Archive for November, 2007
While reading PRWeek this week, I noticed some research from Ketchum Global Research Network that caught my eye. The research among business influentials in 11 countries asked respondents how many would like to be a big company CEO. The research found that 84% of those in India said yes while only 39% in the US said the same.
This finding did not surprise me. Years ago when I did research on this question, the number of rising executives who wanted to be CEO was dwindling at a fast clip. The job is extraordinarily complex, demanding and punishing. Executives right below the CEO have more control over their lives and livelihood than CEOs today. It’s interesting that respondents in India find the CEO position attractive. Perhaps the prominence of family businesses in India accounts for this overall positive perception. Additionally, CEO turnover in India does not seem as bad as it is in the U.S. and Europe.
The CEO position today is not for the faint of heart. Not sure we need research to tell us that anymore.
An article in today’s paper commented on Hillary Clinton’s reputation for the “responsibility gene.” I think that if she was going to have any special reputational DNA, that’s a good one to have. The writer was referring to her caution over what she says now as a candidate and what she will actually do if elected President. Hillary wants to make sure that she cannot be accused of changing her tune if elected. My sense is that if I was going to inherit anything, responsibility would be a good one to have been passed down through generations and should serve as a healthy structure for presidential success. We will soon seen how gene-ability favors her reputation in the primaries pretty soon.
Returned back home from my trip overseas in time for Thanksgiving. It is always reassuring to witness how the topic of reputation is so relevant no matter what part of the world you are in. Of course, did some reading on the plane back and found some good quotes and items of interest to share.
This one from Howard Stringer, CEO of Sony, in BusinessWeek about what he plans to do after his gig at Sony ends. Stringer says: ”God, sink giggling into the sea, I think. I have no interest in being a CEO again if I survive this intact, which in itself will be something of a miracle.” Stringer is right about making it to the end of his tenure. CEO lifespans are getting shorter and turnover higher. We at Weber Shandwick will be releasing an update on our CEO Departures study next week and CEOs of the world’s largest companies are departing approximately every 5 days. Good news for Stringer however. I think that since he has made it thus far, he might see it to the end which on average is 4-5 years.
Stanford University, McKinsey and LSE’s Center for Economic Performance ranked 12 countries on their management practices. Overall, US companies are the best managed followed by Germany, Japan and Sweden. Not bad for being recognized as having a good country reputation for well-managed corporations. The worst managed country awards go to India and Greece. The UK is in the middle of the continuum with its neighbors’ France and Italy.
On other management variables, best people management (performance and merit-based) goes to the US, UK and India. The best operational management kudos (continuous improvement and shopfloor operations) go to Japan, Germany, France, Italy and Sweden. Family run companies have the worst reputations for management (apparently this brought down UK scores since they are in abundance there). Interestingly too is that nearly 9 out of 10 managers report that their companies are better managed than average. The researchers politely conclude that managers need to get a better handle on their firm’s true management abilities. They are too optimistic!
Happy thanksgiving wherever you are!
I just was handed a wonderful report from AON on risk management. The survey is among 320 respondent organizations that have revenues of nearly $1 billion or more across many sectors and all regions of the globe. The findings are astounding as to what it says about reputation. Global business executives were asked about the top 10 risks they see today. Here they are in rank order:
|Damage to reputation|
|Third party liability|
|Distribution or supply chain failure|
|Failure to attract or retain staff|
|Market risk (financial)|
|Merger/acquisition/restructuring Failure of disaster recovery plan|
Reputation damage reigns at the top. As the AON report says, “Damage to reputation is an enterprise -wide event that can lead to negative publicity, a decline in market share and the inability to recruit and retain top talent.” And that’s only half of it. Companies with eroding reputation lose customers, investors, easy access to new markets, ability to charge a premium, goodwill from the community, benefit of the doubt in time of crisis, and the list goes on.
Even more remarkable, reputation damage is the greatest threat no matter what region of the world. The Global Risk Management Survey also found that few companies are prepared for reputation damage.
AON, thanks for this report. I can use these findings in many places for my talks and writings. It is nice to have what I believe so strongly be confirmed.
Found a memorable quote that appeared in The New York Times at the same time I read the article on the next generation of CEOs (posted yesterday). The article was about how lessons from Shakespeare can prove invaluable for leaders today. There’s even a nice quote from JPMorgan Chase’s CEO Jamie Dimon about the insights provided by Mr. Shakespeare.
A few years ago, I attended a Wharton Leadership Forum in Philadelphia and Ken Adelman re-enacted scenes from Shakespeare. He and his wife regularly teach Shakespearean lessons to executives through their smartly named company Movers and Shakespeares. I was so impressed that I never forgot how impressed I was with King Lear’s insights into power and duplicity.
The article also had a quote from a Shakespearean actor that resonated with me. “CEOs are the modern kings and queens of the global world,” said Kevin Coleman. The continuing interest in CEOs remains steadfast for just this reason. CEOs are the world’s royalty. He said it better.
Just read another wonderful survey from McKinsey & Co. They released their most recent survey on societal issues according to C-level executives. It was nice to see that environmental concerns are at the top of most agendas worldwide. A few tidbits caught my eye:
* Executives understand that good corporate responsibility helps to earn the public’s trust.
* Although McKinsey takes a negative view of public relations, it is the tactic used most frequently and believed to be most effective out of 13 tactics relied on most frequently by senior respondents in the world’s largest companies.
* The single most effective action in building reputation is believed to be making business practices transparent.
Thought I should share the last point since McKinsey had this as a separate question which says how important it is in the first place.
The New York Times today has a front page article in the business section today on the next wave of CEOs. The article “C.E.O. Evolution Phase 3″ was apparently written as a direct result of recent high profile CEO departures at major financial services companies suffering huge losses from the subprime mortgage fallout. The article’s sub-title was “After Empire Builders and Repair Experts, the Team Captain.”
I can’t help but think that this story has already been written. There seems to have been a general theme in the news media that we went from celebrity CEOs and empire builders to post-Enron custodial turnaround CEOs. Don’t get me wrong but the Team Captain is not a new leadership theme. Our research at Weber Shandwick on Safeguarding Reputation and the research I have been conducting on CEOs for years has always found that bench strength is critical to building CEO and company reputations. I am now going to wait for the next article in the top-tier media on the Eco-CEO such as GE’s Immelt and others. It cannot be far away.
Since I do collect CEO quotes, there were a few that I highlighted to put on our reputationRX site:
“It’s someone who can assemble a team that functions as smoothly as a jazz sextet.” (USC‘s Warren Bennis)
“The academic research says if you want to predict what the future financial performance over the next one to three years will be, you need to know the top team.” (Wharton‘s Michael Useem)
There are so many variations on explaining the next generation of CEOs…what happened to the Tech CEO or the Consensus CEO. Is there room for an Organic CEO or Shy CEO or Spiritual CEO? What about the Safety CEO? In light of recent product recalls, privacy issues and environmental disasters, can the Safety CEO be far from view? I don’ think so. I can even name a few.
Some research has shown that people believe gossip, rumor and innuendo even if they are confronted with hard evidence refuting it. Research conducted at the Max Planck Institute described in The New York Times and later mentioned in The Week (great to read) told about researchers who set up a situation where players who were playing a philantrophy game gave other players money based on a recipient’s rumored reputation. When the players were told that a recipient was generous and friendly to other players, they were much more likely to give money to that person. In contrast, when they were told that the recipient was greedy and unfriendly, players were less likely to give that person money. BUT this pattern remained the same even when people were shown written documents saying that the greedy person was actually quite generous and the generous person was actually Scrooge-like. Gossip and reputation-ruining information is obviously very sticky and trumps rational data. A lesson to be learned. Watch your reputation since bad news is hard to erase, regardless of how much support you have saying you are being unfairly treated.