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How do CEOs think?

Guest post by: Dhawal Shah

Article Overview: I travel regularly to meet our customers. Normally, we work with the VP Engineering and the CTO of product Companies. I meet them regularly and most of the time our meetings are technical discussions or discussions about specific projects we may be working on. As the market was slow, most of our customers were not in a position to discuss specific projects. Most projects were on hold, and our customers were under pressure from their CEOs and Boards to reduce costs. This meant that they were pushing us for rate discounts.

How do CEOs think?



As our customers were pushing us for rate discounts, we used the opportunity to get our contact points to get us meetings with their CEO in exchange. Systematically, since January 2009, Hari and I have met more than a 150 CEOs and heads of business. During these meetings were able to observe how CEOs think. This was the best thing that happened to me. I quickly realized that the CEOs have a very different approach to their business as compared to the VP Engineering and the CTO.

Our customers are of all sizes from Billion Dollar companies to start-ups. The CEO and heads of businesses we met corresponded well to our customer mix. By and large, CEO behavior is independent of the size of the Company we met.

Let me share with you the highlights of what we observed from our meetings. There are many corollaries from these basic observations which I will subsequently share with you.

1. CEOs like to focus on a few important items. CEOs are very concerned about their own bandwidth and want to focus on a few important items and leave the rest to someone else to handle. For items that are top-priority, the CEO is deeply involved and wants to track the initiative in detail and at a fine level of granularity. For all other items, the CEO would much rather have someone else take complete responsibility of the task and wants to know only about exceptions.

We observed that management bandwidth of the senior management in the organization is a very big concern for the CEOs. They are keen to conserve management bandwidth and want to ensure that adequate management bandwidth is being devoted to important tasks and is not being spent on the not so important activities.

2. CEOs want to focus on growth of the Company. Universally, we observed that growth is the most important item for all CEO. They are far more focused on the top-line of the Company and not as focused on costs cutting and efficiency improvements. We realized that outsourcing and offshore development when positioned as a cost efficiency exercise is not exciting for the CEO. Those are items for the CFO or the VP Engineering. We observed that we could get the CEOs attention when we had proposals that could provide boost revenues and growth for our customers rather than provide just cost efficiency benefits. We also observed that most CEOs are market focused rather than being focused on internal efficiency. CEOs want to spend more time in the market to understand market trends as that would help them develop sharper insights for future planning.

I quickly realized that to get the CEO’s attention, it is important to offer the CEO some suggestions on growth of his Company rather than just cost benefits.

3. CEOs are interested in solving the ‘entire’ problem for their customer. We observed that when CEOs sell, they are selling a relationship rather than a transaction. They want to interact with their contemporaries – CEOs and other C-level executives of the customer and are keen to understand the challenges faced by the customer. They want to provide a complete solution to their customers. In many cases, and especially when they do not have a complete solution for their customer, they are open to working with other partners to solve their customer’s problem. They realize that if their customer views them as a true partner, a partner who can “solve” their problem, business will eventually happen.

In contrast, most sales executives are focused on completing a transaction. They are completely focused on “the sale.” In the process they are very keen to sell their own products sometimes at the expense of being concerned about solving the customer’s problem. Sales incentives play a role on how sales executives approach the sale.

It was very clear from our meetings that to get sustained interest from the CEO, we must focus on finding ways to solve their problems. Instead of focusing on pre-prepared service offerings, it helps to be creative in thinking of ways to address the customer’s problem. In several cases we realized that we did not have service offerings that solve customer’s problem. In such situations, stepping back and referring someone else who may be better suited to help the customer solve their problem was much appreciated by the CEO. Even though, we may miss out on the transaction, I am sure it will help us get business from them in the long-term.

I have been reflecting on these observations and have realized a few corollaries on how to engage with CEOs. I have also been reflecting on my behaviour … do I behave like a CEO? Will write more on this subject.

Dr. Anand Deshpande, Founder, Chairman & Managing Director, Persistent Systems Anand is an alumnus of IIT, Kharagpur (India) and has completed his graduation in Computer Science Engineering, followed by a PhD from the Indiana University (USA). He began his career with a stint at Hewlett Packard (USA) and later returned to India in 1990 and founded Persistent Systems.

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Article Tags: adequate management, bandwidth, billion dollar companies, br 2, ceo, ceos, corollaries, efficiency improvements, exceptions, granularity, initiative, rate discounts, senior management, top priority, ups, vp engineering

About the Author: Dhawal Shah RSS for Dhawal's articles - Visit Dhawal's website Dhawal Shah has now launched his franchise brand, www.FranchiseExpo.in, www.ArabianFranchise.com and www.FranchiseSG.com which is an internet resource for Indian Franchising Industry. He previously worked with the the Franchising Association of India for over five years. He is a qualified franchise professional with Certified Franchise Executive degree from the International Franchise Association, a well known and an international speaker for Indian Franchising, his sites have generated over 25000+ Leads and have helped thousands of entrepreneurs decide the most ideal of all businesses. To know more Dhawal Shah may be reached at Dhawal.Shah@way2franchise.com Click here to visit Dhawal's website More from Dhawal Shah Vaidyaratnam eyes to have more franchisees Delhi Based Home Furnishing Franchise Maishaa aims to expand retail presence with 25 franchise stores Comparing Franchising and Network Marketing Monginis plans 50 outlets panIndia by 2010end seeks franchisees Le Sutra Hospitality mulls franchise expansion

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