Original question from Quora:
How hard is it to become the CEO of a Fortune 500 company?
I’m hoping that someone who’s done it might take the time to explain some of the hard things it took to reach such a position.
There are basically two paths you can go down to become a CEO of a Fortune 500 company. Both are obscenely difficult but there is one incredible upside…
Both paths are very specific and obvious. You just have to think through the paths.
Option number one, you can go down he corporate route and climb the ladder. Depending on your skill set, you’ll have slightly different paths, but I think there are a couple different things that can make it easier for you.
First, you should align your skills with what will make it easier to hire/promote you, but also be delivering maximum value for the company. Here is what I mean…
About 100 years ago Claude Hopkins, perhaps the greatest ad man that ever lived started out his career as an accountant. He realized after a time that he didn’t want to be an accountant because accounting was a cost of doing business and costs get minimized.
So, he went into sales and advertising because he knew that those things made the company money, so if you want to make a lot of money, or be the most valuable to a company, be part of the business that makes money, not the cost centers they are forced to have.
Thus, HR, Accounting, and Legal are probably worse for getting to the CEO role than operations, sales, and marketing are. That’s not a hard and fast rule, but think about it from a “who is going to make the company the most money” perspective and it seems kind of obvious doesn’t it?
Second, you need to be willing to change jobs to move up faster. This is an important lesson and best described in Scott Adam’s book How To Fail At Everything And Still Succeed.
Early in his adult life, Scott found himself on a plane next to a CEO of a screw company. They were talking about business and the CEO gave him some career advice, “As soon as you land a job, you need to start looking for your next better opportunity.” or something along those lines.
Basically, your next big break isn’t going to align with when you need a job, so always be looking. Also, it’s worth noting that most companies DON’T PROMOTE and DON’T GIVE RAISES like they should for internal employees.
Psychologically this makes sense, the familiar employee already has a value placed on them, and if they are familiar enough, their value is diminished in perception. But, an unknown quantity has a higher perceived value because you don’t know their actual upside.
Thus, if you want to make it to the Fortune 500 CEO type role, you have to be willing to move companies every year or two and keep working your way up the ladder until you are at least at the VP level.
That tip alone can save you decades of slaving away at a single company only to never crack middle management.
So, those are the principles, the actual path then becomes one of building your value, getting promoted, changing companies, and continually working upward until you are at the top tier of management.
Then, it becomes a bit of luck…
When you get to the top 50 or fewer managers, you are with a high performing peer group. Winning the CEO sweepstakes is going to be a game of politicking and luck to a large extent.
But here is a hack that can help your odds…
CEO’s are like quarterbacks in the NFL. Once you are a NFL quarterback, you can be a QB on any other team if you have the chops, but nobody wants to bet on a non-NFL QB as their new starter.
So, one way to end up a Fortune 500 CEO is to shortcut the waiting on the existing CEO to quit game, and taking the CEO role at a lesser company so that you have CEO experience. Simply being a CEO of an existing successful company makes you look like a more capable CEO candidate, and many companies would rather bring in someone who has already been a CEO because that looks less risky.
Again, a lot of this comes down to a kind of luck of the draw and politics and things that aren’t “hard skills” so to speak.
If you hustle and build your career right, there is a pretty clear path to a CEO role in a major company. It’s a lot of smart work done with significant effort.
Option number two, you could build your own company from the ground up and have it end up being on the Fortune 500 list. This is an equally difficult task and requires as much luck as it does effort, but it is possible.
Many of the most famous CEO’s were the founders of their companies and managed to retain the CEO role from employee 1 to employee 100,000. You know, names like Bill Gates, Steve Jobs, and Mark Zuckerberg.
Building a company from nothing to Fortune 500 is a lifetime of work. Perhaps several lifetimes of work. You have to have the right skills, the right people, the right product, the right market, the right timing.
It’s really, really tough.
However, it’s also crystal clear. There are only a handful of business opportunities that will get you to Fortune 500 level. You aren’t going to get there playing the multilevel marketing game with Amway or flipping junk on eBay.
To become a Fortune 500 CEO of your own company, you have to build a Fortune 500 company, and as long as you can pull that off, you too can be a Fortune 500 CEO.
You just have to know he secret to building a Fortune 500 company right?
So those are your two options. Which one will you choose?
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