Top 10 challenges for CEOs in 2011

December 31, 2010

— Charley Polachi is the co-founder of Boston-based executive recruitment firm Polachi, Inc. The views expressed are his own. —

1. In 2011, CEOs will be challenged with balancing expectations for earnings per share (EPS), which in most cases are already set, and their investors’ growing impatience for top-line growth. To grow, CEOs have to invest again. But if they invest, they could miss EPS estimates. The CEOs who walk this tightrope successfully will pull away from the pack and outperform their peers.

2. Maintaining momentum in the slow growing market. Solution is innovation.

3. European governments and their economies continue to perplex – look at Greece and Ireland. Who’s next? Finding efficient ways to get revenue internationally through distributors and partners instead of employees may be the way to go.

4. 2012 presidential election season starts in Q1 2011, how will Republicans and Democrats deal with the economy? What happens to capital gains treatment will definitely impact investors in the venture capital and private equity worlds. This will cause CEOs to look at alternative sources of financing, so hoarding cash will be even more important.

5. The next generation of workers don’t care. They’ve seen what happened to mom and dad in the last two years. who can they count on/trust? CEOs will need to work extra hard to attract and retain Millennials who tend to want to move up quickly or move on.

6. Housing market will continue to be a problem, people can’t sell their houses and relocate to where there are jobs. So CEOs will need to be flexible, allow more telecommuting – let technology work. Video, Skype, unified communication platforms, etc. will become common.

7. The time to retirement has just been extended by 5-10 years due to losses in private retirement accounts, pending legislation changes and employment uncertainty. Will we work until we drop? This has mixed blessings for CEO’s – they get to keep reliable, well-trained employees longer, but what to do as far as providing upward mobility for the Millennials?

8. We are no longer the best or cheapest producer in the world. All we do well is outsource, offshore and innovate. We need to turn middle America into the outsourcing capital of the world – will the workers be there with competitive wage demands? CEOs need to capture these people who want to work and train them.

9. College degrees are no longer a guarantee for a better quality of life and higher income like our parents’ generation, so kids are not attending or finishing college. Is this a problem? CEOs may need to rewrite their job specifications.

10. The world is flat – it’s Mumbai, Dubai, Shanghai or bye–bye. CEOs need to travel and meet clients, customers, business partners, etc. The key is how to do this safely and cost effectively.

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