Defining a CEO’s Success – It’s About Profit
The standard for measuring a CEO’s competence isn’t solely based on revenue or flashy statistics. It’s about profit, plain and simple. A successful CEO knows that the bottom line matters the most. It’s not about making $5 million last year if you spent $6 million. True success lies in making a profit, ensuring that the company’s financial health is thriving. Therefore, the first and foremost duty of a CEO is to maximize profit, ensuring there’s more money in the company’s checkbook at the end of the day.
To accomplish this, a CEO must be responsible for crafting a strategic plan that outlines the path to future expansion. This plan revolves around four pivotal pillars: marketing, sales, delivery, and management. These pillars are the cornerstone of any successful business, and the CEO’s role is to map out a strategy that addresses them all. Once the strategy is set, the CEO works alongside managers or handles the responsibility personally if no managers are in place to develop action plans, breaking down the strategy into actionable steps with timelines.
Ideally, a CEO aims to build a team of executives, including a Director of Marketing, a Director of Sales, a Director of Delivery, and an Administrative Director. This structure allows the CEO to step into a higher-level role, overseeing and guiding these executives while focusing on the bigger picture of business growth and profitability. In essence, a good CEO ensures the company operates like a well-oiled machine, with each component working in harmony towards profitability.
Effective Communication – The CEO’s Vital Role
While people may view CEOs as aloof figures in ivory towers, the reality couldn’t be further from the truth. Effective communication is the lifeblood of any successful business, and the CEO plays a pivotal role in ensuring that communication flows seamlessly throughout the organization. Even if you’re a small business owner working solo, you need someone to talk to, bounce ideas off, and provide direction.
At Matterhorn Business Development, we’ve witnessed that many small business entrepreneurs find themselves in solitary roles. That’s where we step in, offering guidance, ideas, and direction. As a CEO, you must take these strategies and action plans and communicate them clearly to managers and team members. Your team needs to know the company’s direction, their specific roles in achieving goals, and the importance of their contributions.
Take the example of a successful CEO who oversaw a company’s meteoric rise from zero to a $3 billion valuation in just seven years. This CEO wasn’t aloof; instead, he was actively involved in the day-to-day operations, ensuring that communication flowed efficiently. He was present and engaged, demonstrating that CEOs are not distant figures but active participants in the company’s journey.
Navigating the Nitty-Gritty – Accounting and Compliance
Running a business involves more than just the grand vision and strategic plans. CEOs must also attend to the nitty-gritty details that keep the business running smoothly. One such critical aspect is financial management and compliance. It’s the CEO’s responsibility to ensure that the company’s finances are in order.
This includes meeting with accountants regularly, filing taxes on time, maintaining an up-to-date profit and loss statement, and addressing any legal or regulatory requirements. It’s not a task that can be delegated entirely to others; the CEO must oversee it personally to guarantee that the company remains in compliance with all necessary regulations.
Whether it’s drafting legal documents, renewing retail merchant licenses, or handling state and local regulations, the CEO must navigate these challenges to keep the business afloat. Neglecting these aspects can lead to severe repercussions, including financial penalties and damage to the company’s reputation.
Putting the CEO’s Face Forward – Promoting the Company
Lastly, but certainly not least, CEOs must be active in promoting their companies. This involves more than just sitting in an office and making decisions. It means getting out there, networking, creating content, and building a strong public image for the company.
In some cases, small business owners might shy away from this aspect, believing it’s not their forte. However, promoting your product or service is an integral part of being a CEO. If you’re not comfortable doing it yourself, consider hiring someone who can handle public relations and promotion on your behalf. But remember, your company’s image and reputation are ultimately your responsibility as the Chief Executive Officer.
In essence, the role of a CEO in a small business covers several key functions. It begins with the pursuit of profit, where a CEO must maximize revenue while controlling expenses. It extends to creating and executing strategic plans encompassing marketing, sales, delivery, and management. Effective communication with the team is vital, ensuring everyone is aligned with the company’s goals. CEOs must also handle the technicalities of accounting and compliance, ensuring the business maintains its financial stability and legal compliance. Lastly, promoting the company and building a strong public image is part and parcel of being a CEO.
If you’re looking to enhance your CEO skills and take your business to new heights, consider exploring our Adventure to Profit program at adventuretoprofit.com. Through this program, you’ll have the opportunity to work with certified Profit First professionals, dive into strategic planning, and gain personalized guidance to propel your business towards success. Don’t hesitate to take the leap into becoming a better CEO – your business and its profitability depend on it.
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About Greg Winteregg
Greg founded Matterhorn Business Development to assist small business owners in growing their businesses and increasing profitability at the same time.
He was an internationally recognized lecturer, sales trainer, and management consultant who spent close to 30 years working with professionals and small business owners across the US and Canada.
In 2019, he authored his book “Fun at Work.”