Time: The CEO’s most precious resource

In Ben Horowitz’s influential article on Peacetime CEO/Wartime CEO, he quoted a very memorable line from Andy Grove, the legendary Intel CEO, who chastised a subordinate who came late for a meeting: “All I have in this world is time, and you are wasting my time.” Time is the CEO’s single most important and yet most easily wasted resource.

Indeed, even though the CEO is the head of the whole organization and is mostly free to delegate or re-allocate resources at will, he really has very little room to maneuver when the resource constraints, goals and myriad demands of the market are taken into account. This is even more prominent in a software technology company’s growth stage, the unique period when the company takes its proven product and economic model to scale. The operational challenges associated with the transformation can be overwhelming because they permeate all aspects of the organization: people and team development, corporate governance, financial management, continued product innovation and, most importantly, sales and marketing optimization.

 

The result is that the only resource that the CEO has full and almost complete control over is his/her own time. It is extremely precious, in part, because it is so scarce and is the least scalable of all resources. That’s true not only for the CEO, but for the whole organization and, by extension, its investors, customers, and partners.

The CEO’s limited time is absorbed by everything from:

• Internal meetings with other executives for product and market strategy planning
• Building and developing the management team
• Rallying the rank and file employees
• Quarterly meetings
• Meeting with customers and prospects
• Negotiating with partners
• Presenting the company’s vision in the markets
• Raising funds for growth and operations
• Exploring strategic with potential acquirers and acquisition targets

There is clearly not enough time in anyone’s world to make all of those things happen, yet we typically expect CEOs to lead and accomplish them all.

 

 

So, while it might sound preposterous, as an employee, a stakeholder, a customer or a partner you should be asking, “Mr. CEO, what are you doing with your time, our most precious resource?” That question is not meant to challenge the CEO nor be directive to what the CEO knows best about, but rather it is a rhetorical inquiry. It’s important for everyone to understand the CEO’s time and how it is spent, employing the same overall resource focus and optimization challenge that the organization needs to solve to grow and prosper.

There is no prescriptive model for how the CEO should maximize his or her time, because each company has a unique set of challenges and opportunities that calls for a unique combination of activities. Horowitz’s thoughts on Wartime vs. Peacetime CEO draws a good contrast for the CEO’s focus in the comfortable “peacetime” and the growing “wartime” periods.

A.G. Lafley’s classic article for the Harvard Business Review titled “What only the CEO can do?” highlights the activities that the enterprise CEO can ill afford to delegate or ignore, namely connecting the inside and the outside via the four key activities:

1. Defining the most important outside constituency
2. Deciding the business the organization is in
3. Balancing the present and the future
4. Shaping values and standards

What does of all this mean for an effective CEO’s day-to-day schedule? Are meetings with the team more important than meetings with prospective customers? And when should the CEO be inward looking, focused on developing the organization or its future products, as opposed to bringing the vision to the market?

 

A recent article on the Wall Street Journal titled “Where is the Boss? Trapped in meetings” cites the “Executive Time Use Project,” where professors at HBS and the London School of Economics studied the daily schedules of CEOs to a minute level of detail. The study found that most CEOs are spending one third of their time – about 18 hours per week – in meetings, while only spending about about six hours working alone. Much time is also spent traveling (no doubt to some of the meetings) and on telephone calls and conference calls (another form of meeting). It is not surprising that CEOs all recognize the mismatch and almost universally “pine for more solo time to think and strategize.” But they also find it difficult to break out of the typical mold and its expectations.

A related study of CEOs’ meetings found that external meetings are not correlated with better performance, while internal meetings are.The same article also quotes CEOs who appear to have more control of their time, noting that they either spend less time in meetings, a lot of time working alone, or delegate time in short, iterative “touchpoints” rather than formal meetings. The research insights and the anecdotal evidence points to the importance of time management for CEOs and hopefully provides some ideas for CEOs who want to strike a better time balance. Doing that would allow them to better steer and support the organization’s growth and success.