Path to Ultimate Career Success: What Makes a CEO?
A newsletter from Aura Workforce Analytics
We at Aura decided to look at a randomized selection of 30 CEOs from large companies (employing over 10,000 employees) from different sectors and countries, aiming to shed light on the varied paths that lead to the top of the corporate ladder. By looking at the journey of the CEOs, ranging from technology innovators to the leaders in traditional industries, from several lenses, such as gender, geographical distribution, educational background and career tenure, we can explore broader trends in leadership within sizable organizations.
With a closer look into their profiles, we aim to unravel the mix of experiences and qualifications that shape the leaders of today's largest companies, offering insights (and maybe even serving as inspiration?) into the evolving landscape of global corporate leadership.
Selection background: Gender Distribution:
In our randomized selection of 30 companies, the gender distribution stands at 5 female and 25 male CEOs. This ratio mirrors a broader trend in the corporate world where male leaders predominantly occupy the top echelons of large organizations. The presence of female CEOs among this group, albeit smaller, contributes to the ongoing conversation about gender representation in corporate leadership roles.
Selection background: Geographical Distribution:
The geographical footprint showcases a significant leaning towards the United States, with 19 of the 30 based there. This is followed by the United Kingdom and Germany, each hosting 3 CEOs. The list completes with one CEO each from Canada, France, India, Sweden, and Switzerland. The distribution highlights the United States as a central hub for corporate headquarters, while also acknowledging the global spread of leadership originating from various parts of the world.
Selection background: Sector Overview:
The sectors represented by these CEOs range widely, with Technology leading the count at 10 CEOs, indicative of the sector's overarching influence in the current global economy. Following Technology, Advanced Manufacturing & Services have 5 CEOs, and Healthcare is represented by 4. Retail & Consumer Goods, Energy, Resources & Utilities, Entertainment & Media, and Finance & Investment sectors contribute 3, 2, 2, and 2 CEOs respectively. Notably, Professional Services and Education each are represented by a single CEO, rounding off the diverse array of industries included in analysis, overall showcasing a broad spectrum of the economy, from traditional industries to emerging fields.
So what is common among these CEOs?
CEOs’ profiles closer look: Educational Pathways
The educational backgrounds of the 30 CEOs reveal a diverse array of highest education levels achieved, ranging from MBAs to having no official degree – this variety shows that there is no “winning formula”, and the path to leadership varies in each individual case.
The prevalence of MBAs among these CEOs (9 out of 30) highlights the continued value placed on the comprehensive business education and strategic thinking skills that MBA programs aim to instill. This finding aligns with the traditional view that an MBA is a stepping stone to high-level executive roles, offering both a broad understanding of business operations and a network that can be crucial for career advancement.
Close behind, Master's degrees (8 CEOs) suggest a significant appreciation for specialized knowledge alongside leadership capabilities. This trend may reflect the increasing complexity of the global business environment, where in-depth expertise in specific areas, such as technology or engineering, can be as crucial as broad managerial skills.
The CEOs with only undergraduate education (6 CEOs) underscore the potential for exceptional leadership and business acumen without the advanced degrees traditionally associated with corporate leadership. Their success suggests that experience, skill, and perhaps an entrepreneurial spirit can rival the formal education credentials in the path to becoming a CEO.
The presence of PhDs among analyzed profiles (5 CEOs), particularly in sectors like technology and healthcare, indicates the growing importance of deep, technical expertise and research capabilities at the highest levels of company leadership. This may reflect the increasing role of innovation and technical advancement in driving company success in certain industries.
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The single CEO without a formal degree serves as a powerful reminder that unconventional paths can also lead to significant leadership roles. This exception highlights the value of experience, innate leadership qualities, and perhaps entrepreneurial achievements over formal education in certain cases.
CEOs’ profiles closer look: Path to Leadership
The journey to the CEO position, as well as the duration spent in this role, provides insights into the career dynamics of high-level executives. Analyzing the average career tenure before becoming CEO and the average tenure as CEO in their current company among our group of 30 leaders reveals significant trends about leadership progression and tenure in large organizations.
The average career tenure of approximately 31 years underscores a necessity for professional growth and the accumulation of strategic, operational, and leadership skills. This extensive career duration suggests that experience and a broad understanding of business dynamics are highly valued in leaders of large organizations.
With an average CEO tenure of 5.5 years, there's an indication of the challenging nature of maintaining leadership at the top, reflecting the intense pressures, high stakes, and the rapidly changing business environment that CEOs must navigate. This duration also points to the cycles of leadership renewal that large organizations undergo, allowing for fresh perspectives and adaptation to evolving market conditions and corporate strategies. It may reflect both the personal choice of leaders to seek new challenges after leading an organization, as well as corporate governance, establishing periodic leadership change to ensure company innovation and adaptability.
It is notable to highlight that 19 of the 30 CEOs have been working at the same company in a different role (often serving heading Operations, Finance or Marketing/ Product), before stepping up to take the highest-level Executive position. This may signal that knowledge of the company from within (from the perspective of operations, leadership, and industry) gives a benefit to be elected as CEO.
On the other hand, 11 CEOs were elected from outside – either from competitors within the same industry, as well as from another sector/ professional background. It can be concluded that having the experience, necessary management and leadership skills is valuable in itself to obtain the CEO position.
The insights gleaned from the average career and CEO tenures offer valuable considerations for aspiring leaders and organizations alike, highlighting the importance of continuous learning, resilience, and the readiness to embrace change as integral components of successful leadership in today’s fast-paced business world.
Conclusion
As we explored a selection of 30 CEOs from large companies, with a rich diversity in leadership, spanning various sectors, educational backgrounds, and career trajectories, we can conclude with the following:
And although the question of “What makes a CEO?” is very wide and can be tackled from multiple angles, it is clear that adaptability, resilience, and diverse experiences are important in shaping effective leaders. As the business landscape continues to evolve, these insights serve as a guide for future leaders and organizations alike, emphasizing the need for inclusive, innovative, and strategic leadership that can navigate the complexities of the global market.
At Aura, we support this type of analysis by making workforce data readily available, enabling comparison of relevant metrics between cohorts of companies and candidates to develop a deeper understanding of workforce trends and drive meaningful change.
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Abylay Jetmekov
Product Manager, Aura