Today is the first day for Chuck Robbins in his role as CEO of Cisco Systems.
Chuck is the only sales leader turned CEO in the Fortune 100. The only one. Boards at the big companies just don’t hire sales leaders into the CEO role.
If you are a sales leader, and want to be a CEO someday, you need Chuck to knock it out of the park. This will give Boards confidence to hire more sales leaders as CEOs. So, join me in pulling for Chuck. Your advancement depends on it.
Don’t believe me?
Check this out:
Sales is among the least common pedigrees of Fortune 100 CEOs. The most common backgrounds are:
- Finance – 28
- General management – 24
- Engineering – 11
These three pedigrees alone account for 63% of Fortune 100 CEOs.
In addition to these, there are 18 other pedigree pathways to the corner office. Here is the distribution for each.
The hiring decisions made by the boards of the Fortune 100 seem odd. For example, they have hired more accountants as CEOs than sales leaders, more lawyers and consultants as well. In fact, statistically, it is just as likely for a publisher or an underwriter to become a CEO in the Fortune 100 as it is a sales leader.
Are the boards of these companies correct? Is it a mistake to have a sales leader take over as CEO?
Unfortunately, a sample size of 1 does not allow for data to give us the answer. There is no empirical data that says a sales leader will outperform a traditional CEO. However, there is data that suggests trying a different hiring profile might make sense. The share price appreciation of some of the companies on the Fortune 100 list, led by CEOs with financial pedigrees, have underperformed the broader market.
There are many factors affecting share price appreciation, and I am certainly not suggesting causality here. I am sure these finance leaders turned CEO are very capable. I point this out only to suggest that considering an alternative CEO hiring profile is worthy of consideration.
If you find this argument interesting, and are debating whether to hire a sales leader as your CEO, consider the following:
- Great companies are customer focused and no one understands customers better than the sales leader.
- In a world where products are commodities, and price advantages are temporary, companies win, or lose, based on the customer experience. The sales leader turned CEO has more relevant experience in this area than finance, general management, and engineering, combined.
- Organic growth comes from taking market share away from competitors. The sales leader knows how to take share by winning the on-the-ground battles, as he/she has been fighting them for decades.
Progressive boards, looking for above average returns for its shareholders, might follow Cisco’s lead and hire a sales leader into the CEO spot. Only time will tell if such as shift does indeed produce superior results.
In the meantime, let’s pull for our sample size of one, Chuck Robbins at Cisco. If he delivers, maybe some of you will get a chance to run a company.
Good luck Chuck.