How do Co-CEOs work together?

Apr 26, 2013 | China Business News

This article discusses the phenomenon of co-CEOs: one example is that of Samsung appointing three CEOs this past March. David Nagy, Managing Director, China at global headhunter DHR, said ‘To make a co-CEOs structure workable, it is important for executives of the management team to generate synergistic effects, to integrate into one team, and to deliver consistent messages. Considering the fact that every executive makes decisions based on his own expertise and experiences, it would be ideal to integrate them without internal friction.’

Henry Sheng from Hay Group also pointed out that the co-CEO structure may be necessary when some companies have developed to a certain stage. A co-decision structure would make the process more efficient, especially when decisions need to be made quickly in complex situations.

In terms of whether members of the co-CEO structure should take different responsibilities or work together, David believes that the co-CEO structure was more likely to work under two circumstances. One would be that the company is quite big. Co-CEOs could be in charge of different business sectors or regions to achieve more efficient management. The other would be that the co-CEOs had complementary expertise as well as experience, and responsibilities were assigned to different members. If it were a software company, one CEO would be responsible for technology while the other would be in charge of sales.

This was exactly what Samsung did - three CEOs focused on different business sectors. The co-CEO structure in the toy company Mattel also worked this way. The two CEOs were in charge of two core functions respectively, which were marketing and sales. And they took responsibilities together in traditional areas such as encouraging employees to reach business objectives.

When discussing the non-performance of the co-CEO structure, such as what happened at Blackberry, David pointed out that the possible negative effects of the co-CEO structure included the following: unclear strategies if the co-CEOs held different views, and non-cooperation between the co-CEOs could lead to non-cooperation among directors or managers who were with different camps.

Henry Sheng also highlighted the importance of co-CEOs holding the same vision and delivering the same message, and he thought it was too idealistic to expect two persons to have the same predictions for the future.

Hay Group’s research suggested that it would take six to nine months for co-CEOs to have mutual appreciation and provide support to each other. In addition, in order to maximize the strategic advantages of the co-CEOs structure, Henry believed that the co-CEOs’ concepts of team, company structure and the supportive environment were of vital importance.

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