How CEO shirking affects company performance

Too much golf  and not enough
running around saving the World?

Here's the body of an email (reproduced with permission) from Stewart Forsyth on the influence of a CEO's past-time activities on the performance of their business:

Here’s an interesting contrast – illustrating that CEOs can make a difference to the performance of their business.

A study published this month, by Peter Limbach of the Karlsruhe Institute of Technology and Florian Sonnenburg of the University of Cologne, found that companies in America’s S&P 1500 index whose CEOs had finished a marathon were worth 5% more on average than those whose bosses had not.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2489967

In contrast a paper from Lee Biggerstaff at Miami University, David C. Cicero at the University of Alabama, and Andy Puckett at the University of Tennessee published in August looks at the relationship between CEOs that play lots of golf and the performance of those CEOs’ companies.  More golf – lower performance.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2495105

Stewart Forsyth

FX Consultants

making performance matter

http://www.fxc.co.nz - getting the most from your people

http://www.personaplus.co.nz - personal development

Gary:

What can we conclude from each of these studies when laid out alongside each other?

Please bear in mind that I am going way beyond the findings of these studies with the following commentary:

• A successful CEO is one who is mentally focussed on the job, physically present, in good health and presumably not impaired by alcohol (I would include pharmaceuticals and other drugs as well as alcohol).
• A CEO must accept that work comes first and one's recreation comes second and the choice of recreation is best one that supports the job in terms of helping sustain mental and physical health.
• Playing golf is time-consuming, especially when factoring in travel and time spent at the bar post-game, whereas running generally involves a quick change or clothing and a trot around the block at the beginning or end of the day.
• Golf can be most frustrating, whereas slow, repetitive running  may be meditative, during which "aha" solutions to frustrating problems may be found (Only if one is quite fit - mind you!). 
• Golf is actually quite sedentary nowadays, there may be little or no walking and the game often involves consuming alcohol afterwards which means less stamina and presumably more ill health as compared to runners, plus degrees of alcoholic impairment (Sorry to all the health-conscious golf enthusiasts reading this - I'm not intending to dump on golf with these generalisations - golf can be wonderful exercise!).
• In defence of golf, it is argued that many a business deal has been consummated during a game; however I wonder how many deals and relationships have been ruined by a bad round, or from the tactless thrashing of an opponent! 
• Finishing a marathon is one thing; but do I wonder if there is a difference in CEO performance between the casual marathon runners and those that are obsessive compulsive - out running all hours of the day, racing beyond their ability and generally in a state of chronic physical and mental exhaustion?  Sub-groups within groups are always fascinating to compare!

I think the main message of these studies is that work must come first for the CEO and the choice of recreation must be supportive of the workaholic lifestyle - be the pastime golf, marathon running, gardening or any combination of healthy activities.

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The advice in these articles is given freely without promise or obligation. Its all about giving you and your family the tools and information to take control of your health and fitness.

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