Let's take two hypothetical situations, assuming that the CEO has a 40-hour work week, takes four weeks of vacation per year, two weeks off for training, education and due diligence work, and 10 holidays. That's the equivalent of 44 weeks, or 220 workdays per year. The following are two examples of the time offices of different sizes might spend on business planning and implementation. The math offers insight about the actual time required to be CEO.
If a solo organization with one advisor and two support staff members (see Figure 1) has $500,000 in recurring annual revenue, the advisor could spend one to two days per year on a session to create next year's business plan. The firm could offer a quarterly session to review, revise and share the plan status. This session could last half a day per quarter or two days a year. Meanwhile, a monthly review of annual goals could take two hours per month and three days a year. And a weekly reading of the business plan could take 15 minutes, or two days per year.
Added up, these are eight to nine days per year, or 4% of the advisor's time annually.
In Figure 2, an ensemble organization has one advisor CEO, five additional advisors and five members of the support staff. The firm has $3.5 million in recurring annual revenue.
Here, an annual session to create next year's business plan would take two to three days per year. The quarterly session
to review and revise the plan status could take one day per quarter, or four days a year. The monthly review of annual goals can take four hours per month or six days per year. And a weekly read of the business plan could take 20 minutes, or two days per year.
In this case, that's 14 to 15 days per year, or 6% to 7% of the advisor CEO's time.
Not as much as one would have guessed, correct? Moreover, even though the business plan is not a CEO's only responsibility, it is an activity with a high return on investment for the time spent.
Being Serious About Leadership
A firm that takes the CEO role seriously will consider a formal performance review for the person wearing the hat. Imagine, for example, that the CEO received a performance review every six months-like any other employee of the firm. This would allow the firm to ask if the CEO did the following things:
Created a written business plan document;
Kept the plan top of mind in daily interactions;
Regularly assessed company performance goals defined in the business plan;
Shared the firm's results with others, so that there would be a firmwide vested interest; and
Harnessed the enthusiasm of the entire organization.
More simply, did the CEO create a business plan and then use it weekly, monthly and quarterly to drive the organization?
If you are the CEO, and if you rated your own performance on each question on a scale of 1 to 5, with 5 highest, how would you rate yourself? Would you exceed, meet or fall short of expectations? How would your assessment match the assessment of others in your firm?