Got what it takes to be CEO?

It takes a brave individual to take on the mantle of business leader, what with the many expectations and, often, constant criticism of staff to endure. So what qualities does it take to be a successful CEO? asks Stefan Stern

A funny thing happens on the way to the chief executive's office. All those years on the way up, we whinge about our bosses, bemoan their blind spots and insensitivity, and wonder out loud how they ever got the job when they are clearly so inadequate.

And then one fine day, for a very small number of people, that whinging employee becomes the boss him/herself. Does the new leader remember all those years of frustration, those hours spent slagging off the CEO, those long speeches made late into the night which began: 'I tell you this, if I ever get to run this company…'?

Of course not. The new boss gets stuck into the job, and forgets most if not all of the angry promises made only a few years earlier.

This fact probably tells you two things. First, that human beings are flawed creatures who continue to repeat the mistakes of their predecessors in spite of their best intentions. And second, that being a boss is even harder than it looks from the outside.

Consider the traditional observation that 'it is lonely at the top'. Until you are at the top, it is impossible to know how true that claim is. But bosses appear to have a never-ending stream of advisers, senior colleagues and high-level contacts to talk to. How lonely can it really be?

Ah, but bosses tell you, it is lonely, precisely because there is hardly anybody you can confide in. You cannot really tell fellow directors that you are anxious about the strategic path you are taking, in case it signals weakness or indecision. You are supposed to be in control. It is very hard to know who if anyone you can trust.

Then there is the question of understanding and mastering all the different aspects of your firm's business. You will probably have made it to the top - if you have done - by excelling in one or, at most, two different disciplines or market-places. But then, there you are suddenly in the chief executive's seat, being expected to understand data coming in from all over the world, reflecting all kinds of different activities.

'We constantly underestimate the difficulty of making the transition from, say, a marketing or finance role to becoming head of the whole organisation,' says Richard Balaban, managing partner of consultants Oliver Wyman. 'There are just not that many people who are going to be capable of making this big step up.'

Even if you can develop good enough 'domain knowledge' of different disciplines over the years - and companies can help in this by investing much more seriously in their leadership development work, and mapping out the career paths of their 'high potentials' - the question then arises as to whether you have the right personal skills and approach to make an effective leader.

So much of the 'leadership literature' analyses leaders themselves, saluting great CEOs of the past and urging readers to mimic their way of doing things. Or, worse, instant blockbusters are written about leaders who appear to be successful for a limited time, but who are already on the way out by the time the book hits the shelves.

The great virtue of Rob Goffee and Gareth Jones' 2006 publication, Why Should Anyone Be Led By You?, is that they researched the views of followers as well as leaders, i.e. the people who were actually being led. These two London Business School professors have done leaders a service by identifying the qualities that staff say they are looking for from their bosses.

Four key qualities or characteristics emerged from their research. First, employees told the authors, they wanted to feel part of a community at work. Even in these days of outsourcing and 'lean and mean' efficiency, workers want to feel part of something with a distinct and appealing identity. It is up to the leader to try and start creating that sense of community.

Second, employees want their bosses to be 'authentic'. They can spot a fraud a mile off. In the past, leaders could use the mere fact of their position in a hierarchy to maintain a degree of control. In our less deferential age, with a better educated and more sceptical workforce, it is much harder - probably impossible - to pull that trick off over the longer term.

Third, employees want a sense of excitement (or 'fun') at work. This is clearly asking a lot, especially in a slowing economy like the one we have today. Nonetheless, the best leaders realise that bored workers, sick to death with drudgery and repetitive tasks, are not going to be productive or offer the sort of customer service you need from them.

And lastly, employees say they want their work to feel significant. They won't just keep turning up every day to do something that does not matter at all. Self indulgent? Or real? You decide - but that is what the research has shown, and, as anyone who works with demanding 'Generation Y' colleagues will know, younger workers have very high expectations of work and careers these days.

Keeping it simple

So, at the risk of delivering the kiss of death to some of today's star CEOs, who is getting this leadership business right at the moment, and who is getting this wrong? Sir Terry Leahy at Tesco does not seem to put a foot wrong. He keeps things simple. He is relentless in the pursuit of success. But he understands that his business revolves around two basic tasks: keeping customers happy, and keeping the staff happy. To achieve the first goal he also has to achieve the second.

In the 'bad boys' camp - without worrying the libel lawyers - we can safely place 'Chainsaw' Al Dunlap, one of the most notorious downsizers of the 1980s. He famously observed that he did not expect loyalty from his staff. 'If you want a friend, get a dog. I'm taking no chances, I've got two,' he once said.

'Effective leaders are authentic chameleons,' say Rob Goffee and Gareth Jones. 'Although they show who they are, they are not easily stereotyped. Because they show emotions and withhold them; get close and stay apart; are like us, but different; their colleagues often see them as possessing enigmatic qualities.'

Leadership is always big news - no more so than now, with the US primary season in full swing. Wannabe Presidential candidates are displaying their leadership credentials non-stop.

Senator John McCain has belittled his rival Mitt Romney as a mere manager, not a leader. Romney, once Governor of the state of Massachusetts, also founded Bain Capital, a hugely successful venture capital fund. Romney often refers to his management of the 2002 Salt Lake City Olympics, which he pulled back from the brink of disaster, as an example of his management skills. But McCain is not convinced. 'I spent 22 years in the United States Navy. I led - not managed - I led the largest squadron in the United States Navy, over a thousand people and hundreds of millions in assets,' McCain has said. 'I'll put my leadership - not management - but leadership credentials up against anybody's.'

Another Republican rival, Mike Huckabee, has also belittled Romney and his 'managerial' ways. 'People are looking for a presidential candidate who reminds them more of the guy they work with rather than the guy that laid them off,' Huckabee has said.

So, wannabe leaders, here is your simple task: be approachable yet authoritative, be authentic but not schmaltzy, be resilient but also flexible, be decisive but also know how to listen.

How hard can that really be? Be honest - do you still want the job?

Stefan Stern writes a column on management for the Financial Times.