Here is an excerpt from an article written by Michael E. Porter and Nitin Nohria for Harvard Business Review and the HBR Blog Network. To read the complete article, check out the wealth of free resources, obtain subscription information, and receive HBR email alerts, please click here.
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In the lexicon of management, the CEO is the epitome of leadership. Yet surprisingly little is known about this unique role. While CEOs are the ultimate power in their companies, they face challenges and constraints that few others recognize.
Running a large global company is an exceedingly complex job. The scope of the organization’s managerial work is vast, encompassing functional agendas, business unit agendas, multiple organizational levels, and myriad external issues. It also involves a wide array of constituencies—shareholders, customers, employees, the board, the media, government, community organizations, and more. Unlike any other executive, the CEO has to engage with them all. On top of that, the CEO must be the internal and external face of the organization through good times and bad.CEOs, of course, have a great deal of help and resources at their disposal. However, they, more than anyone else in the organization, confront an acute scarcity of one resource. That resource is time. There is never enough time to do everything that a CEO is responsible for. Despite this, CEOs remain accountable for all the work of their organizations.
The way CEOs allocate their time and their presence—where they choose to personally participate—is crucial, not only to their own effectiveness but also to the performance of their companies. Where and how CEOs are involved determines what gets done and signals priorities for others. It also affects their legitimacy. A CEO who doesn’t spend enough time with colleagues will seem insular and out of touch, whereas one who spends too much time in direct decision making will risk being seen as a micromanager and erode employees’ initiative. A CEO’s schedule (indeed, any leader’s schedule), then, is a manifestation of how the leader leads and sends powerful messages to the rest of the organization.
A crucial missing link in understanding the time allocation of CEOs—and making it more effective—has been systematic data on what they actually do. Research on that has tended either to cover a small handful of CEOs, like the 1973 study in which Henry Mintzberg closely observed five chief executives (some of whom led nonprofits) for five days each, or to rely on large surveys that cover short periods (such as our HBS colleague Raffaella Sadun’s 2017 study based on daily phone surveys with 1,114 CEOs from a wide variety of companies in six countries over one week).
Our study, which we launched in 2006, offers the first comprehensive and detailed examination of CEO time use in large, complex companies over an extended period. To date, we have tracked the time allocation of 27 CEOs—two women and 25 men—for a full quarter (three months) each. Their companies, which are primarily public, had an average annual revenue of $13.1 billion during the study period. These leaders were all participants in the New CEO Workshop, an intensive program that every year brings newly appointed CEOs of large companies to Harvard Business School in two cohorts of 10 to 12 each. In total just over 300 CEOs have attended it.
In the study each CEO’s executive assistant (EA) was trained to code the CEO’s time in 15-minute increments, 24 hours a day and seven days a week, and to regularly verify that coding with the CEO. The resulting data set reveals where, how, and with whom the CEO spent his or her time and on what activities, topics, and tasks. Because it also covers what CEOs do outside of work, we have visibility into how CEOs balance work and personal life. In all, we collected and coded data on nearly 60,000 CEO hours.
Where and how CEOs are involved determines what gets done. It signals priorities.
After CEOs completed the time-tracking phase, we shared their data with them, comparing it with anonymized data of the other CEOs we had studied up to that point. These intensive debriefings often included the CEOs’ reflections on the pressures they faced in managing time, and on their mistakes and lessons learned. We also shared our accumulated data with the participants in each New CEO Workshop. In our discussions, CEOs routinely described managing time as one of their greatest challenges. The observations, questions, and personal approaches to allocating time they shared further enriched our understanding.
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Michael E. Porter is a University Professor at Harvard, based at Harvard Business School in Boston.
Nitin Nohria is dean of Harvard Business School.