The CEO’s schedule arguably has a lot of impact on a business, but it seems employees know very little about how they spend their time.
This is according to Sadun, who said: “Fundamentally, no one knows what a CEO should do. Most of the time it’s difficult to codify the qualities of a good manager.”
In order to rectify the problem, and satisfy the many employees who glance at the CEO’s closed door in curiosity, Sadun and three colleagues set out to get to the bottom of CEO time management.
“We had no way of knowing what we were going to find,” said Sadun. “We went in with the curiosity of trying to understand the life of a CEO. They should be working with both constituencies, insiders and outsiders. However, if there are governance issues, there might be the possibility that the CEO is in the outside world more for his or her personal benefit than for the benefit of the firm.”
In order to test whether this was true, the researchers enlisted 94 CEOs of Italian firms who agreed to put their lives under the microscope for a week. The CEO’s personal assistant was asked to record every activity the boss engaged in that lasted at least 15 minutes.
The researchers found that 85 per cent of a boss’s time was spent working with other people through meetings, phone calls, and public appearances, while only 15 per cent was spent working alone.
Of the time spent with others, CEOs spent 42 per cent with employees or directors of the firm; 25 per cent with insiders and outsiders together; and 16 per cent with only outsiders.
Managers who spent more time at work were more productive than those who spent less time at work, according to Sadun. For every one per cent increase in hours worked, there was a 2.14 per cent increase in productivity.
“That’s never been shown before, so that was reassuring,” Sadun said. “Furthermore, there are some industries where a CEO really needs to be outside, so we don’t need to be proscriptive, but if you were taking these results literally it would tell you that since a CEO’s time is constrained, he should be mindful of the time spent with his own employees.”
In keeping with the adage that “it’s lonely at the top,” many of the managers studied had little idea of how they could make their time more productive. In fact Sadun suggested the results of the report could help CEOs.
“It’s a way to monitor where the efforts of the CEO are going, and to get them understanding that perhaps spending too much time on the outside might not be as beneficial as they might think,” she said.