Text written by Luís Felício - Executive Director of Galeazzi & Associados

CEOs face a myriad of challenges and pressures that can lead to business failure. Here are some of the top priorities, in my opinion, that these executives should pay closer attention to. The success of the business depends on it.

1- Alignment of expectations

Managing the expectations of shareholders, employees, and other stakeholders can be tricky. Shareholders often lack alignment and may not have the same understanding of the company's issues. The same applies to the executive team, which may also be misaligned on problems and priorities.

This is crucial. The chain of command is often unclear, and shareholders may interfere at lower levels. Dual command has never worked. The CEO must clearly communicate their vision and plans to avoid misunderstandings or resistance. It's common for a new CEO to bring in their directorial team even before understanding the company's context and problems. Perhaps this move should be reconsidered.

2- Understanding the context

Understanding the company's culture, processes, challenges, strengths, and weaknesses is crucial. The CEO needs to absorb information quickly to make decisions and avoid hasty changes that could be misinterpreted or harmful. The CEO needs to listen to the organization and not restrict communication to the next level.

3- Pressure for quick results

Often, there is an expectation that a new CEO will bring about significant and rapid changes. However, implementing sustainable and effective changes may require time and patience. This pressure primarily comes from shareholders, and the CEO must know how to handle it.

4- Limited time

Shareholders typically expect short-term results, creating tremendous pressure on the CEO and directors. Creating an achievable plan and getting it approved by shareholders is crucial.

What's the problem? Having to deliver the plan! Changing the plan every two months or neglecting to review it is not the path to success. This is more common than one might think.

5- Valuing return on investment

Shareholders are interested in financial results. A CEO who demonstrates a clear commitment to improving the company's financial performance is generally well-received by shareholders.

For this to happen, the CEO needs an action plan and should not keep changing it every month. The worst-case scenario is having to explain why it didn't work.

6- Lack of depth in problem analysis

Sometimes, managers may settle for a superficial understanding of results without investigating root causes. A more in-depth analysis is needed to fully understand problems and identify appropriate solutions.

Mapping out problems and potential solutions requires the manager to leave their office, visit and understand operations, and talk to key people in the company, not just directors and controllers.

Leading from the rear does not work, even in modern armies. It needs to be visible, at the front line.

7- Identifying priorities

Determining which areas need immediate attention and which strategies can be more effective for long-term growth and stability is a critical challenge.

There is a need to balance solving immediate problems with a long-term vision. What is the company's situation - if it's in survival mode, short-term is paramount. The CEO needs to understand the business "levers" and not disperse attention, not get dragged into less relevant problems.

You can't embrace everything. Choose your battles, stay focused. Pressures will come from all sides, especially from shareholders. Excessive plans, multiple work fronts, lead to nothing. The plan must be clear, with few actions, and assign responsibilities, which must be agreed upon. Accountability, that's the name of the game. Those who agreed to the plan and didn't deliver need to be replaced.

8- Fear of making tough decisions

Making decisions that can imply significant changes in the company, such as cost cuts, restructuring, strategic changes, changes in some executives, can be difficult and even scary for some managers. The fear of making unpopular decisions can lead to inaction. Continuing to do things the same way is a guarantee of failure. It needs to manage conflicts, solve problems effectively.

9- Building relationships

Establishing trust with the existing team, partners, shareholders, and other stakeholders is essential. Without support and cooperation, implementing effective changes can be extremely difficult.

10- Leadership problems

An inappropriate leadership style, such as being overly autocratic or too passive, can lead to problems in corporate culture, employee demotivation, and company paralysis. Everyone is waiting for clear direction with achievable goals. It needs to bring people into its project.

11- Failure in building and managing teams

The improper choice of executive team members, a lack of effective delegation, or an inability to inspire and motivate the team can negatively impact company performance.

If necessary, identify and bring in new leaders for the company. This includes choosing people who align with the CEO's vision and have the necessary skills to drive the company forward.

Fresh blood is always good for business, but it also brings internal resistance from those who expected to fill those positions.

12- Lack of industry experience

If a CEO is new to the industry, it may take some time to become familiar with the specific details and fully understand the challenges the company faces. It's not just a matter of reading financial data; they need to master the "business," understand its specifics.

If this doesn't happen, the likelihood of failure is high. If you're in the fashion industry and know nothing about fashion, it gets complicated. The same applies to retail, agriculture, hospitality, and many other sectors.

13- Attachment to the past

Some managers, as well as shareholders, may be attached to old strategies. They worked in the past but have become obsolete due to changes in the market, technology, or consumer preferences.

Resistance to change can hinder adaptation to new realities. Doing the same thing that has been done doesn't change the outcome!

14- Failure to adapt to the internal environment

Not understanding or adapting to the existing organizational culture or not working effectively with different departments and areas of the company can create obstacles for the CEO.

15- Lack of resources or support

Managers may face constraints on resources, whether financial, human, or technological, making it difficult to implement necessary changes. If you can't resolve this issue, follow the path of adjusting the company; you just can't stand still.

In conclusion, I emphasize: the line between success and failure is very thin. If the expected results are not delivered, the CEO will fall, sooner or later.

No CEO is hired to explain problems at every meeting. Don't look for blame; shareholders are already tired of hearing that. Focus on a handful of actions that will actually bring results, and don't disperse yourself.