According to a survey conducted by business management systems provider Khorus, CEOs are largely out of touch with day-to-day progress toward business goals in their organizations. The company polled 200 CEOs of organizations with 50 or more employees about their roles, challenges, processes and initiatives.
“The results paint a bleak picture: CEOs are operating blindly much of the time, with little reliable data into how the business is meeting its goals until it’s too late to make a difference,” said Joel Trammell, CEO of Khorus. “Much of the data they do receive is random, outdated, and detached from business outcomes. The upshot is that CEOs are squandering valuable time that should be spent setting priorities that all employees can track to, making timely adjustments, and driving the business forward.”
While nearly 70 percent of the CEOs surveyed have had previous experience as a chief executive, three-quarters have spent five years or less in their current role. The average CEO tenure is about five years. All CEOs surveyed indicated having internal business performance challenges. Top reasons include:
• Aligning employee output with corporate objectives (59 percent)
• Capturing and predicting company performance (57 percent)
• Generating cross-department collaboration (49 percent)
• Improving employee motivation (34 percent)
CEOs are running their businesses primarily via e-mail (64 percent), calendars (17 percent), and spreadsheets (15 percent). When asked specifically what tools they are using to predict business performance, almost half of CEOs said they are using enterprise resource planning (ERP) tools, while one-third use Excel spreadsheets, and nearly 18 percent use human resources tools of some kind.
However, almost half of CEOs also cited these same tools and applications as the biggest hurdles to knowing their true quarterly business performance at any given time:
• 49 percent blame clunky ERP and business performance management tools
• 49 percent blame management KPIs that are functional (isolated to individual departments) and not normalized across areas
• 48 percent blame poor visibility of performance beyond direct reports
The survey indicates that CEOs are often the last to find out about problems. Asked when they find out if their quarterly corporate goals are being met fully, CEOs are getting progress reports at the earliest:
• 48 percent said monthly
• 32 percent said quarterly
• 10 percent said weekly or in near real-time