Successful Innovation and CEO

The role of a CEO in a new startup is filled with challenges.  The new CEO must be willing to learn from his mistakes and from others.  Eric Ries writes, “startup success is not a consequence of good genes or being in the right place at the right time.  Startup success can be engineered by following the right process, which means it can be learned, which means it can be taught.”[1]

The startup CEO must be a risk-taker as well.  The critical element of risk-taking process is exploration into the unknown.  According to Greg Gehrich, “a CEO who fosters a culture of risk and rewards will out-innovate the competition, and a CEO who supports agile product development methods for the entire business will grow a lean and innovative organization.”[2]  Successful CEOs are usually successful innovators.  According to Gehrich, best practices for successful innovation can be summed up in four points:[3]

1.     An innovation strategy counts

2.     Focusing on high-risk but higher-return innovations matters

3.     Innovation leadership is central to success

4.     The CEO must be the innovation leader

The CEO must encourage and empower an innovative culture across the company.  “Innovation, regardless of how small or seemingly insignificant, is already occurring in the organization,” writes Dr. Oster.  He adds, “The invisible innovators already have determined how to recast imposing corporate problems into small, tangible and quickly solvable opportunities.”[4]  Recognizing and rewarding invisible innovators could be a crucial undertaking in securing the success of a startup.

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[1] Eric Ries, The Lean Startup:  How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses, Random House Digital, Inc., 2011, 3.

[2] Greg Gehrich, Build It Like a Startup: Lean Product Innovation, California: Greg Gehrich, 2012, 91.

[3] Ibid, 91-92.

[4] Gary Oster, Emergent Innovation:  A New Strategic Paradigm, Journal of Strategic Leadership, Vol. 2, Iss. 1, 2009, pp.40-56

CEO Cartoon

The Role of CEO - A Brief Look

CEO is responsible for developing a long-term strategy for leading the company and creating shareholder value.   The CEO must have the management skill to hire, organize and staff the company.   Financial assessment in accordance to authorized annual budget of the company is a crucial aspect of CEO’s responsibility.  As such, internal and external risk assessment, implementation of internal controls, and adherence to the company’s standards and policies are parts of CEO’s activities.  According to Carver, “the job of the CEO is to work whatever magic it takes to ensure an acceptable amount, type, and targeting of benefits in prudent and ethical ways.”[1]

CEO is a liaison between management and the board, and is tasked with maintaining effective communication with shareholders, employees and the public.[2]  Therefore, the CEO will have to lead by example and encourage all employees to conduct themselves in accordance to the company’s standards and policies and also with all applicable laws. 

A CEO should be an innovation leader.  Dr. Oster writes, “The position of innovation leaders is complex, difficult, frustrating, politically dangerous, and often virtually thankless.”[3]  As such, a CEO must be courageous, creative and relentless. 

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[1] John Carver, Boards That Make a Difference: A New Design for Leadership in Nonprofit and Public Organizations, John Wiley  & Sons, 2011.

[2] Michael J. Worth, Nonprofit Management, California: SAGE, 2011, 87.

[3] Gary Oster, Leading Corporate Innovation, School of Global Leadership and Entrepreneurships at Regent University, August 2007, 16.