During my economics degree, I had to take a course in strategic business management. I wasn’t particularly interested in the question of how to get to the top of a company, because I didn’t think it was as relevant for a career as a researcher.
It only became clear to me long after my studies that even as a scientist you should be able to manage a research institution in the best of circumstances. I was able to find that there are interesting findings on this.
Steven Kaplan and Morten Sorensen have analyzed more than 2,600 assessments of candidates for senior and most senior management positions. Applicants for these positions are in themselves an above-average educated and successful group of people. Even so, those who qualify to be Chief Executive Officers (CEOs) are distinctly different from the rest.
Those considered as candidates for a CEO position tend to have better intellectual abilities, are more effective, have more charisma and are more strategic in their approach to tasks. Interpersonal skills then play an important role in the actual appointment to the CEO, i.e. not just “doer qualities”, but also prudence, respect and empathy when dealing with people.
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Once at the top, CEOs run their companies in different ways. However, recent research by Oriana Bandiera and co-authors suggests that there are two main leadership styles of CEOs.
Based on the schedules of 1,100 CEOs of large companies from Brazil, Europe, India and the US, the research team analyzed how top managers approach their tasks.
Two different types of CEOs
They recorded the duration and type of activity every 15 minutes – for example, whether it was a meeting, a business lunch, a tour of the company or preparation time for a meeting. The number, rank and internal or external status of the participants in the meetings were also recorded. Using machine analysis methods, the economic researchers identified two types of CEOs.
“Manager” CEOs hold bilateral meetings relatively often, deal more with aspects relevant to production and are relatively often on the road in different departments within the company.
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In contrast, “leader” CEOs spend more time in meetings with more than two people, who usually come from different areas of the company and from there from the executive staff. They care less about the operational and more about the strategic decisions of the company.
Leader CEOs tend to run more productive and profitable companies. However, Bandiera and colleagues emphasize that the fit between corporate culture and CEO leadership style must be right.
More: These 23 top-paying jobs will be in high demand in 2023.