Organizing the Chief executives team

The first requirement is that it be a “team” rather than a “committee”. There should be no collective responsibility. Each member should have assigned to him the areas in which he makes final decisions and for which he is responsible. Deliberation should be done jointly but decision must be single.

However it should not be forgotten that there are two ways of organizing a “team” exemplified perhaps best by the baseball team and the tennis doubles team respectively. In the baseball team each player has a fixed position which he does not leave. In playing doubles tennis each player too has an area of responsibility; but he is also expected to cover his partner. Under the first organization the lines are drawn for the team members. Under the second one the partners in collaboration work out the lines of demarcation themselves. The baseball team way has the advantage that total strangers can play well together; but a good opponent can direct his plays into the gaps between positions which no one really covers. To play a winning doubles game in tennis a team has to have played together quite a bit; but the partners have come to know and to trust each other there will be no gaps on their side of the net. The one team, in other words, depends entirely on proper organization; the other one adds to organization an element of personal adjustment and flexibility. Both ways are effective ways to organize a winning chief executive team, but the team and each member as also the other managers throughout the business must know which of the two ways of team organization has been chosen.

In particular, there has to be clearly assigned responsibility for the determination of objectives in the eight key areas of business performance and for the careful consideration of the impact of all business actions and decisions on performance and results in these areas. This responsibility can be part of the job of every member of the team: it can be assigned to a Planning Committee of vice presidents. It can be assigned to one man as in General Motors. Or each key area can be assigned to a separate man as a full time job though that is for the very large business only. It is the approach of General Electric, where the executive office in addition to president ad group executives contains a fair number of services vice-presidents, each charged with company wide responsibility in one key area. Size of the company and character of the business are the determining factors here. What matters, above all, is that the responsibility for long range planning and thinking for clear objectives, for the development of adequate yardsticks to measure their attainment, and for the education of managers in the vision and the skills needed to reach the objectives, be clearly spelled out and unambiguously assigned.

The second requirement is that there must be no appeal from one member of the chief executive to another. Whatever any one of them decides is the decision of all of top management.

This does not mean that there should be no one on the team who acts as its captain. On the contrary, a captain is needed. And one man is almost certain to stand out as the senior member by virtue of his intellectual or moral authority. There was, for instance, never any doubt in General Motors that the head of the table was wherever Mr. Sloan sat, and at Sears, Roebuck that General Wood was a good deal more than the “first among equals”. But whenever one man thus stands out, he has to be doubly careful not to countermand or overrule the others, not to interfere in the areas assigned to them, not to let his superiority turn into their inferiority. His strength, in other words, should strengthen his team mates which is the definition of an effective and strong team captain. He is playing captain not a manager calling signals from the bench.

In a team the fewer the members the better for arriving at decisions but they shall be more than two.

Indeed if two men can work together closely, they form an ideal team. But two people like this are rarely found. And two people in a team are always a highly unstable combination. If there are only two men a veteran of a chief executive team once commented even a slight disagreement may become dangerous. If there is a third member, the team can function even if two barely speak to each other. A two man team can function only if the men are held together by strong emotional bonds, which is in it self undesirable. Finally, a two man chief executive team aggravates the problem of succession. Precisely because the two members have to be so close to each other they usually retire together; for the survivor would find it almost impossible to adjust to a new partner. One example of this is Mr. Donaldson Brown’s voluntary retirement from General Motors many years before he reached retirement age when Mr. Sloan retired because of age. Another is the joint retirement of Mr. Swope and Mr. Young from the top management of General Electric. Yet one of the important tasks of the chief executive team is to give continuity to top management and to make succession easy instead of critical or stormy.