The job of a CEO is to make decisions. But not just any decisions – the right decisions. As an actuary, your work provides valuable insight on important business issues that can help your CEO when making these important decisions. However, for this insight to be effective, you must be able to communicate with your CEO in a way that enables true influence on the decision making process. This requires understanding your audience and allowing flexibility in your communication style. In the Actuarial Review article, How to Talk to a CEO, Dave Ingram and I explained three key considerations that you should keep in mind when communicating with your CEO.
1. Thinking Style
Most corporate executives make decisions by quickly studying a problem against one solution that is quickly selected from their mental library, which has been constructed over years of experience. If that solution appears unworkable, they seek to improve it or identify another solution that would pass the test that the original solution failed. This heuristic-based style of thinking is vastly different than the methodical, technical analysis in which actuaries are trained. However, many CEOs have risen to success based off of this style of thinking and will continue to use it.
2. Risk Attitude
Actuaries and CEOs also tend to differ in their risk attitude. Research shows that more than 50% of top executives favor a “maximizer” view (increasing reward is more important than reducing risk) or a “pragmatist” view (the future is uncertain, therefore it is important to diversity your options). Only a small number of executives hold a “manager” view (carefully quantify and balance risk versus reward), which is preferred by the majority of actuaries.
3. Corporate Priorities
Familiarize yourself with your CEO’s priorities – common priorities include customers, profits, corporate survival and value growth. Use this information to determine what factors will truly motivate your CEO to follow your guidance.
Carefully craft your message so that it will fully resonate with your CEO, so that he or she will be motivated to follow your recommendations. Base your communication style off of your knowledge of their thinking style, risk attitude, and corporate priorities. Actuaries often need to present their recommendations – which are based on careful, rational painstaking analysis – to decision-makers who do not really trust analysis. Therefore, it will likely be more effective to focus on how your insights address corporate priorities, rather than the detailed analytical process by which you arrived at your conclusion.
Have you ever needed to be flexible in your communication style when making recommendations to corporate executives? Share your suggestions on how to better understand and communicate effectively with top executives in the comments section below.