Delivering growth requires leaders to take a hard look at the structure of the C-suite and how it operates.
The market demands that large companies innovate differently, embrace digital, create ecosystems and transform customer relationships at a breath-taking pace. Succeed, and the rewards may be exponential; fail, and irrelevance quickly follows. With disruption raising the stakes, shouldn’t the C-suite be optimally structured to rise to the challenge?
Yet our research shows most CEOs, board directors and institutional investors from the world’s largest companies and institutions believe that the current C-suite model fails the test.
In this final article of our CEO Imperative series, we find fixing that requires more than merely adding more roles with a “C” in the title. Companies must actively address how leadership teams operate by examining fundamental issues of hierarchy, agility and the elimination of organizational silos.
“The heat is on CEOs and their C-level teams,” notes Gil Forer, EY Global Markets Digital and Business Disruption Lead Partner, and EYQ leader. “The list of imperatives — from digital, to customer, to global challenges — does not diminish, and responding successfully will require C-suites to realize the new landscape of business imperatives and the needed capabilities to successfully compete in the 21st century.”
C-suite model not suited to the demands of the next decade
Today’s C-suite model is a legacy of the post-War period, a vastly different time. In 1964, the average tenure of a company on the S&P 500 was 33 years; today, it is 22 years and headed to 12 years by 2027. It’s no wonder then, then, that two-thirds of our study participants conclude that the legacy C-suite model is not well-suited to the imperatives of the next decade.