Running head: The Chief Executive Officer 1

The Chief Executive Officer

Ryker Olsen

Salt Lake Community College

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The Chief Executive Officer

Job Description

A chief executive officer (CEO or president) is one of the most important positions in a

company, they are the highest-ranking executives in a company. CEOs are responsible for

managing the resources of a company, managing the overall operations of a company, as well as

being the main point of communication between the board of directors. The CEO is generally in

charge of managing the company as a whole, in general, or looking at the big picture rather

than specific tasks (like those of the CFO and COO). CEOs directly report to the board of

directors which include the CEO, CFO (chief financial officer), and COO (chief operating

officer). Though it is typical, it is not required or to be expected that the CEO is a member of the

board of directors, like all members of the board of directors, the CEO would need to be elected

by the shareholders in a corporation. Together, the board of directors can do things such as

approve loans to or from their corporation, authorize the issuance of stock, or make major real

estate transactions (Investopedia staff, 2017).

What the CEO does in a corporation can change depending on the size of the corporation.

Large companies generally need a CEO that can be responsible for the over all operations of a

corporation, but this is not always the case. For a larger company, having the title CEO is a

demanding enough job to require other people to take up the jobs of CFO and COO (Solomon,

Poatsy, Martin, 2015, P. 169). In smaller companies, the CEO might also play the part of the

CFO or COO. In a smaller company, a CEO might also have a much more hands on role in the

company. A CEO of a smaller company also might be tasked with the hiring of staff and making

not only all major decisions within the company, but also lower level decisions that could be

filled by managers, and other positions in a larger company (Investopedia staff, 2017).
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General Career Path

Like the salary of a CEO, the general career path of a CEO varies greatly. Depending on

how they became CEO, the level of difficulty of becoming one can also vary. Warren Buffett for

example became CEO of a company in which he invested heavily, but this is not always the case.

How Warren Buffett became CEO of Berkshire Hathaway is not how all other CEOs became

CEO of their respective companies (Cannon, 2016). As already stated, CEOs are generally

elected by shareholders, sometimes after working their way up the positions in the company, but

they can also be the founders of a company (Investopedia staff, 2017).

General Education Experience

While it is advantageous, there is no college/formal education required for a person to

become a CEO, but it is rare to see someone become a CEO (especially a very accomplished

one) without a formal education. Experiencing formal education and completing classes at a

university can provide vital experiences for people looking to become CEOs and give them an

advantage over people who do not have a formal education. Classes completed at a university

can give a future CEO exposure to critical thinking, sharing ideas, and interacting with others,

critical skills necessary for their job (Investopedia staff, 2017).

Average Salary

The salary of a CEO can vary greatly, some having enormous salaries, while others

having smaller (by comparison) salaries. The salary of a CEO completely depends on the

prosperity of the company, as well as the size and success of the company. The average salary of

a CEO depends on what group of CEOs you look at. The average salary of the top 200 CEOs in

2015 was $19.3 million. There is a lot of controversy surrounding the potentially massive

salaries of CEOs in corporate America, simply because of how large the gap is between their
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salaries, and the salaries of their workers. One explanation for this is how valuable a specific

CEO can be to a certain company. For example, Steve Jobs will always be remembered for his

work at Apple Inc. and his many innovations within his industry. CEOs like him, as well as their

salaries can be justified by how indispensable they are to the company, because chances are,

these companies simply do not have another Steve Jobs at your disposal (Investopedia staff,

2017).

Career Outlook

Along with the cons of being in the position of CEO, the outlook for a person in this

career is risky, but the rewards are great if a person succeeds. The salary, in some cases, is

enormous and comes with incredible perks and retirement packages (Investopedia staff, 2017).

As long as there are companies and an economy that supports them, there will be CEOs there to

run them. The Bureau of Labor Statistics has estimated that there will be a CEO employment

growth of 6% between 2014 and 2024 (Clawson, 2017). The outlook of the job as a whole is

certain; there will always be CEOs. On a personal level however, your success within the

position is not nearly as certain.

Bio of Someone in the Profession

Chairman, CEO, and majority shareholder of Berkshire Hathaway, Warren Buffett has a

net worth of $74.9 billion. As of 2017, Buffett is the second richest man on earth (Dolan, 2017).

Called the Oracle of Omaha, Buffett is considered to be one of the most successful investors in

the world. Buffett, in one of his annual shareholders letters claims that Berkshire Hathaway

represents 98% of his total net worth, with him owning 282,611 Class A shares and 194,895

Class B shares, but Berkshire Hathaway is not his only successful investment. Buffett owns 2

million shares of Wells Fargo, 900,000 shares of U.S. Bancorp, 2 million shares of Seritage
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Growth Properties, and 9,000 shares of IBM, and more. Buffett is an 86-year-old married man

with 3 children. Born in Nebraska, he has been known for his abilities to make money since he

was a kid. As a child, he spent his time delivering newspapers and selling candy and magazines.

The first purchase of stock he ever made was when he was 11 years old, from the New York

Stock Exchange. Buffett attended Columbia University where he received his masters degree in

economics. After receiving his degree, Buffett worked as a stockbroker before starting his own

investment firm called Buffett Partnership. At this time, Buffett started purchasing shares of a

textile manufacturer, Berkshire Hathaway, and since then has returned more than 20%

compounded annually. Since reviving Berkshire Hathaway, Buffett and his company have

purchased and invested in many companies, including Goldman Sachs, Swiss Re, and General

Electric. Buffett plans to donate most of his fortune after his death (Cannon, 2016).

Pros and Cons

CEOs have many pros to look forward to during their career and afterward. Top-level

CEOs generally have many perks that come with the job. Many top-level CEOs are given

transportation perks, whether that means protection/security, private jet travel, or ground travel

including a car and personal driver. Top-level CEOs also generally choose the dcor in their

offices which sometimes costs the company a substantial amount of money, but perhaps the best,

or most valuable perk of being a CEO of a large company is the one they get after they

retire/leave. CEOs have been known to receive enormous benefits after leaving a company,

sometimes so large that they create an equally large amount of controversy. In some cases, the

former CEO makes more money in retirement than they did while working. The former CEO of

General Electric, Jack Welch left the company with a planned yearly retirement package of $8

million, not including the maintained access to all perks he had during his time as CEO. Another
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CEO, Edward Hanway of Cigna left the company with a retirement package worth over $110

million. CEOs of top-level companies have enormous benefits on and off the job, but not all

CEOs have it this good. CEOs of smaller or less successful companies will likely not receive

this level of benefits after retirement, or during their career (Investopedia staff, 2017).

The cons of this career are, for one, if you are not a top-level CEO, chances are, you will

not be receiving a $110 million-dollar retirement package. The job of the CEO is one of the

most important jobs in a company, yet it is also a job with setbacks. As a CEO, it is very

unlikely that you would have anyone within the organization giving you feedback on your

performance (Robbins, 2017). The immense amount of potential stress, as well as public

attention, and attention from the media that a person could experience in this career are also huge

cons. Another major con, affecting most, if not all CEOs is the fact that people tell them only

what they want to here. This shut off can cause huge problems for a CEO because they might

not be informed on important things that might be happening within a company, and if a problem

is occurring, they cant do anything to correct the problem (Gregersen, 2017).

Your Fit with this Career

I personally think that I would have an OK fit with this career. As a very motivated and

competitive person, I feel that I would excel in this career. There are some things that I feel

would be challenges however, including the level of potential stress that comes along with the

career. The level of stress and anxiety must be incredible for some of the top CEOs. Health

issues would likely follow this, and this is something I would not like. I also think that the fact

that you are always in the view of the public and your potential shareholders (especially for top

CEOs) would be a heavy burden. I think that it would be very hard knowing that every decision
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you make could potentially cost you your position as CEO, and the satisfaction of your

shareholders.

While CEOs have many burdens that come with their career, I feel that I would excel in

this career. It is very important to me to succeed in everything I do, and I feel that this would be

no different if I were CEO of a company.

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Sources

Cannon, C., Halford, D., & Harris, B. (2016, January 01). Bloomberg Billionaires Index

Warren Buffett. Retrieved July 30, 2017, from

https://www.bloomberg.com/billionaires/profiles/warren-e-Buffettt/

Clawson, C. D. (2017, January 27). Chief Executive Officer Career and Salary Profile. Retrieved

July 30, 2017, from https://www.floridatechonline.com/blog/business/chief-executive-

officer-career-and-salary-profile/

Dolan, K. A. (2017, June 06). Forbes 2017 Billionaires List: Meet The Richest People On The

Planet. Retrieved July 30, 2017, from

https://www.forbes.com/sites/kerryadolan/2017/03/20/forbes-2017-billionaires-list-meet-

the-richest-people-on-the-planet/#61d7ce3262ff

Gregersen, H. (2017, February 21). Bursting Out of the CEO Bubble. Retrieved July 28, 2017,

from https://hbr.org/2017/03/bursting-the-ceo-bubble

Investopedia Staff, I. (2017, March 09). Chief Executive Officer - CEO. Retrieved July 26, 2017,

from http://www.investopedia.com/terms/c/ceo.asp

Robbins, S. (2017, July 13). What do CEOs do? A CEO Job Description. Retrieved July 30,

2017, from http://www.steverrobbins.com/articles/ceojob/

Solomon, M. R., Poatsy, M. A., & Martin, K. (2015). Better business. NY, NY: Pearson.