Where Does Effective Sales Management End and Micro Management Begin?

The Situation
Scott is a new sales manager. He’s read a bunch of sales management books and articles trying to learn the role. A question that he is struggling with is the right way to manage his team.
The CEO of Scott’s company expects him to be actively involved in every deal that his six salespeople are pursuing. Scott is expected to know what his salespeople are doing every moment of the day.
Having spent ten years in sales, he knows the CEO is off-base with his expectations. But, given that Scott is a new sales manager, he wonders what the best way is to manage his sales team.
Your Challenge
From your perspective, where is the line between effective sales management and micro-management? How should sales managers manage their teams?