There’s more to being a CEO than the title. They take responsibility for the success and failure of their companies.That explains why they are often described as the ultimate power in any organization. CEOs spend long hours in the office, make tough business decisions, and face enormous challenges that most people don’t know about. In this article, you will learn about some of the habits of a highly effective CEO.
Being a Chief Executive of a large company is one of the most challenging tasks in the world. The scope of the CEO’s job is vast.
At all times, you are dealing with different functional agendas, business units, and external issues.
You will also have to deal with your organization’s shareholders, customers, employees, the board, media, government, etc. You see, being a CEO is more than sitting down in the office and giving instructions.
And to succeed in this role, you have to be effective and proactive. So, here are 7 of the habits of a highly effective CEO. Try to imbibe these habits to become successful as a chief executive.
#1. Always Think of Ways to Raise Fund for the Company
One of the habits of a highly effective CEO is to be eager to raise funds for the company.
It’s very challenging and time-consuming to raise funds for any company. It doesn’t matter whether it is a large corporation or startup; it’s important to be in a fundraising mode.
To be in a fundraising mode, a highly effective must do the following;
- You must have a current investor pitch deck that you can easily send to investors when needed.
- Be friendly to your investors and respond to their inquiries.
- Have a continuous PR and marketing campaign that can reach your potential investors.
- Tell your board of directors, company lawyer, and existing investors to introduce you to new investors.
- Always have a thought-provoking and high performing 30 seconds elevator pitch ready to deliver at all times.
- Create an online data room where you keep your company’s major contracts, corporate documents, intellectual property information, employment agreements, and other information that a potential investor can easily review for due diligence.
#2. Monitor Your Company’s Key Financial Metrics
The readiness to monitor a company’s key financial metrics is one of the habits of a highly effective CEO.
It’s part of your duty as the Chief Executive to continuously monitor, evaluate, and analyze your company’s financial metrics.
Interestingly, you don’t need a finance or accounting background to do this. Just follow the figures, and when you see anything unusual, you can call contact your CFO to explain.
Not monitoring your company’s financial metrics can affect your business negatively.
Even if you trust your Chief Financial Officer or VP of finance, you still need to have an overview of your company’s finances. It will help you make key financial decisions easily.
Depending on the industry your company operates, it’s important to take note of the following monthly financial metrics;
- The company’s monthly positive cash flow.
- Your company’s gross revenues.
- Gross Margin (Gross Margin refers to the difference between your company’s revenue and the cost of goods divided by revenue). The gross margin is always expressed in percentage.
- Your customer acquisition cost and the lifetime value of a customer.
- Account payables.
- Account receivables.
- Cash in Bank.
It’s important to have an idea of these financial metrics. They will help you to make quick financial decisions when the need arises.
#3. Continually Update the Board of Directors and Investors
Updating the board of directors and investors is one of the habits of a highly effective CEO. Your board of directors and investors are the backbone of your company.
So, whenever you want to make a major decision, it’s important to carry them along. Your board of directors and investors are key stakeholders in your company. And they won’t like surprises.
It’s necessary to notify your board whenever any of the following issues come up,
- When there’s litigation or threat of litigation
- When the company loses a major customer or client.
- If there’s any claim of sexual harassment or discrimination
- When you want to deviate from the board-approved budget, especially if it requires additional cost.
- A data breach or cybersecurity issues.
#4. Hire a Great Team
Putting a great team together is one of the habits of a highly effective CEO. You can’t do the job alone.
You need reliable, efficient, and productive employees to achieve your organization’s mission and vision.
So,make effort to put together a remarkable team that can help you achieve your organizations’ goal. It’s also important to employ people who can easily adapt to the company’s culture and imbibe the values.
#5. Delegate Tasks
Like I mentioned earlier, you can’t do everything yourself as a CEO. You need to delegate tasks to some of your employees; otherwise, you may be prone to burnout.
Your job as a Chief Executive is not to do the grunt work. You should focus more on making important decisions and developing strategies to grow the company.
But before you start delegating tasks, try to observe your team closely, identify their talents, and delegate your tasks based on their capability.
#6. Read Books
Reading books is one of the everyday habits of a highly effective CEO. If you want to become an effective CEO, you need to read more business books, autobiographies, self-development, etc.
Reading exercises your mind, makes you think faster, and helps you gain insights to make great business decisions.
Networking is one of the habits of a highly effective CEO. Every chief executive must take networking seriously.
Learn to network with people within and outside your industry. Try to accept important meeting invitations, event invitations, even though they aren’t sales related.
With this attitude, you will build a reliable network over time. Don’t forget that having a reliable network is an important part of running a business.
These are some of the habits of a highly effective CEO. These habits will make you a better, more effective, and reliable leader.