What a CEO Does

I’ve thought long and hard about the proper role for a CEO. At Junction Networks specifically, the main focus of that role has changed over the years, but I like how Fred Wilson puts it at the AVC.com blog:

“A CEO does only three things. Sets the overall vision and strategy of the company and communicates it to all stakeholders. Recruits, hires, and retains the very best talent for the company. Makes sure there is always enough cash in the bank.”

This keeps it simple and puts everything nicely into perspective. We’re lucky at Junction Networks to have three founders, each charged with collectively setting the vision for the company.

I’d like to focus on the first of the three parts: setting the overall vision and communicating that vision to stakeholders. In that aspect, being the CEO of a technology company is no different from being the CEO of almost any company. Namely, you have to know your industry, know your business, strategically set the vision for the company, and then communicate that vision to all.

Too many times, however, I’ve seen technology CEOs who expect too much from technology, especially software. This is problematic in many ways. To set the vision for the company, you have to know what you can and can’t do. Imagine an auto manufacturer CEO wanting to produce a compact and a SUV from the same chassis. (Hey, they’re both cars. What’s the problem?)

Software is particularly tricky because you tend to get the feeling that you can do anything with software. While it’s true the possibilities are endless, the possibilities can also be extremely time consuming. Some features are quick and easy to do if you have the right tools and the right platform, and other features require an entire re-write of the system.

It’s also important to have a clear vision: Set it and stick to it. By keeping the vision consistent, the developers can create the system knowing where you are today and where you’re looking to go in the future. If you did a good job setting and communicating a consistent vision for the company, then your team can, in turn, confidently create the platform and resources necessary to carry the product into the future.

An indistinct vision is just as bad as a concrete vision that changes often. The result is that no one can keep track of where you’re going. An indistinct vision makes developers hesitant to commit to any specific direction, and they spend forever in R&D trying to find the perfect platform, which does not exist, that will allow them to develop the product - whatever it may be. If the vision is constantly shifting, developers are constantly changing platforms and tools with the changing tides wasting time and pushing back product launches with each change.

Just like a auto manufacturing CEO really should know something about actually making the cars, a technology CEO really should know something about the software, hardware, or a combination of the two. If you can’t explain how your system works to your engineering team without a room of rolling eyes, it’s time to start doing your homework.

In closing, thanks Fred. Sometimes we get overwhelmed trying to see the forest for the trees; and, it’s nice to be reminded what the big picture is. Set a good vision. Watch the money. Hire good people, and if you’re a technology CEO, please, keep up with the technology.