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What Only the Person in Charge Can Do

What is the work of the person in charge? A.G. Lafley, CEO at Procter & Gamble, provides some fundamental answers to this with his article, "What only the CEO can do."1 The CEO role presents special challenges, and Lafley shares the unique tasks CEOs must perform.

Lafley's list of the actual work of the CEO can be applied to the work of other people in charge at any level. This newsletter will apply Lafley's four distinct CEO tasks to the work of general managers who must identify opportunities and execute plans to seize those opportunities.

Deciding What Business You Are In
For the CEO this involves identifying market spaces where the company is, should be and should not be. For example, Reed Hastings of Netflix is constantly working on this question, as he knows that the DVD rental business will decline soon. Reported recently in The Wall Street Journal, Hastings almost made the mistake of getting into the digital hardware business (making a set-top box that would stream video to TVs).2 He finally decided after much investment that hardware was not the business his company was in.

For people in charge at other levels, the principle still holds true the task is to clearly identify the scope of the project, function or division. Clarity on the scope is not only helpful in determining what will be done but what won't be done. It is easy for the project or unit to get lost by expanding the scope beyond what it can do well, or diverting focus from what is critical. Scope can be clarified by answering three questions:

  • Where does the need exist? (What market are you trying to serve? For a project this might be internal.)
  • What will meet that need? (What service or product will you deliver?)
  • How will the need be met? (What special knowledge do you bring?)
For example, a marketing V.P. in a publishing company considers opportunities to generate added revenue from her department. Each option should be measured against the three questions above, as there are many good ideas that don't fall within the department's scope. Specifically, she may choose to focus only on those opportunities that also will increase circulation or extend the brand.

Defining the Meaningful Outside
For the CEO this is a critical task because "everybody else in the [company] is focused much more narrowly and for the most part, in one direction" (Lafley). An effective CEO looks at external entities critical to success. Netflix's Hastings needed to create alliances with Hollywood studios to gain access to films to be streamed to customers. This is not a simple trans-actional relationship and must be approached strategically.

For those in charge who are not CEOs, it is still critical that they define the outside, as that is where the opportunity lies. One tool for defining this outside is drawing a strategic map and defining the relationships required with those entities outside the unit but critical to its success.

Balancing Present and Future
A CEO must do both. Says Lafley, "We must work on the present to earn the right to invest in the future." Hastings and Netflix provide a prototype case study as the company focuses on new businesses and markets at the same time it churns revenue (at a profit) for a business he sees dying within four years.

For those in charge of projects or functional units, planning for future contingencies is still relevant. For example, the marketing V.P. sees that resources are going to be cut within two years (an inevitability in maturing businesses). Planning ahead allows the manager to position the unit for that reality by restructuring and eliminating unnecessary work.

Shaping Values and Standards
This is about setting clear expectations and reinforcing them constantly. For Lafley, the issue he confronted was to refocus the company values on the customers' needs rather than the employees' wants again a way to retain focus on the outside rather than the safe and insulated inside. Also, the CEO must identify the critical measures that define success.

In essence the leader is the CEO of the project or unit. Being able to set expectations and define success is important for all those in charge. Specifically, creating expectations for specific results is the job of the manager as is establishing sentiments and norms that ensure high performance. Being in charge has its own unique work. Make sure you are devoting adequate time to doing it right.

1What only the CEO can do," by A.G. Lafley, Harvard Business Review, May, 2009.
2"Netflix bosses plots life after the DVD," by Nick Wingfield, The Wall Street Journal, June, 23, 2009, p. A1.

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