CEOs Should Get Out More

CEOs are out of touch with key success factors.

A Globe and Mail article this week by Tavia Grant suggested that CEOs are ?still in the dark’. (Hat tip to Rick Spence for mentioning this.) These comments were triggered by a global survey from Deloitte Touche. They reported that executives are out of touch with the health of their companies because they lack detailed information about the non-financial side of their business. Business performance and financial results would likely improve with a more balanced mix of financial and non-financial objectives.

This is not a new message. The Balanced Scorecard approach has been around for over ten years, as an article from Bain shows. The Balanced Scorecard Institute sets out the principles involved.

The balanced scorecard suggests that we view the organization from four perspectives, and develop metrics, collect data and analyze it relative to each of these perspectives:

* The Learning and Growth Perspective
* The Business Process Perspective
* The Customer Perspective
* The Financial Perspective

It is surprising how often the customer perspective gets overlooked. So many companies are product-oriented rather than customer-centric. Customer service is often a punch-bag to absorb the customers’ frustrations, rather than a channel for dialogue with customers. However the Internet is putting customers in control and a company that disregards their inputs will be overtaken by their competitors. Any CEO who is in the dark about that is falling down on one of the most important parts of his responsibility.

Related: Telecom CE0s Do Not Get Web 2.0

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