The Role Of The CEO In Turbulent Times

While there’s always a steady stream of bad advice, it really seems to flow during periods of uncertainty—and this time is no exception. It is why the classics endure. But the problem, said Mark Twain, is that “a classic is something that everybody wants to have read and nobody wants to read.”

Fortunately, Peter Drucker is read and recognized as one of the brightest minds ever on leadership and executive effectiveness. The problem is that his most vital work for CEOs was unfinished at his death and remains largely unread. Published by The Wall Street Journal more than 20 years ago as a short article titled “The American CEO,” the article is especially valuable given today’s uncertainty and volatility.

Drucker explained there is work that only the CEO can do, and that they must do. Specifically, it is the role of the CEO—and only the CEO—to focus primarily outside the organization and to be the link back. The “outside” encompasses society, customers, the economy, competitors, the media, technology and public opinion.

While a few employees work on the outside, nobody else has the unique responsibility of interpreting the entirety of the outside back to the organization. It is the CEO who must adjust the organization’s strategy and tactics as “outside” realities change.

The outside, said Drucker, is where results live. The “inside” (or, your “organization”) by contrast, is only costs.

In today’s VUCA (volatile, uncertain, complex and ambiguous) environment, most CEOs see the very real dangers that exist. However, a CEO with an internal focus will likely overfocus on cuts—what they feel they can “control.” By maintaining a focus on the outside, a CEO can exploit new opportunities that are emerging.

Instead of lost supply chains, think localization of supply chains; instead of rigid competitive dynamics think opportunities for merger or acquisition; instead of chronic labor shortages, think of automation that may now be cost effective given now-unreliable overseas trading routes.

Drucker’s protege, Frances Hesselbein, was another one of those extraordinary leaders whose wisdom transcends her era (which is probably why Drucker chose her as his successor). Though we sadly lost Frances in 2022, she is forever etched in my mind, fixed on a stool at our annual CEO of the Year gala, inviting me to join her in a private toast.

Frances understood the importance of focusing on who you are, rather than what you do. For individuals, that means character and values, and for organizations, that means mission and purpose. In times of change, she taught the paradox that the ultimate response was to know what should never change.

Drucker and Hesselbein would undoubtedly advise you as CEO today to sharpen your unique value proposition—and double down by taking advantage of today’s chaos.