This framework is developed by a team of former McKinsey and Big 4 consultants. The presentation follows the headline-body-bumper slide format used by global consulting firms.
This product (4 Models of Management) is a 24-slide PPT PowerPoint presentation slide deck (PPTX), which you can download immediately upon purchase.
This framework discusses 4 models of management, defined by how the "Corporate Core" engages and manages the business units.
The Corporate Core is comprised of the CEO, his or her senior management team (e.g. CXO), and a defined set of support functions necessary for the entire organization. The Corporate Core can be categorized along a spectrum of 4 different corporate management models:
1. Holding Company
2. Strategic Management
3. Active Management
4. Operational Involvement
These 4 management models are defined by the way senior management and the Corporate Core engage with the rest of the organization. The type of management model has direct implications on CEO succession, as well as other implications for the leadership team.
This presentation discusses these 4 models of management in-depth. Additional topics discussed include CEO tenure, Value Creation, CEO characteristics, among other topics.
This deck also includes slide templates for you to use in your own business presentations.
The PPT delves into the nuanced differences between insider and outsider CEO tenures, highlighting how internal hires tend to have longer tenures compared to those brought in externally. This insight is critical for organizations considering succession planning and the impact of leadership continuity. The analysis extends to unplanned turnover, where the reasons for CEO exits are dissected, providing valuable data on the stability and challenges within each management model.
The presentation also includes a comprehensive comparison of forced turnover rates across the four models, revealing that demotion is more prevalent in non-holding management structures. This data-driven approach equips executives with the knowledge to anticipate and mitigate potential leadership disruptions. The deck is not just theoretical; it offers actionable templates for immediate application in your strategic planning sessions.
This PPT slide presents an analysis of CEO tenure across 4 distinct management models, highlighting significant variations in the duration of leadership based on the model employed. The data indicates that the median tenure of outgoing CEOs differs markedly, with the "Holding" model showing the longest average tenure at 6.5 years. This suggests that organizations utilizing this model may benefit from stability in leadership, which can be crucial for long-term strategic planning.
In contrast, the "Operational Involvement" model has the shortest median tenure at 4.9 years. This could imply a more dynamic environment where CEOs may face higher turnover due to the demands of operational engagement. The "Strategic Management" and "Active Management" models fall in between, with median tenures of 5.3 and 5.0 years, respectively. The data also reveals that a significant percentage of CEOs in the "Holding" model stay for eight years or more, while a notable portion in the "Operational Involvement" model exits in less than 4 years.
The accompanying percentages provide further insights into the distribution of tenures across these models. For instance, 39% of CEOs in the "Holding" model remain for extended periods, while only 17% in the "Operational Involvement" model do the same. This disparity underscores the impact of management structure on leadership stability. Understanding these dynamics can help organizations make informed decisions regarding CEO succession and the strategic alignment of leadership with business objectives.
This PPT slide presents a comparative analysis of CEO characteristics across 4 distinct management models: Holding, Strategic Management, Active Management, and Operational Involvement. It highlights 3 key metrics related to outgoing and incoming CEOs, providing insights into their experiences and roles.
The first chart focuses on outgoing CEOs with prior public company CEO experience. It reveals that 23.6% of outgoing CEOs in the fourth model possess this experience, significantly higher than the other models, which range from 8.7% to 10.2%. This suggests that the fourth model may favor seasoned leaders with substantial public company backgrounds.
The second chart examines incoming CEOs who also hold the position of chairman. Here, the data shows that 14.1% of incoming CEOs in the fourth model hold both titles, compared to lower percentages in the other models, indicating a trend towards consolidating leadership roles in this model. This could imply a strategic approach to governance that enhances decision-making efficiency.
The third chart illustrates outgoing CEOs transitioning to a chairman role. Notably, 44% of outgoing CEOs from the second model move into this position, with the fourth model following closely at 40%. This trend suggests a strong correlation between management style and the likelihood of retaining a leadership position post-tenure.
Overall, the slide emphasizes the importance of management model selection in shaping CEO profiles and their subsequent roles within the organization. The data suggests that operationally involved and actively managed CEOs are more likely to retain influence, which can be a critical consideration for organizations assessing leadership continuity.
This PPT slide presents a comparative analysis of CEO tenure based on their hiring background—whether they were insiders or outsiders. It highlights a clear distinction in the median tenure of outgoing CEOs, with insiders averaging 6.3 years, while outsiders average significantly less at 4.5 years. This data suggests that CEOs promoted from within the organization tend to have longer tenures compared to those brought in from external sources.
The chart categorizes the tenures into 4 management models: Holding, Strategic Management, Active Management, and Operational Involvement. For insiders, the tenure across these models is relatively consistent, with all models showing values around 5.0 years or higher. The Holding model stands out with the highest tenure at 6.3 years. This indicates that insiders, likely due to their familiarity with the company culture and operations, can navigate their roles more effectively.
In contrast, the tenure of outsider CEOs is noticeably shorter across all models, with the highest being 4.5 years in the Holding model and decreasing to 3.3 years in the Operational Involvement model. The data implies that outsider CEOs face greater challenges in adapting to the existing organizational dynamics, which may contribute to their shorter tenures.
The note at the bottom clarifies that the data excludes interim CEOs and turnover resulting from mergers and acquisitions, focusing solely on permanent appointments. This analysis serves as a valuable insight for organizations considering CEO succession strategies, emphasizing the potential benefits of promoting from within.
This PPT slide presents an overview of the Holding Company management model, characterized by a highly diversified structure and a disengaged management style. It emphasizes that the CEO operates similarly to a hedge fund manager, overseeing a portfolio of investments without delving into the operational intricacies of the subsidiaries. This model is particularly appealing for organizations that prefer to maintain a hands-off approach, allowing second-tier executives to manage day-to-day operations.
The "Management Needs" section succinctly states that the CEO is primarily focused on the outcomes generated by the subsidiaries, rather than the processes that lead to those results. This indicates a preference for high-level performance metrics over granular operational details. The slide also highlights the importance of the Corporate Core, which is responsible for establishing managerial and financial discipline across the organization. This suggests that while the CEO may not be involved in daily operations, there is still a framework in place to ensure accountability and performance.
The "Value Creation Model" section points out that value is created through effective portfolio management, reinforcing the idea that the Holding Company model thrives on strategic oversight rather than operational involvement. The example of Berkshire Hathaway serves to illustrate a successful application of this model, suggesting that potential customers can draw insights from its practices.
Overall, the slide effectively communicates the essence of the Holding Company model, making it clear that this approach is suitable for organizations looking for a streamlined management style that prioritizes results over processes.
This PPT slide presents an overview of 4 distinct management models: Holding Company, Active Management, Strategic Management, and Operational Involvement. Each model is characterized by the level of engagement and oversight that senior management exerts over the organization.
The Holding Company model is described as highly diversified and features a management style that is the most disengaged. This suggests that the company may own various businesses, but does not actively intervene in their operations, allowing each entity to operate independently.
Active Management represents a more integrated approach. Here, the management oversees organizations that are more closely linked, providing guidance primarily on operational issues. This model implies a higher degree of involvement than the Holding Company, focusing on collaboration and support among related businesses.
Strategic Management is positioned as a guiding force within the organization. This model emphasizes the role of senior management in setting strategic direction and performance objectives for a group of related businesses. It indicates a proactive stance in shaping the future of the organization through strategic initiatives.
Operational Involvement is characterized by a high level of engagement from senior management in day-to-day operations. This model reflects a hands-on approach, where management is actively involved in decision-making processes, ensuring that operational goals align with broader strategic objectives.
The slide also notes that organizations can transition between these models, suggesting flexibility in management styles based on evolving business needs. This adaptability can be crucial for companies navigating complex market environments. Understanding these models can help potential customers identify which management approach aligns best with their organizational goals.
This PPT slide presents the Active Management model, emphasizing the role of the Corporate Core in overseeing and advising business units on operational matters. It highlights that this model fosters tighter integration among organizational components, allowing for more direct involvement in decision-making processes. The Corporate Core is positioned as a facilitator of accountability, working closely with business units to ensure alignment on major operational decisions.
Key management needs are outlined, specifically the desire for clarity on how business units will execute their strategies. This indicates a shift towards a more collaborative approach, where the Corporate Core not only sets expectations, but also engages in the development of plans alongside business units. The value creation model is centered on partnership, suggesting that expertise-based services are co-developed to enhance operational effectiveness.
The slide also stresses the importance of defining the rules of engagement between the Corporate Core and business units. Clear communication is essential for establishing when the Corporate Core should be involved in decision-making and when business units can operate independently. This delineation is crucial for maintaining operational efficiency and ensuring that strategic objectives are met.
An example of McKesson is provided, illustrating a real-world application of the Active Management model. This contextualizes the theoretical aspects discussed and offers a practical reference point for potential customers. Overall, the slide serves as a concise overview of how the Active Management model can enhance organizational coherence and operational agility.
This framework is developed by a team of former McKinsey and Big 4 consultants. The presentation follows the headline-body-bumper slide format used by global consulting firms.
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