The Five Faces Of The 21st Century Chief
James M. Citrin, corporate kingmaker, has long had a close-up view of the leadership demands of the world's most dynamic companies. As founder of Spencer Stuart's technology, communications, and media practice, the executive recruiter has placed 165 chief executives, chief financial officers, and directors since 1994. Big catches include David L. Calhoun, a General Electric (GE ) star he helped lure to private equity-owned VNU (now Nielsen); Eastman Kodak (EK ) CEO Antonio M. Perez; and Motorola (MOT ) chief Edward J. Zander.
From his perch, Citrin has watched CEOs of public companies fight a losing battle against the spiraling demands on their performance and time. "The job of the CEO has become so consuming and complex that if you actually list all the things a CEO is responsible for, no human being can do them all," he says. Add to that a tightening market for talent as more stars jump ship to private equity, and it's clear to him the model of the public-company CEO must change.
Over the next five years, Citrin believes boards will need to embrace the concept of the "specialist CEO." Boards of directors, he says, will need to get more realistic about the rarity of the perfect CEO. Rather than holding out for leaders who are expert at everything, they should instead warm up to CEOs with deep expertise in one or two crucial areas and enough knowhow in the rest to build a high-performing supporting cast.
Citrin believes a change in what boards focus on may prompt a shift in the C-suite's structure. More chief operating officers will be near-equal partners, and more leaders with specific functions, such as heads of human resources and marketing, will interact with the board. In the future, Citrin expects five specialist CEO types to be in the greatest demand:
Whether they're algorithm geniuses, coding prodigies, or merely credentialed scientists or designers, CEOs in touch with their inner geeks will be a sought-after breed. As global competition intensifies the pressure for top-line growth, innovators-in-chief will be more clued in to the next breakthrough business. Plus, their expertise will help them inspire engineering and research and development teams.
ARCHETYPE: Arthur D. Levinson, the CEO of Genentech. (DNA ) Levinson has a PhD in biochemistry and is known for sending out late night e-mails to his researchers on details in scientific papers. Citrin also cites Reed Hastings, founder and CEO of Netflix (NFLX ) and a former software engineer, who Spencer Stuart placed on Microsoft's board.
A two-year stint in London may have counted as enough international experience in the past, but that won't be the case much longer. "More and more of our CEO specs are calling for explicit business experience in emerging markets," Citrin says. Boards are looking for CEOs with passports showing frequent visits to China and India, along with Russia, Brazil, and Dubai. Ambassadors won't just be familiar with these areas, Citrin says, but will have access to local governments, ruling families, and business tycoons.
ARCHETYPE: Citrin points to News Corp. (NWS ) CEO Rupert Murdoch, who has long wooed Beijing officials and launched alliances with local companies. Another example, he says, is PepsiCo CEO Indra K. Nooyi, who was born in Chennai, India.
Citrin believes dealmaking specialists—those able to both sell off noncore assets and go toe-to-toe with private equity players on big acquisitions—will be in heavy demand. Of course, buying and selling has always been part of a CEO's brief, but "increasingly, these large strategic transactions are really bet-the-company kind of deals," he says.
ARCHETYPE: Retired AT&T (T ) CEO Edward E. Whitacre Jr., who turned SBC Communications (T ), once the smallest of the regional Bells, into a powerhouse with a market value of $242 billion. Says Citrin: "He's built the largest player in [his] field from an unlikely starting position."
Corporations' walls are only going to get more permeable, as companies form alliances with outsiders and turn to networks of innovators for ideas to put into practice. Meanwhile, the need for collaboration among corporate units will expand, since demand for new growth areas requires more creativity across divisions. Orchestra conductors will be skilled in getting everyone to play in the same key.
ARCHETYPE: A.G. Lafley, who says half of all new Procter & Gamble (PG ) products should come from outside its R&D labs. Citrin also cites Lafley's integration of P&G's $57 billion purchase of Gillette as proof of his talent as a maestro.
THE CASTING AGENT
If you think "people are our greatest asset" is an overused bromide today, just wait. The talent war is only expected to worsen as boomers begin retiring en masse and emerging-markets managers remain scarce. CEOs who can retain the best people and deploy them adeptly will be hot commodities.
ARCHETYPE: Xerox (XRX ) CEO Anne M. Mulcahy, who named operating chief and heir apparent Ursula M. Burns to the president's role in April. Says Citrin: "She's been able to put the right people in the right jobs to spectacular effect."
By Jena McGregor