People often think the CEO holds the ultimate power, that every key decision is made solely by him.
This naive belief usually comes from those who have never been a CEO or worked closely with one.
It’s essential to understand the decision-making process. Whether it’s spontaneous or structured, what really matters is the asymmetry between the manager and the CEO.
Simply put: the manager has an abundance of detailed information about the project, but lacks authority. The CEO, on the other hand, has more than enough authority but only a general understanding of what’s happening on the ground.
This is why the CEO asks the manager to prepare a "draft decision," even if they don’t call it that. A bad manager pushes for a single option; a good one offers an analysis of three.
Thus, the manager shapes the context in which the CEO makes decisions.
The CEO may act like a tyrant, and the manager may bow down, but that doesn’t matter.. The decision is already predetermined, like at a gas station refrigerator—there may be different flavors, but it’s all the same brand.
When making decisions, the critical question is, "How should I think about this?" An experienced CEO understands the inevitability of this dynamic. That’s why he:
Clearly outlines the decision-making process, breaking it down into stages.
Appoints conscientious managers whose goals align with his own.
Invites advisors or a board for an alternative point of view.
Sincerely yours,
-Alexander
About me:
As a business therapist, I help tech founders quickly solve dilemmas at the intersection of business and personality, and boost company value as a result.
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