Good morning. Reaching the CEO seat can take years of preparation—to say nothing of how much more hard work is required to succeed as a chief executive.
Take for instance Microsoft CEO and Chairman Satya Nadella, who succeeded Steve Ballmer in 2014, when the company was struggling. Fast forward to today, and Nadella wants the software giant to have the most capable, popular AI models on the market. For a Fortune feature, my colleague Jeremy Kahn sat down with the CEO of the tech icon to find out what it's going to take to stay ahead in the AI age.
Kahn writes: “In 10-plus years as CEO, Nadella has reinvigorated the company, successfully steering it through two technological transformations: from PCs to the era of cloud computing, and now, to the age of AI. Nadella’s prescient and early bet on OpenAI and its technology, and the fruitful-if-sometimes-tense relationship that ensued, have given Microsoft as good a shot as any company at supremacy in this new era. The company arguably hasn’t been this powerful since it dominated the PC market in the 1990s ‘Wintel’ era.”
Kahn also notes that there’s no guarantee Microsoft will retain its lead. However, he adds: “Nadella’s approach to leadership reflects his acute awareness of these risks.” He and his team are constantly listening, prioritizing paying attention to pivots in users’ needs and preferences, and continually investing in technologies and talent. You can read Kahn's complete conversation with Nadella here.
Many finance chiefs also want to take on the biggest challenges in business. Egon Zehnder, a leadership advisory firm, recently surveyed 581 CFOs worldwide, finding that 60% want to become CEOs and 70% of respondents believing that they're ready to do so. The most cited obstacles to landing the top seat were networking and visibility (46%), followed by customer and market knowledge (30%), and operational experience (25%).
The S&P 500 average tenure for a CEO is just over nine years, and over the past 20 years, tenures have held fairly stable. But for even the most effective CEOs, there is a right time to consider an exit. My colleague Geoff Colvin explores this in another Fortune feature about how CEOs who stay too long can actually harm their firms.
“Those who study CEOs for a living appear to have homed in on more precise answers—and discovered that the expiration date often arrives just when CEOs have reached that stage where they seem strongest,” Colvin writes. Dumping a leader just because he or she has hit the decade mark may not be be the best strategy for many companies, but most firms should probably begin considering a succession plan within a few years of that. You can read more of Colvin’s deep dive into how boards can get succession planning right here.
Have a good weekend.
Sheryl Estrada
sheryl.estrada@fortune.com
