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Are You the Best CEO You Can Be?

Understanding the vital role of the CEO and business systems

Last week, I talked about the importance of systems to the success of a business. In that post I wrote:

A business is a complex system of interoperating systems. And like a body, if one of those systems fails, the whole business will either be crippled or die. The B-I Triangle visually represents many of these systems. They are all separate but also all linked together. It is difficult to separate the systems because they are interdependent, and it is also difficult to say that one is more important than the other.

Just as important to the success of a company as the systems it employs, is the leader that makes sure those systems run at peak performance—and that the right systems are in place. I’m speaking of the company’s CEO.

A CEO’s main job

A CEO’s job is to supervise all systems and identify weaknesses before they turn into system failures. These failures can happen in many different ways, but they are exceptionally disconcerting when your company is growing rapidly.

Many CEO’s find it surprising that when everything is finally going right—their sales are increasing, their product or service is getting the attention it deserves from the media, and things are growing fast—they suddenly can’t deliver. Why?

Why systems fail

Usually, it is because systems have failed from the increased demand. For instance, you don’t have enough production capacity or the extra money needed to improve the product or hire additional help.

Whatever the reason, opportunities are missed to move the business to the next level of success, all due to a failure in systems.

Building ahead of the curve

At each new level of growth, the CEO must start planning the systems needed to support the next level of growth, from production lines to lines of credit for production needs. Systems drive both cash-flow management and communication. As your systems get better, you or your employees will have to exert less and less effort. Without well-designed and successful operating systems, your business will be labor-intensive, and will stall at one or more growth phases.

This is important because if you’re looking to sell your company or go public, you must have stable, scalable systems in place. Investors are looking to buy a business, not hype. Personality and charisma can only take a business so far.

Work on, not in, the business

If you want to be a successful businessperson, you must learn how to be a successful CEO. That starts with understanding that your #1 job is to work on the business, not in it. That means you must become a master of systems, managing them and knowing when to implement new ones.

As I stated last week, the best way to gain this kind of expertise is through experience. Do it, and you’ll get better at it. Sure, you’ll fail along the way, but the lessons you’ll learn will make you that much better down the road.

And while you’re at it, read rich dad advisor Garrett Sutton’s books, Start Your Own Corporation and Run Your Own Corporation. Also, take a few moments to sign up for the free Rich Dad Community, where you’ll find a wealth of valuable resources.

Original publish date: April 14, 2015

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