Developing tomorrow’s CEO todayFollow @PwC
Author: Ken Favaro, Senior Partner, Strategy&
Who will be leading your company in 2040? That’s when today’s graduates will be stepping into the CEO position, and he or she (that’s right, we expect one-third of 2040’s incoming CEOs to be women) will need skills for the complex environment of a quarter century from now—skills companies aren’t necessarily looking for, or cultivating, today. How can you begin your search for tomorrow’s CEOs?
First, consider the future landscape. As the chief executive class of 2040 climbs the corporate ladder, a major shift will occur: most companies will become either ‘integrators’ or ‘specialists’. Generally speaking, integrators will be large-scale organisations with distinct, solutions-based value propositions, while specialists will provide the individual products and services the integrators sell. This division of the corporate landscape suggests the need for a new breed of highly entrepreneurial, highly focused CEOs. Integrator CEOs will focus on dependable, reliable execution; superb supply chain management; and deep understanding of customers. The CEOs of specialty firms will need to be even more sprightly, shape-shifting entrepreneurs, adept at shifting strategies and entering and exiting businesses rapidly—tomorrow’s version of Silicon Valley’s ‘serial CEOs’.
Next, think about the passport stamps these young people will be acquiring throughout their educations and careers. Based on the analysis we conducted for Strategy&’s 2013 Chief Executive Study, we suggest searching out men and women who began developing their leadership, entrepreneurial, and collaborative skills in school. They should have experiences leading and working in teams, and spent time in at least one place that’s dramatically different from their home region. They may well be fluent in several languages, including programming languages.
Look for curious and innovative young people, who have invented something or who have a passion for nanotechnology, advanced robotics, or new energy and transportation ideas—and have turned that interest into a bona fide business.
An MBA will be de rigueur, as well as early-career international corporate assignments or perhaps a stint in a mission-driven service organisation. The CEO class of 2040 will need a worldliness, a respect for the power of diversity, an empathy, and emotional intelligence that far outpaces what today’s CEOs had at their age, and likely possess even now.
In preparing for the CEO class of 2040, we recommend taking the broadest view of talent development. Look far and wide; support schools and programmes that offer the best, most applicable experiences to tomorrow’s leaders; offer the widest and deepest possible array of experiences to promising young people; encourage women; and focus on deepening bench strength in the special skills that the future leadership of your company requires. And remember that CEO tenures are only about five years now—so with every CEO you choose between now and 2040, you’ll have a chance to move closer to this ideal.
Ken Favaro is a Strategy& Senior Partner responsible for enhancing the firm’s capabilities and reputation in value based management, strategic management, and organic growth, working closely with the organisation and change leadership team. His focus is on the consumer, healthcare, and financial industries. Read more.