Friday, May 24, 2024

How has COVID transformed the Chief Executive role?

The CEO role has always had to adapt to change. For example, new technologies and the post-2008 era of business forced companies and leaders to be agile in the face of an ever-evolving economy. However, COVID has greatly accelerated this process. “The chief executive role is unique, particularly in the current atmosphere of complexity and volatility,” the experts at leadership advisory and CEO search firm Egon Zehnder explain. “These uncertainties require a pragmatic and aligned view on the business and leadership requirements of the CEO, one that must be reviewed regularly over the course of a transition.”

The unprecedented impact of the pandemic has called for the quick re-assessment of management skills that will allow businesses to make the move into the new epoch. This begs one question: what new qualities does a CEO need to bring to their organisation?

Adaptability first

COVID-19 taught businesses that operations are never static, to expect the unexpected, and prepare for potential hurdles. In order to do that, CEOs must be able to continuously adapt and upskill themselves, now more than ever. In a recent study of 1,300 CEOs, accountancy firm KPMG found that many chief executives have shifted their priorities significantly during the pandemic. According to Bill Thomas, global chairman and CEO of KPMG, this change is “a clear indication that businesses have had to pivot at breakneck speed to deal with the challenges of the pandemic” and that “business leaders the world over are seeking to manage uncertainty with decisiveness”.

Other CEOs have made similar observations. In his piece for Forbes, Wayne Elsey stated that “to succeed in a globalised world where we not only compete against each other but also have to deal with the immersion of artificial intelligence in our work, adaptability is vital for any form of success”. It is clear that a global crisis of this magnitude has tested the resilience of business models, showcasing that the key to success is the ability to adjust and adapt, as opposed to sheer economic force or brand recognition.

Greater sense of purpose

Traditionally, one of the most important business goals was unadulterated profit. However, recent shifts in the economy and the impact of COVID, in particular, have shaken this mantra. Now, it seems more and more business leaders believe that as well as on its bottom line, there’s a stronger focus on a company’s purpose and duty to society. The aforementioned KPMG study confirms this, noting that only 23% of CEOs saw an organisation’s sole mission as “managing for shareholder value”, while 54% believed being purpose-driven was essential to their role. Interestingly, 22% claimed that improving society through their business was their fundamental objective.

The pandemic has impacted everyone globally — albeit not equally, with some pointing out how it has even exacerbated wealth gaps — and CEOs are no exception, many of whom may have been personally affected by the health crisis. Perhaps this has made leaders re-evaluate what’s important in life.

The mistrust in governments over their handling of COVID has also been a contributing factor, with a recent survey showing that 81% of respondents believed it is important for companies to play a role in helping the environment, for example. Consumers now expect businesses to have a more meaningful purpose. This is the age of corporate scrutiny, and organisations putting profit before ethics are becoming less and less accepted — both by consumers and employees.

Technologically dependent

Although technology in business is nothing new, some companies had been hesitant to jump on the bandwagon — until COVID hit. The pandemic made the adoption of digital solutions a necessity rather than a choice, forcing businesses to adapt to new ways of working. This also proved to many leaders that productivity doesn’t decline while employees work from home, as long as the correct technology is being implemented. And the majority of CEOs don’t see this as a fad, but as an inevitable yet positive consequence of the crisis. In fact, 74% of businesses plan to permanently shift to remote working. This is also supplemented by the fact that 77% of the KPMG study respondents have said they will continue to expand the use of digital tools.

This process isn’t exclusive to remote work, though. The external-facing part of businesses is also benefiting from this sudden embrace of technology. KPMG found that more and more organisations are investing in a better digital customer experience (75%), as well as business models and revenue streams (64%). Overall, chief executives seem to be realising that consumers and employees alike are not looking to go back to the old way of doing things, and that, thankfully, tech can help answer their demands.

Empathy led

Sir Cary Cooper, Professor of Organisational Psychology and Health at Manchester Business School, commented in an interview for Raconteur that “in the pre-COVID-19 world, people moved up the promotional ladder on the basis of their technical, not people, skills — that will now change”. Emotional intelligence is becoming increasingly paramount in leading a business, especially now mental health is more of a talking point in wider society. The pandemic has encouraged people to be more open about their mental state, while it’s also created new anxieties and worries amongst workers. As people feel more insecure in their jobs, businesses will “need managers and bosses with people skills,” says Sir Cooper. If they don’t adapt, ”the employees won’t produce the goods and will get ill”. Bernard Looney, CEO of BP, argued in a webinar hosted by EY that “Not everyone will be infected by the virus, but everyone is affected by it. This is as much a mental health crisis as it is a physical health crisis and I hope we can now make mental health mainstream”.

COVID has also, in many ways, humanised companies. Suddenly, our meeting rooms are our kitchens, while pets and kids are in the background of serious business chats. “Conversations have become a lot more personal. There’s greater empathy, which is making companies more human,” Michael Dell, chairman and CEO of Dell Technologies, remarked during the same webinar. In the KPMG study, ‘talent risk’ jumped from 12th place to number one in a list of threats, showing how CEOs now consider employee engagement crucial to their role as leaders. Instead of putting competition first, human connection has become a valuable skill for the modern CEO.

Leading a business is never an easy task, and in an ever-changing world, it’s even harder. However, it appears that, despite the devastating effects of the pandemic, there’s a silver lining. CEOs are learning to adapt to a world that sees people for people rather than numbers.

Claire James
Claire James
Claire is an accounts manager at Fire Digital UK, an online publishing and content marketing company based in the North West.

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