Business

What keeps business executives up at night?

The turn of the new year always brings both reflections and considerations for the future. “What’s going to happen this year?” is one of the major questions on the minds of most business executives and organizational leaders. Charged with the responsibilities of providing the strategic focus that leads to growth and profits, these men and women must be prepared for the unpredictable and unexpected. That’s worrisome on the face of it.

Sitting at dinner in a restaurant in downtown Pittsburgh recently, I overheard a conversation between two business executives, one a CEO.

“What keeps you up at night?” the one asked. The CEO responded: “With all that I have to do every day, I usually get a good night’s sleep. But strategic business issues do give me cause for concern, especially at the start of the year.”

What are the plans for action on the minds of CEOs and senior executives for 2008? In an election year, with fuel costs rising, a likely credit crunch, and the whisper of recession in the air, it’s understandable that business leaders from all organizations face similar concerns. Add to these larger issues, most of which are — more or less — out of an individual or single organization’s control — fears of data loss or theft, environmental worries, internet rumors, new technologies, product portfolios and so many other day-to-day things, and its easy to see how someone could lose sleep.

Numerous studies are done annually to detect CEOs’ level of confidence and concern entering a new year. According to the results of the most recent CEO Challenge Survey by the Conference Board, execution is taking precedence over profit and top-line growth as a focus for CEOs around the world. Excellence in execution — a new challenge to the survey — and consistent execution of strategy by top management rank first and third, respectively, as greatest concerns. This year’s survey also has a special section focusing on challenges to innovation, and respondents rate acquiring/developing the right talent as their number one innovation challenge.

The major theme that continues to arise from the responses of senior level executives to numerous surveys is: Having the right people, in the right place, at the right time, and with the right skills. Talent acquisition and management continues as the toughest ongoing challenge to business success.

Matt Schuyler, chief human resources officer for McLean, Va.-based Capital One, said, “It is becoming really challenging in the war for talent to retain that talent. People want diverse experiences and constant learning to take place. We must keep pace, actually be ahead of the curve, and make sure our people are feeling adequately challenged and rewarded. And this is a time of turmoil for financial services.”

Bill Schreiber, vice president and general manager of Land O’Lakes in California agrees that “people make all the difference in the world on who wins and who loses.” It is people who ensure that his company does not succumb to the kinds of problems that put food companies out of business. “What keeps me up at night is worrying about safeguarding the integrity and wholesomeness of our branded products. Food safety, in general, is foremost on my mind.”

Jim Clifton, chairman and CEO of the Gallup Organization said that “running a company today is like running a professional sport team. You just can’t win unless you have both superstars and a spirited team to back them up. Stars create energy where none existed and win when they’re not supposed to. The new phenomenon of ‘engagement’ — acting in the best interests of the organization — is a real factor. The national average for engagement is only 25 percent. You have to have 50 percent or your work force truly committed or you will not grow organically.”

Entering 2008 presents worries, true, but it also offers also wonderful opportunities. How they are recognized and dealt with will be the key to success in the year to come. Join me on my Blog, Thinking Ahead in Business, where the discussion will continue or contact me at pac21@psu.edu.

Patrick Cataldo is associate dean for executive education at Penn State’s Smeal College of Business.

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