The Role of the Chief Strategy Officer

By understanding how the duties of the chief strategy officer (CSO) can vary significantly from organization to organization, boards and CEOs can make better decisions about which type of CSO is necessary for their leadership teams.

The chief strategy officer (CSO) is a comparatively new but increasingly important role in many organizations. To explore the role of the CSO, we conducted 24 interviews with CSOs at U.K. companies that are part of the FTSE 100 Index, across a number of industrial sectors. Secondary data — company reports, strategy documents and presentations — were used to complement the interviews. All interviews were conducted either at the CSO’s office or via telephone and followed the same semistructured outline and set of questions. They were transcribed verbatim and analyzed through qualitative data management software. From the outset, it was clear that there was a variation in CSO roles, focused on two dimensions. The first dimension was the stage of the strategy process in which the CSO was involved. Our findings identified a significant demarcation between whether the CSO was focused on the formulation of the strategy or the execution of the strategy. The second dimension of variation was how the CSO engaged in the strategy process. Some CSOs were facilitators, advising business units during the strategy formulation or assisting in the execution. Other CSOs were enactors, far more likely to execute the strategy process by themselves or with their team. Based on variation in the roles carried out by the CSOs, we have developed a typology of four CSO archetypes.

1. Internal Consultant

CSOs of this type focused almost exclusively on strategy formulation by themselves or with their strategy team. The execution of the strategy — ownership and responsibility for its implementation — resided firmly with the business units. These CSOs carried out activities similar to traditional management consultants. As one of them stated, “It’s very much like what an external consultant would do; the only difference is that we’re internal.” As a result, we have called this archetype the “Internal Consultant.” This type of CSO adopted a very rational approach to the development of strategy. One of them described the role as “getting the facts on the table, coming up with options, evaluating such options and then recommending [the best] one to the business.

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2 Comments On: The Role of the Chief Strategy Officer

  • Building a successful team | The Turbine | April 11, 2014

    […] look for Chief Strategy Officer’s (CSO) to fill multiple rolls within an organization.  An article from MIT says, “Our findings identified a significant demarcation between whether the CSO was focused […]

  • Yannick Peeters | July 30, 2014

    Planning and strategic development should be a continuous process that is managed & monitored by a CSO. But the initial long-term setup should be created by the CEO / Board in line with the CFO. Initiatives, actions,.. are to be adapted lower levels but they will need approval of higher profiles.

    To do this on a continuous basis, and to make sure that the strategy is communicated, monitored & managed the right way the CSO will need help of a strategy execution system or CPM system.

    The execution of strategy has been at the top of the CEO’s agenda for many years and yet despite the investment in technology systems for planning, budgeting, reporting and analysis, as well as the introduction of performance management methodologies such as the Balanced Scorecard, the ability to execute well is still just as hard to achieve.

    If an organisation is unable to execute its strategy, then it loses the ability to navigate through today’s complex and volatile business environment. Being ‘out of control’ can have dire consequences, which long-term, at best, will result in below par returns for stakeholders and, at worst, will cause the organisation to fail.

    Investments in technology systems that aid planning and provide insightful analyses are at an all time high, and yet many CEOs still find they don’t have the right information to track the implementation of strategy.

    Part of the reason is due to the disconnect these systems have between strategy and the every day actions performed by employees. Most systems, and the way in which they have been implemented, focus on the numbers – budgets, financial results and KPIs – when the focus for performance management purposes should be on actions and their effectiveness in delivering corporate goals. This requires a very different kind of approach and supporting technology system.

    CorPeuM is a unique software solution with capabilities not found in other products. Its focus is on improving strategy execution and so combines strategic, tactical and financial planning capabilities with a specialised workflow engine that ensures plans are fully resourced, implemented and monitored.

    For more information go to http://www.corpeum.com or contact me at Ypeeters@corpeum.com

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