Opinions & Interviews

2020-02-24 Rachele Anconetani, Maurizio Dallocchio, Leonardo L. Etro, Giulia Negri, Matteo Vizzaccaro

Managerial Excellence: A Value Beyond the Confines of Performance

Founded in 2017 to reward Italian entrepreneurial excellence from both an economic-financial standpoint and regarding respect for the values of sustainability, the SDA Bocconi School of Management's Best Performance Award (BPA) has now reached its third edition.*

Founded in 2017 to reward Italian entrepreneurial excellence from both an economic-financial standpoint and regarding respect for the values of sustainability (environmental, social and governance - ESG), the SDA Bocconi School of Management’s Best Performance Award (BPA) has now reached its third edition.*

The Award is divided into five categories, each of which brings together companies that have demonstrated pro-active attitudes in ESG initiatives in their sector. In particular, the hot topic this year is that of managerial excellence, promoting companies that stand out in terms of cutting-edge leadership attentive to the implementation of best practices in the workplace and in the management of human resources.

This is the result of the recognition that strong leadership has become increasingly essential to guide the profound cultural transformations and performance of a business. Through the BPA, the aim is thus to focus the issue of managerial excellence on two levels of analysis:

-          the emphasis on human capital, recognizing leaders as the figures that enable the construction of an excellent, managerialized society;

-          the perspective of business continuity, asking the proprietor/founder to go beyond their individuality to lay the basis for a structured system of governance open to the outside world.

For these reasons, the study was produced by exploiting the theoretical basis of the “transformational leader,” i.e. promoting the ability to guide a business along a process of metamorphosis, creating a new, radically different structure than before, in form and character.[1]

The analysis involved 18 companies in the BPA sample, that were compared using the methodological principles of the “distance to frontier” approach and exploited the information gathered through ad hoc questionnaires administered to the front line staff and the CEOs of companies following a structured process illustrated in Figure 1.

Figure 1 The “Managerial excellence” sample


The final ranking was then defined based on four investigative profiles:

  1. analysis of the governance structures and corporate strategies, both current and for future implementation, that incentivize managerialization processes;
  2. analysis of CEO perceptions with respect to both their role as leaders and the business structures in managing remuneration or feedback processes;
  3. analysis of the opinions of the front line staff (TMT[1]) on the actions of the CEO and the management systems currently in place.
  4. the incidence and significance of the perceptions investigated above were further weighted based on the number of TMT contacts available for each business.

The results show that CEOs’ perceptions of their actions and the managerial structure are on average more positive than what is attributed to them by the TMT, although the difference is marginal. Despite this discrepancy, the results are however encouraging and show higher average scores of 7 out of 10 for both CEOs and the TMT. This provides a general perspective, which however is not uniform across the single indicators of the analysis (Figure 2): on the one hand, the TMT recognizes the CEO as a strong figure expressing the company values and stimulating others to reach the company’s strategic goals, encouraging creativity by personnel and activating structured feedback processes. On the other hand, there are criticalities in the link between the CEO and the TMT, traceable to salary characteristics and the diversity of the business.

The investigation also shows a clear gap in perception on the salary gap between the two classes of managers, which among other things, does not seem to be fully justified by the skills of the CEO.

Figure 2 A comparison between the perceptions of CEOs and the TMT


Given a sample of companies in which over 80% are family businesses, we come to the second theme that defines the analysis of managerial excellence, that is, the management of generational shifts.

The urgency of activating adequate governance procedures and measures increases in the presence of destructured management models and CEOs close to retirement age. The entry of new leaders into the company’s “legacy” is a complex process, that requires profound organizational and cultural interventions. Long-term success thus depends on the ability to integrate the moment of the leadership transition into the company’s strategic vision. In over 80% of cases, the BPA companies have activated (or are activating) procedures to manage the generational shift through changes to their By-laws aimed at increasing the decision-making power of future shareholders and shareholders agreements, the identification of outside management, and lastly, the sale of part of the company to a private equity fund or other institutional investors.

In a context in which a company can be identified as a group of people who collaborate and organize themselves to reach specific objectives, the role of the leader, the management model, and the management of generational shifts can influence the performance of businesses with respect to their competitive context. In the BPA, entrepreneurial excellence and performance are shown by visionary leaders able to transmit the company’s values to the entire organization, inspiring ideas and motivating the organization to reach long-term goals. Furthermore, in a family-based organization, successful businesses are also those prepared to face delicate generational shifts through mechanisms of managerialization and standardization of processes incorporated in open corporate governance models.

The success of a business cannot be separated from excellent leadership, and as Sergio Marchionne said: “Leaders, great leaders, are people who have a phenomenal ability to design and redesign relationships of creative collaboration within their team.”

[1] The Top Management Team groups the front line personnel who answer directly to the company CEO.

[1] J. M. Burns, Transforming leadership: A new pursuit of happiness, New York, Grove Press, 2003.