How to Become CEO – CEO Factories
In the article Corporate Career Success – How to Become CEO we described in detail the key vital traits required to become a CEO. In this article we will address the question of how to become a CEO from a different angle. This time we will be focusing on the companies that will give you the type of experience that will most likely lead to a CEO position.
You may be surprised to know that one in five CEOs of public companies with a market value of at least $2 billion have one thing in common. They all have held a job at one of just 20 companies, and one in every 10 CEOs have worked at one of eight companies. Two companies in particular stand out at producing the most CEOs: General Electric and IBM.
Even though these two giants have developed the most CEOs, that are other companies where you would have a better change of getting to the top job. For example, GE has a workforce of 300,000 employees, and has produced 26 CEOs of $2 billion plus public companies. Therefore, GE employees have a 1-in-11,540 chance of becoming the CEO of such a company. At IBM the odds are even worse, with 1-in-20,360 employees reaching the pinnacle of the corporate world.
On the other hand, McKinsey, the CEO factory with the best odds of producing the CEOs of large public companies has a workforce of 11,000 and has produced 16 CEO alumni. This puts them in the lead with a 1-in-690 shot for its employees. The second best is Deloitte & Touche, at 1-in-2,150 odds.
The top consulting firms, including McKinsey, Deloitte, PricewaterhouseCoopers, Ernst&Young and the now-defunct Arthur Andersen all rank in the top 20 as CEO factories. These companies like to hire the top MBA grads and put them through the grind with an aggressive up or out approach.
The top 19 companies at producing CEOs in descending order of odds of becoming CEO based on the number of employees are as follows:
- McKinsey
- Deloitte & Touche
- Baxter International
- PricewaterhouseCoopers
- Ernst & Young
- Merrill Lynch
- Motorola
- Intel
- Procter & Gamble
- General Electric
- Honeywell
- Novartis
- PepsiCo
- Disney
- ExxonMobil
- Johnson & Johnson
- IBM
- AT&T
- Citigroup
One thing to keep in mind when looking at this data is that it reflects the companies that produced today’s CEOs in past decades. It may not necessarily reflect today’s best CEO factories. In the world of business, success breeds success, and the most successful companies of today may be training the CEOs of tomorrow.
But not all successful companies are alike. Few are able to develop the kind of leadership skills required to run some of the world’s largest corporate conglomerates. Only a few companies are capable of identifying top talent and giving them the opportunity to develop by putting them through stretch assignments domestically and abroad.
A good example of this is the story of Tony White, the CEO of Applera, a 26-year Baxter alum. At the young age of 28 he had become general manager. Baxter is very good at giving people freedom and allowing them to make mistakes, which is fundamental for growth. “Where else in the world could you get that?” asks White.
If you develop the 22 vital traits of a CEO as described in the book How to Think Like a CEO by D.A. Benton, get an MBA from a top school, and get a chance to work in one of the 19 CEO factories mentioned above, you will greatly increase your odds of becoming the top person of a large corporation.
Posted: 14 January, 2008 under category Achieving Success, Career Success.
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