This chapter focuses on your ability to truly understand how the business runs day-to-day and turn that understanding into reliable, repeatable execution. Boards want CEOs who can see beyond slideware to the real operational heartbeat of the company—how products and services are delivered, where bottlenecks sit, and which levers actually move cost, quality, and service. The skills here assess whether you’ve gone deep enough into core processes, supply chain flows, and execution rhythms to make sound trade-offs between efficiency, resilience, and customer experience. In essence, this chapter helps you evaluate whether you can credibly lead an operations- and execution-heavy agenda at CEO level, even if you’ve never held a classic COO role.
6.1 Understanding core operational processes and key performance levers
What the Board is looking for
When Boards evaluate a candidate’s understanding of core operational processes and key performance levers, they are looking for more than familiarity with dashboards. They want evidence that the candidate has gone deep into how value is actually created and delivered—end-to-end processes, capacity constraints, quality risks, and cost drivers—and used that insight to improve performance. They also look for a track record of focusing on a few critical operational levers rather than chasing dozens of metrics, and of turning those levers thoughtfully rather than reactively. Ultimately, they want someone who can “walk the process,” ask the right questions, and make better strategic and financial decisions because they understand the real operational implications.
Open-ended question
“Tell us about a time when you took the time to truly understand the core operational processes of a business you led—what you learned about how work actually flowed, what you identified as the key performance levers, what changes you made based on that understanding, and what impact those changes had on cost, quality, service, or reliability.”
Rubric – 6.1 Understanding core operational processes and key performance levers
Nascent
- Has not had primary responsibility for major operational processes or end-to-end delivery of products/services.
- Knowledge of operations is largely second-hand, based on reports and presentations rather than direct observation or deep inquiry.
- Struggles to explain clearly how work actually flows through the organization or what the main operational bottlenecks and risks are.
- Uses a wide set of metrics without a clear view of which ones are truly leading indicators or value-critical levers.
Developing
- Has led or co-led parts of operations or worked closely with operations leaders on specific issues or projects.
- Can describe core processes at a high level and identify some key drivers of cost, quality, or service, though depth is uneven.
- Has used operational KPIs to identify and address performance gaps, with some successful improvement initiatives.
- Still relies heavily on functional experts to interpret operational data and connect it to root causes or systemic constraints.
CEO-Ready
- Has had clear accountability for businesses where operational performance (cost, quality, service, safety) was a major driver of results.
- Can articulate end-to-end core processes, key constraints, and the small set of critical levers that drive performance in those businesses.
- Has led initiatives where changes in process design, capacity, scheduling, or standards produced measurable improvements in KPIs and financial outcomes
- Regularly uses a focused set of operational dashboards and reviews to manage performance, challenge assumptions, and prioritize improvement efforts.
Distinctive
- Has repeatedly delivered step-change improvements in operations (e.g., cost, reliability, cycle time, service levels) across different businesses or contexts.
- Can point to situations where deep process insight led to non-obvious but highly impactful interventions (e.g., network redesign, process simplification, constraint removal).
- Is seen by Boards and senior colleagues as someone who quickly “gets under the hood” of operations and identifies the few levers that matter most.
- Across roles, has left behind stronger operational disciplines, clearer KPI hierarchies, and teams that manage performance more effectively because of the frameworks they introduced.
6.2 Setting and managing against operational KPIs and dashboards
What the Board is looking for
When Boards evaluate a candidate’s ability to set and manage against operational KPIs and dashboards, they are looking for evidence that this person can distinguish “signal” from “noise” and run the business accordingly. They want to see that the candidate has chosen a small, coherent set of operational indicators, linked to value and strategy, and then used them consistently to manage performance. They also look for a track record of running regular, disciplined review routines where KPIs drive discussion, root-cause analysis, and action—not just reporting. Ultimately, they want someone who can design and use metrics in a way that actually changes behavior and outcomes on the ground.
Open-ended question
“Tell us about how you have defined and used operational KPIs and dashboards to run a business or major function—what you chose to measure and why, how you set up review routines, how you responded when indicators moved in the wrong direction, and what tangible performance improvements resulted.”
Rubric – 6.2 Setting and managing against operational KPIs and dashboards
Nascent
- Has mostly inherited KPI sets and dashboards, with limited influence over their design or simplification.
- Reviews have been largely backward-looking, focused on explaining variances rather than driving decisions and actions.
- Uses many metrics without a clear hierarchy or line of sight to strategy, value, or customer outcomes.
- Few examples where KPI insights directly triggered meaningful operational changes or interventions.
Developing
- Has refined or reduced KPIs for a team or function, with some effort to focus on the most relevant indicators.
- Can point to a few cases where dashboard trends led to targeted improvement efforts and measurable gains.
- Has established periodic performance reviews using KPIs, though discussion sometimes remains descriptive rather than action-oriented.
- Still experimenting with the right balance between comprehensiveness and focus in metrics and dashboards.
CEO-Ready
- Has led the design or overhaul of KPI suites and dashboards for a substantial business or enterprise, tied clearly to strategy and value drivers.
- Runs regular, disciplined performance dialogues where a concise set of metrics consistently informs decisions, prioritization, and resource allocation.
- Can demonstrate multiple examples where early KPI signals prompted timely interventions that improved cost, quality, service, or risk outcomes.
- Is recognized by teams as someone who simplifies measurement, focuses on the few things that matter, and ensures follow-through on KPI-driven actions.
Distinctive
- Has transformed the way a business manages itself by creating a sharp, value-focused KPI and dashboard framework that became “how we run the company.”
- Can point to sustained improvements in operational and financial performance clearly linked to new KPI designs and review disciplines.
- Their KPI and dashboard approach has been adopted or replicated across other units or organizations as a management best practice.
- Across roles, is known for making performance transparent, actionable, and understood at all levels, enabling faster and more effective execution.
6.3 Supply chain design, sourcing strategy, and risk management
What the Board is looking for
When Boards evaluate a candidate’s capability in supply chain design, sourcing strategy, and risk management, they are assessing whether this person can balance cost, service, and resilience in a world of frequent disruption. They look for evidence that the candidate has shaped or reshaped the supply network, supplier base, and logistics model—not just managed day-to-day issues. They also want to see a track record of identifying critical risks, building redundancy or flexibility where it matters, and acting ahead of potential shocks rather than after the fact. Ultimately, they are asking whether this person can turn the supply chain from a vulnerability into a strategic asset.
Open-ended question
“Describe a time when you meaningfully changed your supply chain design or sourcing strategy—what problems or risks you were addressing, what specific changes you made (e.g., footprint, suppliers, contracts, inventory, logistics), how you assessed and managed the risks involved, and what impact these changes had on cost, service, and resilience over time.”
Rubric – 6.3 Supply chain design, sourcing strategy, and risk management
Nascent
- Has had limited responsibility for end-to-end supply chain or sourcing strategy, focusing mainly on operational execution or local supplier management.
- Supply networks and supplier bases under their remit largely evolved historically, with few deliberate design choices or structural changes.
- Responses to disruptions (e.g., shortages, logistics issues) were mostly reactive and tactical, such as expediting or short-term workarounds.
- Little evidence of structured supply risk assessment, mapping of critical dependencies, or contingency planning.
Developing
- Has participated in, or co-led, initiatives to improve parts of the supply chain, such as consolidating suppliers, renegotiating contracts, or adjusting inventory policies.
- Can point to at least one project where supply network or sourcing changes led to some improvement in cost, service, or risk exposure.
- Has begun to use basic risk tools (e.g., preferred supplier lists, dual sourcing for some items, simple risk registers) with partial coverage.
- During disruptions, was able to implement some planned mitigations, though vulnerabilities and ad hoc responses still featured prominently.
CEO-Ready
- Has led significant redesign of supply chain footprint, sourcing strategy, or logistics model for a substantial business or product portfolio.
- Can demonstrate measurable improvements in cost, service levels, and/or resilience (e.g., fewer stockouts, faster recovery from disruptions, better on-time delivery).
- Has implemented structured supply risk management, including mapping critical suppliers and nodes, introducing multi-sourcing or buffers where necessary, and defining clear contingency plans.
- Track record during major disruptions (e.g., geopolitical events, natural disasters, industry-wide shortages) shows comparatively better continuity of supply and customer service than peers or prior performance.
Distinctive
- Has re-architected supply chains in ways that created durable competitive advantage—such as strategically relocating production, building segmented or flexible networks, or integrating suppliers more deeply.
- Can point to major proactive moves (e.g., early diversification away from high-risk geographies, redesign for nearshoring, building strategic inventory or capacity) that proved clearly prescient in later disruptions.
- Has embedded advanced risk management practices (e.g., scenario-based stress tests, multi-tier visibility, contractual and financial hedges) that are routinely used in strategic and operational decisions.
- Across roles or companies, is recognized by Boards and industry peers as a leader who turns supply chain and sourcing into strategic strengths rather than cost centers or vulnerabilities.
6.4 Continuous improvement mindset (productivity, quality, reliability)
What the Board is looking for
When Boards evaluate a candidate’s continuous improvement mindset around productivity, quality, and reliability, they are looking for evidence that this person treats performance gaps as opportunities, not one-off problems to patch. They want to see a track record of systematically identifying waste, defects, and instability, and then using structured methods to drive sustained improvements. They also look for proof that the candidate has encouraged teams to experiment, learn, and own improvement rather than relying solely on top-down directives or projects. Ultimately, they want someone who will continuously raise the bar on how the organization operates, without burning people out or compromising standards.
Open-ended question
“Tell us about how you have driven continuous improvement in a business or function—what you discovered about productivity, quality, or reliability issues, what methods or approaches you used to address them, how you involved your teams, and what sustained impact you achieved on performance and ways of working.”
Rubric – 6.4 Continuous improvement mindset (productivity, quality, reliability)
Nascent
- Has primarily addressed productivity, quality, or reliability issues through ad hoc fixes or short-term firefighting.
- Few examples of using structured problem-solving or improvement methodologies (e.g., lean, Six Sigma, root cause analysis) in a sustained way.
- Improvements, where achieved, are often not measured rigorously or revisited after initial success.
- Teams under their leadership do not consistently see continuous improvement as part of their day-to-day responsibility.
Developing
- Has led or sponsored several targeted improvement initiatives with clear goals in cost, quality, or service.
- Can point to measurable gains from these efforts, though benefits sometimes plateau or erode over time.
- Has introduced some basic continuous improvement practices (e.g., visual management, regular problem-solving huddles) in selected areas.
- Improvement activity is still somewhat project-based or dependent on their direct attention, rather than fully embedded in the culture.
CEO-Ready
- Has a documented track record of driving sustained improvements in productivity, quality, and/or reliability across a significant business or function.
- Uses structured approaches (e.g., lean, Six Sigma, reliability engineering, standardized work) and insists on clear baselines, targets, and follow-up.
- Has built routines where teams regularly identify, prioritize, and solve operational problems, with leaders coaching rather than just directing.
- Can demonstrate long-lasting improvements (e.g., multi-year trend in efficiency, defect rates, uptime, or service levels) that survived leadership changes and business cycles.
Distinctive
- Has led multi-year continuous improvement programs that fundamentally changed cost competitiveness, quality reputation, or reliability performance of a business.
- Can point to step-change shifts (e.g., industry-leading efficiency, dramatic defect reduction, near “zero downtime”) that competitors or analysts have noticed.
- Has created a culture where continuous improvement is deeply ingrained—ideas flow from the front line, and improvement is seen as “how we work,” not a separate initiative.
- Across roles or companies, is recognized as a transformative leader on operational excellence, leaving behind organizations that continue to improve long after their departure.
6.5 Safety, health, environment, and operational risk leadership
What the Board is looking for
When Boards evaluate a candidate’s safety, health, environment, and operational risk leadership, they are assessing whether this person treats these areas as non-negotiable foundations of performance, not as compliance checkboxes. They want to see a track record of visibly prioritizing safety and risk, even when it conflicts with production, revenue, or schedule pressures. They also look for evidence that the candidate has strengthened systems, culture, and governance around SHE and operational risk—learning from near misses and incidents and reducing exposure over time. Ultimately, they want someone who will protect people, the environment, assets, and reputation with the same discipline they apply to financial results.
Open-ended question
“Describe how you have led on safety, health, environment, and operational risk in your recent roles—include specific incidents, near misses, or risk exposures you faced, what you personally did and decided (especially when it came at a cost), and how your actions changed outcomes, systems, and culture over time.”
Rubric – 6.5 Safety, health, environment, and operational risk leadership
Nascent
- Has mostly relied on existing SHE and risk processes owned by specialists, with limited personal involvement beyond formal approvals or reviews.
- Few examples where they personally stopped work, delayed production, or altered plans due to safety, environmental, or operational risk concerns.
- Incident and near-miss reviews under their remit were largely backward-looking, focused on assigning blame or closing actions rather than systemic learning.
- Safety and risk performance in their area showed little improvement over time, with recurring issues or repeated types of incidents.
Developing
- Has taken visible action in response to at least one significant safety, environmental, or operational risk event or near miss.
- Can point to steps taken to strengthen specific controls, procedures, or training programs following incidents.
- Has begun to discuss safety and risk in regular forums, though commercial and operational topics still dominate most of the time.
- Trend data shows some improvement in lagging indicators (e.g., recordable incidents, environmental events), but leading indicators and cultural measures are less clearly addressed.
CEO-Ready
- Has consistently treated safety, health, environment, and operational risk as core leadership priorities, with clear evidence in decisions and behavior.
- Can demonstrate reductions in incident rates, serious events, or high-potential near misses linked to actions they led (e.g., redesign of processes, controls, or governance).
- Regularly uses both leading and lagging indicators, audits, and risk reviews to identify vulnerabilities and drive preventive action.
- Is recognized by employees, unions (where present), regulators, and Boards as someone who will back safety and risk decisions even when they impact short-term performance.
Distinctive
- Has led transformative improvements in SHE and operational risk performance—e.g., moving a business from poor/average to top-quartile or industry benchmark levels.
- Can point to high-stakes decisions (e.g., shutting down operations, walking away from risky business, major redesigns) that clearly prioritized safety and risk over short-term financial gain.
- Has built a culture where people at all levels feel empowered to speak up, stop work, and address risks, with near misses treated as vital learning opportunities.
- Across roles or companies, is known for leaving behind organizations with stronger risk awareness, safer operations, and more robust SHE systems that continue to perform well after their departure.
