Posts Tagged ‘celebrity CEOs’

Yesterday I was asked to talk about what I do at Weber Shandwick to our Crisis and Issues group in New York. It was an end of the week get together to take the edge off of all the long hours. I talked about reputational issues and answered several questions. It was a nice opportunity for me to reflect too.

I was asked where all the celebrity CEOs had gone which made me recall my first book on CEO reputation. The book was released at the height of the dot com boom when 22 year old CEOs were the norm and celebrity CEOs were plentiful.  In my book, I tried to make the point that it was not CEO celebrity that mattered but CEO credibility. As I was answering this question, I realized that I hit on some of the right notes as to why CEO celebrity was not the same today but missed a few. In fact, I mentioned that being CEO today was not  an easy job whatsoever. CEOs are much more embattled.  Here are some of the reasons I talked about yesterday but others as well taken from an Economist article I was saving to post about.

• CEO tenure is shorter than it used to be (on average 6.6 years, according to Booz’s research).  They usually come into office with great fanfare. They get approximately two years of grace when they start out (more like 18 months), 2 years to provide evidence that their strategy is working and two years to get pushed out. After six years like this, it’s best to be a CEO nobody.
• CEOs don’t have all the power anymore. Most CEOs now have separate chairmans that are looking over their shoulders and asking a lot of questions.  Booz found that in 2002 48% of incoming CEOs were also chairmen.  In 2009, that number dropped to 12%.  Hard to be a celebrity when there is power sharing going on.
• CEO compensation is always a headline and increasingly links the CEO title to perceptions of greed. CEO compensation is actually declining.
• Shareholders and stakeholders are not sitting idle. They are much more aggressive.  Some hedge funds are actively browbeating CEO and corporate decisions and in executives’ faces. The ridicule can get strenuous.
• Boards are more active too. They don’t want their reputations shamed either by poor CEO decisions or poor behavior. And according to Korn Ferry, new board members are more likely to be deep in international experience and have worked abroad. They are not necessarily golfing buddies like board members of yore. Angry birds maybe, but not necessarily tee time!

With all these barriers in place to curb the power of CEOs, celebrity CEOs can hardly flourish. Instead, we are looking at a new world of convening CEOs who communicate internally to employees, communicate online or through video to netizens, travel to speak to customers and influencers at forums they convene themselves (IBM‘s Smarter Planet  method), partner with third parties and government to problem solve on today’s economic woes and so forth.

Geoff Colvin’s article in Fortune this week was about problems that seem to crop up repeatedly in his interviews.  The one that caught my attention was the complaint he keeps hearing that “My Leader Won’t Lead.” If you have been reading my blog, this is one of my recurring themes. Leaders need to step out of the shadows and speak up. Colvin recommends as part of his Recession Checklist that CEOs “Stand Up and Be Seen.” He says that it’s an easy and powerful way to be effective. He cites the raised profile of Warren Buffett who has helped calm the markets during these tough times.  Colvin remarks that standing up and being seen does not require tons of investment and technological wizardry. I agree wholeheartedly. We’re not talking about celebrating celebrity CEOs, but building back CEO reputations and credibility when perceptions of this office are so low.

This morning I ran across an article in The Economist that went a long way in confirming what I already believe and hopefully outlined in “Resetting CEO Reputation” in the Huffington Post. The Economist describes how our rejection of celebrity CEO types resulted in too many companies full of “faceless” CEOs. I had to laugh out loud at this line: “Watch the parade of chief executives who appear on CNBC every day, or drop in to a high-powered conference, and you begin to wonder whether cloning is more advanced than scientists are letting on.” Pretty clever. The writer then carefully explains why most CEOs are faceless today and who’s to blame them! Everywhere you turn you find board-fired CEOs, public anger about overboard executive compensation and management consultants calling on CEOs to be more humble and Everyman. The Economist warns us: “Yet there is surely a danger of taking all this too far. A low profile is no guarantee against corporate failure… In general, the corporate world needs its flamboyant visionaries and raging egomaniacs rather more than its humble leaders and corporate civil servants. Think of the people who have shaped the modern business landscape, and ‘faceless’ and ‘humble’ are not the first words that come to mind.” A reasonable point. The article advises leaders to be bold, not bland. In another line that hit home, the writer says: “These are people who have created the future, rather than merely managing change, through the force of their personalities and the strength of their visions.” Less managing and more leading.

Essentially, Colvin and the Economist writer are calling for leaders who may be talented guys and gals operationally but who also recognize that they can lead us out of this unprecendented economic downturn by putting a face on their companies and being memorable without being too glitzy. As the article notes at the end, “There is no long-term comparative advantage in being forgettable.” Amen. If the two can be combined and why not, we can have our cake and eat it too.