The CEO arrived for yet another meeting with his cadre of executives to review corporate strategy and provide the leadership and direction on issues that have risen to the officer level. After all, the company needs strong guidance and decision-making to keep it on track to maintain its competitive focus, increase its market-share, please investors, and satisfy customers. It’s difficult and challenging to lead a corporation successfully year after year. Every decision could be the one that either topples the first domino starting the chain-reaction driving the company toward disaster or that exposes the CEO and his leadership team as unprepared to recognize or handle the events, conditions, and needs of the business.
The CEO would review the strategy that they were following and seek comments on current results, issues and risks. His leadership team would provide updates on their respective areas of responsibilities; each would present the recent successes and progress that they have made, they would describe any failures and the actions taken to resolve or mitigate them, and they would raise issues that required the CEO and leadership team to make a decision. Once discussed either a decision would be made or an action item to obtain additional information, analysis and recommendations would be requested. Ultimately, a corporate policy would be set to deal with the issue and with the decision the company would be tasked to make it happen.
The CEO then contemplates his efforts to make the company more successful. He acknowledges that he has pulled the right levers and will reap the rewards.
And thus the company is run day after day, month after month, and year after year. Even as CEOs and officers come and go, the company proceeds forward for better or worse. The CEO exerts his vision and leadership through his decisions and their resulting strategies. With such power the CEO shapes the company and its future. And that power is visible and felt throughout the company. Different departments and units are directed to work on certain activities and to drop or defer others. Company budgets get set to support the work and to provide a confirmation of the decisions and directions given by the CEO and this team.
The CEO looks over the company books (or has his Finance office report it out to him). He holds the costs down, invests company funds wisely, and hopefully watches his profits grow. Difficult as his job is, he is always aware that he must make these decisions for the company to prosper.
Sometimes the CEO establishes a policy and direction that causes contention within the company. Managers and workers are told to work on the new areas that the business wants to get into and succeed in, and they are told to keep the current business operations working but to avoid or not invest in those areas. With such direction, the Finance officer supports the CEO by ensuring that department budgets are held or reduced in existing operations so that funds can be freed up to invest in the new. This is nothing unusual; businesses do this all the time. The CEO’s decision thus also shapes how the decisions below him are likewise made. The CEO understands that the difficulty of his decision will require others below him to also make difficult choices.
Occasionally a department or manager will question the decision or will request some relief from the consequences that the CEO’s and derivative decisions produce on their organization. Throughout the layers between the manager or department and the CEO and officers, the issue will churn and produce tensions and difficulties. There will be times when the issue is resolved below the CEO by adhering to the original decision/policy. Sometimes the question will be accepted as a business necessity and the strict adherence to the corporate direction will be waived as unavoidable, but only until a path toward the designated goal can be achieved; and the CEO will not need to be engaged in resolution. Sometimes the CEO will have to be consulted and his consul will be required to resolve the question; but as always he well decide do this or do that. It’s simply another decision in the long chain of decisions that he must confront.
But what happens when the CEO’s decision is enforced on the issue that surfaced? The CEO, officers and various managers across the company see to it that the policies that they have set for the company are being used to drive the company in the right direction. Impacted organizations are challenged to react to and deal with the various problems that result. If the CEO says: Do not spend any more funds on that, then no more funds will be spent.
The world of course does not concern itself with what the CEO’s decision is. The CEO can decide what he wants, but he cannot make the results successful. The results will be what they will be. The consequences of the ‘laws of physics’ that apply to businesses will not be influenced by decree, dictate or decision. The CEO can decide that the company will not take a particular direction or do a particular thing. So the CEO can say that no funding will be provided to undertake a particular action and no budget will be set aside for it.
But when the business encounters a need that would be and could only have been addressed by funding the issue that the CEO decided was not consistent with his decision and his vision, the laws of physics will always win. The CEO cannot prevent the consequences of his decision, he is forced to accept and react to them. The CEO, his officers and everyone in the company are required to remember that you cannot decide how things turn out, but only how you are planning and forecasting how things will turn out. The first law of decision-making is to recognize that you cannot change those things that you do not control. You can choice to do something but it need not be doable or successful; and you can decide to not do something and it need not be avoidable.
Decisions are the dice you roll, but not the laws of physics that determine how they will land.
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