serious implications for both business and society. Given the post-Enron focus on corporate ethics and a rising rate of CEO departures, businesses have an urgent need to replace outgoing chief executives with a new generation of talented, ethical and credible leaders. But as more CEOs depart, the reluctance of many senior executives to accept the top slot will continue to hinder efforts to restore overall trust in companies around the world.

So why are so many people willing to say “No thank you” to what has long been considered the ultimate corporate job. Sixty-four percent cited the so-called family factor – the search for work/life balance -- as the leading reason they’re willing to pass up the top job. Clearly there’s a desire by many to avoid a schedule like the one recently described by Jeff Immelt, chief executive officer of GE, who told a national publication he routinely works 100-hour weeks and spends 60 percent of his time on the road.
(www.fortune.com/fortune/fortune75/articles/
0,15114,1101116,00.html)

But work/life balance is only one of the reasons some people would rather not be CEO. Forty-two percent cite the pressure – or as Novartis CEO Daniel Vasella called it the “tyranny” - of quarterly earnings, 37 percent noted the high stress level and 27 percent cited intense scrutiny by the press, shareholders and public.

To be sure, our survey also unearthed plenty of reasons why some still find the corner office worth pursuing, but they’re not the reasons you might suspect. Although the 3 P’s – pay, perks and prestige – usually dominate the headlines, those are fairly far down the list. There are more compelling reasons why many men and women still want to be your company’s next CEO.

For example, more than half – 56 percent – want the chance to solve complex problems, followed by significant percentages who want to have a personal impact on the business, the satisfaction of seeing their ideas implemented, and the chance to take a company from “good to great.”

So, armed with this information, what should companies do? And more fundamentally, why should they care? After all, despite evidence of growing reluctance to accept a company’s top job there are still plenty of people willing to take the plunge. The key is finding the right person. Corporations are under immense pressure to build a good reputation, and our research has repeatedly found that a company’s reputation is tied directly to that of the man or woman at the top. In fact, we’ve consistently found the reputation of the CEO is directly related to the company’s prosperity, standing and destiny.

The good news is that the findings of the survey provide some insight into how companies can manage the challenge of building the next generation of global leaders. We think it’s critical, for example, that companies provide their future leaders with real-life training and realistic strategies for balancing life and work, managing stress and dealing with public scrutiny. Corporate boards should mentor rising stars to make sure they’re comfortable on the fast track. Upcoming leaders should have the resources to build the strongest senior management team. And, if possible, companies should give incoming CEOs time to get their sea legs and perfect their leadership skills out of the public spotlight.

As we see a rapid rise in the rate of CEO departures and greater focus on corporate conduct and performance, the need has never been greater to build the next generation of global leaders. CEOs are increasingly challenged by time zones, fluctuating global markets, unpredictable crises and an expanding roster of stakeholders demanding their attention. All of which makes it harder to maintain the balance between work and home that a growing number of executives indicate is important. The extent to which companies help upcoming qualified CEOs find that balance will go a long way toward determining their success in the marketplace.

Those are my thoughts for our next leadership generation. lgr

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