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15 - The SBU President – Perhaps the best job for the CEO-in-training

Published online by Cambridge University Press:  19 August 2009

Preston Bottger
Affiliation:
IMD International, Lausanne
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Summary

No discussion of the top leadership team of a global company would be complete without a mention of the role of the strategic business unit (SBU) president. Much like the State of California in the United States has the world's tenth largest economy, when compared to country economies, many global companies have business units whose turnover would put them well into Fortune's Global 500 largest companies

In this chapter, the authors explain how the SBU president's role works within a global organization's top leadership team. They explore the role of the SBU president, as distinct from other CXOs, and how this position has unique leadership challenges that differ from company to company.

The role of the strategic business unit president

Working for three years as the head of our company's largest business unit was the best training I could imagine for the challenges I faced when I became the company's CEO. As the SBU President I was responsible to my boss [the CEO] for the P&L of the business unit, but each month I would receive this huge allocation from ‘corporate’ for all of the central ‘services’. That was one of the first things I changed upon becoming CEO, I took responsibility for corporate overhead into the CEO's office and made sure the SBU Presidents focused only on their business units and what they could directly control. It saved a lot of time and discussion. I of course delegated much of the corporate overhead responsibility to the other CXOs, they could no longer just allocate their costs around the businesses, but rather they had to answer to me and our CFO.

(CEO and former SBU president of a large global manufacturing company)
Type
Chapter
Information
Leading in the Top Team
The CXO Challenge
, pp. 308 - 319
Publisher: Cambridge University Press
Print publication year: 2008

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References

Ready, D. A., ‘Leading at the enterprise level’, MIT Sloan Management Review, 45 (3) (Spring 2004), p. 87.Google Scholar
Bartlett, C. A. and Ghoshal, S., ‘What is a global manager’, Harvard Business Review, Best of HBR, 1992, August (2003), pp. 1–4.Google ScholarPubMed

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