SOUTHERN CALIFORNIA JOB MARKET : POWER, PRESTIGE, STATUS : CEO: Buck Stops Here--and the Headaches Start

Computer pioneer Seymour Cray had exercised the power and perquisites of a corporate chief executive for nine years when he took a step that summed up how he felt about the job.

He picked somebody else to be CEO of Cray Research. And then he went back to full-time work in the lab. “He knew everything he wanted to know about administration, and it wasn’t for him,” said Donald Hambrick, a professor at Columbia University School of Business.

Cray, a reclusive genius who is sometimes called the Thomas Edison of the supercomputer, was anything but the average chief executive. But abdication contains a grain of wisdom about the limitations of a job that for so many is the goal of a lifetime’s striving.

Life at the top offers status, the power to shape major change, and often an exhilarating opportunity to move among other powerful and influential people. Needless to say, it also usually offers perquisites and enormous pay; such packages may exceed $1 million at large companies. What’s more, compensation for chief executives has been rising faster than for almost any other job in American life, researchers say.

But there are complications that also make the jobs anguishing. By definition, the decisions that land on the chief executive’s desk are the most difficult at the corporation.

The top boss is buffeted by many forces outside his control: government, competitive market forces, Wall Street. Inside the company, the leader may symbolize painful decisions such as laying off workers. And, as Cray concluded, with its administrative duties and demanding constituencies, the job doesn’t offer the freedom of posts that are further down the organizational ladder.

William Ouchi, UCLA professor of management and strategic studies, says the CEO’s single most important job is laying down a long-term strategic plan and risking the corporate resources to make sure the company can carry it out. Should the company sell off parts of its businesses, borrow heavily to buy other operations, adopt new technologies?

“No amount of staff work can come up with a ‘right’ answer to these big questions,” said Ouchi. “The chief executive has got to listen to everybody else’s advice and then, alone, make the right choice.”

Chief executives say these choices are often the most difficult, and rewarding, parts of their jobs.

Robert R. Dockson, the chief executive of California Federal Savings from 1973 to 1985, recalls the wrenching strategic shift he oversaw in the early 1980s. In 1981, with interest rates at 20% and the S&L; carrying a huge portfolio of low-yielding fixed rate mortgages, CalFed lost $51 million.

Two years later Dockson took the company public, raising $400 million and launching a diversification that has increased the company’s assets from $7.5 billion to $26 billion over the course of the decade.

“It puts tremendous strain on a man to have to look ahead, form a long-term plan and then try to stick to it,” said Dockson, 72, who was CalFed chairman until August, 1988. “Board members will ask, ‘Are we going the right way?’ And they should ask.”

Like so many other S&Ls;, CalFed is still in the midst of a difficult adjustment to changes in the industry and government rules. But Dockson considers directing the company’s growth one of the most satisfying parts of the job.

The frustrations that chief executives feel from powerful external forces are illustrated in a dilemma that William Leonhard faced early in his tenure as chief executive of Parsons Co.

After the death of founder Ralph Parsons in 1974, a parade of suitors trooped through Leonhard’s office with offers to buy the big Pasadena engineering company. But none of the offers was nearly what Leonhard thought the company was worth; the cyclic nature of the construction business has kept the stock market from fairly valuing engneering companies, he said.

Rather than sell out, Leonhard helped arrange for an employee trust to buy a 24% stake in 1974. In 1984--after one approach by a hostile bidder--the 8,500 employees bought the remainder.

Private employee ownership has increased employees’ satisfaction, Leonhard believes, and has also eliminated the need to satisfy Wall Street’s pressure for constant improvement in quarterly profits. “The pressure from Wall Street did put a little strain on management,” said Leonhard, who is due to retire in May.

While corporate strivers dream of the chief executive’s power, “once you get into the job, you get preoccupied with the outside pressures that are keeping you from doing what you want,” said James O’Toole, a management professor at USC.

In addition, a gain in power may be accompanied by a loss of freedom. Harry G. Bubb was chief executive of Pacific Mutual Life Insurance from 1986 until the end of last year, during a decade in which the life insurance business underwent sweeping changes in the products it offered and the technology it used.

While Bubb found that overseeing the shift was highly rewarding, he said he sometimes believes the best job he ever had was when he was the 28-year-old supervisor of the company’s regional office in Dallas, charged with producing business in a five-state region.

“I had a maximum degree of freedom, and a minimum of reporting to others,” he recalled. “Maybe I was too young to know how good it was.”

Another source of strain for CEOs is the unrelenting scrutiny of Wall Street analysts, shareholders and the press on their personal performance. Columbia University’s Hambrick recalled how recently a chief executive left his shirttail hanging during a presentation to analysts--and had it written up in an analyst’s report.

“In this job you’ve got to speak your piece without stuttering, or taking a moment to think,” Hambrick said. “And if you don’t show up, they’ll say you’re hiding out.”

Many chief executives consider the task of laying off employees one of the most painful parts of their job.

It’s painful, in part, because employees may blame the CEO personally for the misfortune the corporation has inflicted on them. This attitude was reflected in the film “Roger and Me,” about General Motors Chairman Roger B. Smith and his role in the huge layoffs at GM’s Flint, Mich., plant.

The sacrifice of time at home is another obvious but serious drawback of the job, CEOs say. “I wasn’t on hand at more than one graduation for all of my five kids,” lamented Bubb of Pacific Mutual.

But top executives have learned that such losses go with the territory. Asked if he would limit his working hours if he had it to do over, Leonhard of Parsons responded: “I’m not sure it’s in my nature.”