Forums: Discussions for entrepreneurs and small business.

Katherine,

I believe the President has the fun job and the CEO makes it happens. Also make sure this fun job allows you time to come up with somehting else. You wanna be able to keep on thinking outside the box, cool?

Augusto

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Augusto R.C. D`Oliveira
55 (12) 3029-0877
55 (12) 8821-3200
www.myenglish4you.com

A Chief Officer of any kind, Executive or otherwise, is charged with the *strategic* pathway of a company. That means understanding the difference between:

• Strategy
• Tactics

By way of example, think about a group of people who want to go from point A to point B. They encounter a mountain. The "strategy" is to 1) figure out a way past the mountain, 2) not get killed in the process, 3) consolidate at the other side and figure out what comes next.

The "tactics" are the details. Do we blow up the mountain, cut it in half, drive over it, climb it, tunnel through it, walk around it, or call it quits and go home.

Strategy is a method of optimizing one`s path toward a goal. That optimization refers to and includes a final meaning for that goal---why are we doing this.

Tactics are the specific approach options for overcoming particular obstacles along the path toward a goal---how will we do this.

The CEO focuses on strategy---what`s the long-term goal(s) for this business. The President focuses on tactics---how can I get each thing done along the way.

In US politics, the President is the captain of the ship for 4 years, making moment-by-moment decisions regarding whether or not to do something right now. The political party is analogous to the CEO, formulating the overall historic goals of the future of the country.

Because of its structure, the President can also play the role of CEO, having a far-reaching "dream" of how the country will be after the Administration is gone. The heads of staff, Cabinet members, and chief operations people (like the Pentagon`s Chief of Staff) then handle the tactical details of achieving the vision of the President---now acting as CEO.

Imagine a football game. The goal is to win, scoring points. One strategy would be to overwhelm the other side by strength and numbers. No matter what happens, the overall plan is to always use force. Another strategy is to sneak by everyone when they`re not looking. The overall strategy is stealth.

The coach is the CEO. The quarterback is the President. The coach says we`re going to sneak by everyone, throughout the game, whenever possible. The quarterback then calls each play, designed so that many players fall on other players, and when nobody`s looking, one guy runs to the end of the field.

Strategy carries little moral judgement, it`s only a plan. Tactics do carry moral and ethical values. Playing the game is a call for a strategy to win. But playing by the rules is a tactical decision, and cheating carries an ethical value.

Craig,

Are you sure you don`t have that backwards? Isn`t the President of the company the one that focuses on strategy and the CEO on tactics? I know you are gonna say "yeah I`m sure" so can you prove it, like sending me some liks to a couple of websites that talks about it or something of that sort. Nothing personal! It`s just that I`ve actually read somewhere that no one really knows the true description of the President`s job.

Augusto

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Augusto R.C. D`Oliveira
55 (12) 3029-0877
55 (12) 8821-3200
www.myenglish4you.com

I have no links, and use as my proof only reason and having seen the org charts of whatever number of companies.

Instead, I`ll leave my argument as is. If it`s wrong, anyone can ignore it. Otherwise, people with greater wisdom and knowledge will correct it, or reverse it.

Craig,

Great remark! Check this site http://entrepreneur.com/management/growingyourbusiness/artic le174620.html , it has to do with what I asked of you.

Augusto

 

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Augusto R.C. D`Oliveira
55 (12) 3029-0877
55 (12) 8821-3200
www.myenglish4you.com

Hi Augusto,
I`m aware that lots of companies nowadays play all sorts of games with acronyms. There was a time when CIO was so new, nobody understood the function. That`s a "Chief Information Officer," someone who would develop the outlook and strategic implementation of computer technology.

Now, just as people are starting to know what CIO stands for, we have CTO, the Chief Technical Officer. Why? Nobody knows.

In your reference article, the unstated key phrase is "keep your eye on the ball." So for example, when a company is about to go public they might bring in a CEO who has a wider context than just running a business. In a turnaround situation, the CEO holds a rigid eye on the overall point of the company, its core line of business, and the bottom line.

All these are strategic visions. In another scenario, with global enterprises, the CEO is higher in authority than multiple Presidents. Those Presidents would run subsidiaries, foreign divisions, whole product lines, and so forth. Someone has to be at the pinnacle of the pyramid, given the typical hierarchical structure of most organizations. "Owner" trumps CEO :-) But an owner sometimes gets so buried in running the business, they forget why the business exists. So they might bring in a consulting CEO to keep the "overview" in sight.

It`s not unusual for a CEO to act as the overall tactical manager of a company, particularly in turnaround situations. It consolidates authority into a single position, reduces labor and salary costs, and blah blah blah. Who cares?

What matters is to understand the fundamental distinction between strategy and tactics. Knowing which set of events is taking place, we can then look to the decision-maker of those operations. If they have no "title" on their little plastic name-tag, we can call them according to their function.

The title CEO doesn`t "make" anyone a decision-maker. It doesn`t "cause" someone to think strategically. Words come after observations. Words don`t cause reality to exist. We don`t live in a magic framework, where casting spells produces tangible reality. :-)

Most companies don`t need both a CEO and President, except that it looks really awesome, dude, on a business card to say you`re "President & CEO of ThisCompany, Inc." :-D Y`know?

A better distinction is between the Chairman of the Board and the President of the company. Most people don`t know what`s the function of a board of directors, either. But this post tries to differentiate Chief Executive Officer (CEO) from President.

I`d be happy to read other suggested defining characteristics. :-)

President is a legal position, i.e. according to state corporate codes. CEO is a tittle to inflate the top dog`s ego, according to a company`s by-laws.  Practically CEO is top dog, who can fire the president unless he`s also the president.  If one search California Corporate codes, CEO is never mentioned.

Some top dog call himself CEO, chairman, president, secretary, and of course, janitor too.


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I hate acronyms. It creates less text, but makes me loose the meaning of the words. I don`t really understand why we have titles... except to help describe what we do.

If I am a "resident manager" you know exactly what I do.

If I am a "CEO" you only know I handle issues near the top of the business structure.


I once worked for a printing company, which is still going strong today. When I first started, as a beginner pre-press operator, they asked me, "What title do you want on your business card?" I said, "You mean, I don`t automatically get the title of `pre-press operator assistant,` or `graphic design assistant?`"

The answer was... "You can have any title you want. We don`t really care." Being facetious, I said, "How about `Web Development Manager.` OK, they said.

I was shocked to be honest. I changed my title to graphic designer before it went to press. I didn`t even know how to program HTML at that time.

So I immediately realized, a title doesn`t mean crap. How many other companies put such a small amount of importance on titles? By the way, this is not small printer. They currently do about $10 Mil. a year. Not huge as far as printing is concerned, but good enough to be considered a "real" business.

I guess what I saying is that an acronym title is only as good as the experiences and accomplishments you can list afterwards. And those accomplishments are also just a matter of perspective. You can`t believe everything you hear or read.


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Vincent Wilcox (a.k.a. KRAKR)
Drummer
My band: Letters Make Words