Just as the mitochondria is the powerhouse of the cell, the CEO is the powerhouse of the company. Finding the right CEO is essential to the survival and ultimate success of a corporation, but it isn’t always easy. The wrong match could spell disaster, but if you know what you’re looking for in a CEO it shouldn’t be too hard to pinpoint the perfect fit.
The practice of hiring CEOs externally, rather than promoting from within the company has been in vogue for years for a variety of reasons. In 1970 just 10% of CEOs were hired from the outside, but today that number is at almost 30%. In a study focusing on 51 CEOs of publicly owned tech companies, those that were hired internally showed on a 35% revenue growth over three years. Their externally hired counterparts however saw a 99% revenue growth over the same three year period.
So what makes external CEOs better than internal promotions? It has been shown that internally hired CEOs are far more likely to stick to the status quo and follow old rules and standards. They are less likely to listen to new ideas and branch out creatively. CEO experience is also something that is invaluable to someone you want as your CEO. Hiring externally someone who has already been a CEO is a better bet to hiring someone internally who obviously doesn’t have the right skills.
While not everyone is looking for a CEO, this infographic gives some interesting insight into what it takes to be one. Check it out for more and let us know what you think in the comments, and don’t forget to like and share.