chief strategy officer (CSO)
What is a chief strategy officer (CSO)?
A chief strategy officer (CSO) is a C-level executive charged with helping formulate, facilitate and communicate an organization's strategic initiatives and future goals. The CSO often reports to the chief executive officer (CEO) or the chief financial officer (CFO), working closely with them, the senior leadership team and the board of directors to develop the organization's long- and short-term strategic initiatives and guide it through the planning processes.
The CSO's contribution to the company often goes beyond strategy development. The role typically also works with business units to assist with strategy development and execution, business development and project management. CSOs also work with stakeholders and management teams to support strategic decisions and strategic direction that let an organization take advantage of the broader business landscape and trends.
The position of the CSO is relatively new and has become more prevalent in the C-suite in the last decade as digital business and growth strategies have increased in complexity. The CSO role goes by many titles, including chief strategist and vice president of corporate strategy or strategic development.
Notable companies that have employed a chief strategist include Accenture, Cisco, Cognos, IBM, Intel, Microsoft and Verizon.
Why businesses should have a CSO
The question has been raised as to why this fairly new C-level role is necessary, given that executing a business and company strategy has traditionally fallen under the purview of the CEO. Management experts note that running a business in today's fast-paced, disruption-laden digital business environment is complex and challenging. It requires organizations to be nimble, forward-thinking and globally focused.
Top executives and senior leadership teams are facing pressure to cultivate and implement more comprehensive strategic initiatives that give their organizations a competitive advantage. More organizations are realizing that strategic planning is a complex, full-time job. It requires more focus, decision-making, problem-solving, structure and exactitude than a CEO alone can provide. CSOs have the diversity of experience to support CEOs with establishing new businesses, assisting with mergers and acquisitions (M&A), and leading the planning process and related project management initiatives to achieve such goals.
Who qualifies as a CSO?
The backgrounds and experience of people who become chief strategy officers vary. People suited for the role typically aren't forging a linear path up the corporate ladder; they're often already in high-level strategic positions in successful Fortune 500 companies or top-tier consulting firms.
Recruiting candidates for the CSO role is more challenging than recruiting for other executive officer positions, partly because these individuals are unlikely to be actively looking for new opportunities. CSO candidates often emerge from within an organization's ranks, rather than coming into the role as an external candidate. Internal candidates bring a lot of institutional knowledge to the role.
In general, CSOs need strong planning and leadership skills, and they must also be excellent communicators and marketers.
CSO roles and responsibilities
CSOs are charged with developing and clarifying the vision of an organization, communicating it internally and externally, and sustaining implementation efforts. Specific CSO responsibilities tend to vary from company to company, but there are some commonalities.
In its research, Deloitte found that the CSO job involves what it describes as "the six faces of a CSO." Those six roles are the following:
- Advisor. In this role, the CSO defines the organization's strategic priorities and provides guidance to the CEO and other C-suite executives, such as the chief operating officer and CFO.
- Sentinel. The CSO monitors the market and competitors, looking for external opportunities and risks that could affect the organization.
- Banker. The CSO partners with the CFO and other financial leaders to understand the budgetary impact and requirements of strategic priorities.
- Engineer. In this role, the CSO is the architect of the organization's strategic planning process and leads the strategy execution.
- Aide-de-camp. The CSO supports the CEO as a senior advisor on many executive activities, including board presentations and senior leadership workshops.
- Special projects leader. Here, the CSO leads ad hoc, high-priority initiatives, providing strategic support and guidance.
In many companies, the CSO takes on even more roles, such as these two:
- Pusher. The CSO serves as a champion in support of numerous initiatives and builds consensus among key stakeholders.
- Examiner. The CSO observes and reviews activities to ensure they're performed correctly and identifies areas for improvement.
Betterteam, a company that provides cloud-based recruitment management software, created this list of CSO responsibilities:
- Develop strategic plan in conjunction with other business leaders.
- Work with the CFO to develop a financial plan for strategy.
- Analyze how the organization is doing in its market, looking at market share and product-line performance.
- Identify potential capital projects, joint ventures, M&A targets and other strategic opportunities.
- Assess risks involved in the strategic plan.
- Communicate strategy across the organization.
- Guide and oversee the implementation of business initiatives.
- Use suitable metrics and key performance indicators to measure performance and progress.
While CSOs focus primarily on building a business strategy with a three- to five-year perspective, they must also take a longer-term view, developing a strategic vision for the next five to 10 years.
Depending on the organization's size and culture, the CSO might have a direct role in strategy implementation as part of a dedicated team. Alternatively, they might function as facilitators whose job is to help the business lines carry out the strategy.
Chief strategy officer vs. chief marketing officer
The chief strategy officer role sometimes gets compared to that of the chief marketing officer (CMO). Both are involved in creating organizational strategies based on market conditions to generate growth and gain a competitive advantage.
However, the work of the CSO is centered on what needs to happen internally to drive growth. They define strategic priorities, evaluate market opportunities and risks, formulate a plan to optimize short- and long-term growth, and work with various stakeholders to execute the strategy.
In contrast, the CMO has an externally facing perspective and stays focused on achieving growth by building brand awareness, customer demand and retention, and reputation. The two roles often work closely together and, in some cases, may be combined into a single position.
Becoming a chief strategy officer
Most CSO candidates rise from within an organization, but external candidates can break into the role. Successful CSOs have extensive knowledge of an organization. That knowledge is coupled with a number of other skills: creativity, decisiveness, business sense, financial acumen, excellent communication skills, project management expertise and the ability to build consensus among key stakeholders.
Given the role's visibility, CSOs must also be comfortable delivering presentations to a variety of audiences, from executive boardrooms to companywide town halls.
As a member of the C-suite, CSOs are expected to have extensive professional experience and often more than one academic degree in a business-related field. It's a role that business or marketing professionals typically attain toward the middle or end of their career. Prior to taking on this role, CSOs often are senior vice president or vice president of strategic planning.
Advantages and disadvantages of having a CSO
A skilled CSO can align siloed teams to work collaboratively toward joint business goals. They achieve this by developing and executing strategic plans, encouraging innovation, analyzing market trends and integrating the strategy within the organization's mission and vision.
The most significant disadvantage of having a CSO is likely its cost. While the CSO is an essential role within a large enterprise, it's more of a nice-to-have one for small and medium-sized organizations. An external consultant can be a cheaper alternative.
Another challenge for the role is: If a CEO is unwilling to delegate strategy work to a CSO, the role quickly becomes ineffective. The same is true if other parts of the organization are unwilling to accept change.
Future of the CSO
For those in the role of the chief strategy officer and also for aspiring CSOs, the future is bright. As business ecosystems continue to become more complex, there will be strong demand for executives skilled in successfully formulating and executing an organization's strategies.
In addition, owing to its proximity to the CEO and the overall workings of the business, the CSO role can also be a steppingstone to a CEO job.
Having a well-thought-out strategic plan is critical. Take a look at these IT strategy templates that can help CIOs make IT a business driver.
