Posts Tagged ‘CEO’

In an interview with the CEO of Google, Eric Schmidt opines on the future of search. He makes an interesting predicition in the wide-ranging interview. Schmidt says: “…apparently seriously, that every young person one day will be entitled automatically to change his or her name on reaching adulthood in order to disown youthful hijinks stored on their friends’ social media sites.”

This notion of name-change raises interesting questions about reputation if we can disown our youthful indiscretions and misguided ways from the past.  If reputation can be altered or amended at the magic age of 18 or 21, how authentic can reputation really be? I wonder if the younger people he is talking about are now more careful about their actions, relationships and words because they know deep down that we are all indexed somewhere. To give younger people a digital eraser as they enter adulthood might just keep them (not all) from properly shaping their moral character and understanding that there are consequences to what they do.

Of course, I would very much like to think that everyone gets one free pass sometime in life and could opt to wipe out one past error or misstep but I think that given the choice, it would be agony to pick just one! Also, there seems to be an entire business devoted to burying those misdeeds so not sure changing one’s name is necessary.

  Author and columnist Thomas Friedman wrote today: “In this kind of world, leadership at every level of government and business matters more than ever. We have no margin of error anymore, no time for politics as usual or suboptimal legislation.”  Leadership matters is one of the cornerstones of great company reputations. There is no getting around it. The destiny of the CEO is inextricably linked to the company’s reputation. If you have ever worked with a CEO who was not the right fit for the company and who worried about themselves more than the company, you know the damage that the wrong CEO can do. It is almost better to work for a so-so or good, not great, CEO than the wrong one.

Also in today’s New York Times’ business section is some advice from the CEO of The Calvert Group, Barbara Krumsiek . She was asked for her best advice to executives starting out.  She said to ask each executive on your leadership team the following question,  “Tell me about your job, but now tell me about what you think you do here that is not in that job description that you think is really critical.”  Good starting out question but I actually like the second question better, “Tell me one thing that’s going on at Calvert that you think I don’t know that you think I should know.”

The best advice for CEO newcomers is that there is no such thing as a stupid question. One CEO told me that. You get about 3 or 4 months to ask those “stupid” questions.

Getting back to the importance of leadership, we don’t need Thomas Friedman or even me to relay this important news about what drives the global economy and business today — good leaders. Every day we get examples of the impact of good and bad leadership. Unfortunately there are so many examples of bad leadership decisions that we forget to notice the daily good deeds of many company CEOs.  Is too bad. The margin of error might actually be wider than we think.

 My journeys in Europe continued all week although I am now safely home and enjoying the first warm weather of the past two weeks. One thing that struck me in retrospect was that there was no market that did not talk about recession-weariness. Everyone mentioned how tough times had been with the global recession and might be getting worse as Greece faced its debt crisis, the EU bails out several members and the Euro was dropping. My presentation on The New Normal was perfectly timed.

• In Amsterdam I learned that some companies were rising to the challenge of the recession. Dutch airline Martinair had offered a similar program to Hyundai Assurance in the US where people who booked transatlantic flights could cancel their flight without cancellation fees if someone lost their job. It is called Boek Gerust Verzeking or worry-free booking insurance.  As well, the CEO of KLM, Peter Hartman, was applauded for going on YouTube to sympathize and apologize about the flight cancellations caused by the volcanic ash a few weeks earlier. A perfect example of CEOs resetting their reputations.  In addition, several people in our panel discussion mentioned the book The Truth about Ikea when we discussed this new  “tell all” and “see thru” world that has emerged. I also learned about an online site where you can “couch surf” or find a couch to crash on in another city so you can save some money. Smart alternative to paying for a hotel if your finances are strained. The Dutch also have a group buying site —  ichoosr.com – and their CEO had joined our panel to discuss the site’s success in this new age of austerity or what we were calling the New Normal.
• In Paris, at our luncheon discussion, one of the guests mentioned that they were moving their communications and marketing back to print since they were not convinced that the ROI online was working as well as they would have liked. Also had my first experience in Paris being interviewed in-person by bloggers. Turned out to be quite a lot of fun. This fits into my prediction that face-to-face communications will be back as a new channel for communicating.
• London was fascinating because I arrived the evening when the new coalition government was announced. The first day of the “new politics” or “plural politics” was brisk and spring –like, the perfect day for a new beginning. In our breakfast seminar, it was hard not to discuss what the new governance model in Great Britain meant but one idea I had was that the future would undoubtedly include more coalitions in business partnering over the next few years. Additionally, I thought that the outcome of the election was indicative of the new normal in that there were no winners and losers (except Gordon Brown) but something in-between. Not black or white, but just grey all the time.
• I could have sworn that Heathrow airport in London is scented. I could not believe my nose! There was a great scent in the air and although I can not find an article on why it smelled so therapeutic (aromatherapy), I think it might just be the air from the spa facilities inside. It is a great idea if it is true.
• Madrid had just heard their Prime Minister Zapatero talking about civil service workers’ salaries being frozen, pensions cut and other budget-minded recourses when I arrived. Like other cities, people instinctively knew that frugality was back with a vengeance. I had read in the paper before I arrived  that Zapatero had said it was the toughest speech he ever gave. I considered that quite humble although I doubt most Spaniards felt the same way upon hearing the news. In the world of reputation, leaders get all the credit when things go right and all the blame (and then some) when things go wrong. An interesting experience during my media interviews was that each journalist asked me what I thought the future of journalism was.  I think this happened everywhere I went when journalists took the floor. The reputation of journalism is sure taking a hit in this new digital world. I recall in Brussels how a journalist said that online was killing them off one by one. Is a global phenomenon and one I have a lot of sympathy for.

Now that I am back on solid ground for a few days and not spending my days and nights in airports and hotels, I can more easily get back to posting more regularly about reputation matters.  However, reputation is everywhere. Danny Rogers, the editor of PRWeek in London wisely pointed to the frequent mentions of the word “reputation” in media coverage. It was not always like that.  It is unavoidable these days.

I had a great time with my colleagues at Weber Shandwick and meeting clients and journalists, bloggers,  among others. Mind-expanding is good for the soul.

Some reputations rebound. Today’s New York Times describes how Starbucks’ reputation is bouncing back. One of the drivers of that recovery came from its CEO ceding control to employees. In Seattle, employees held brainstorms that surfaced ideas to turn the ailing company around once CEO Howard Schultz told them to just do it! — break the rules and figure it out for yourselves. You have permission. Schultz gave the okay but employees took it on. As the article says, founder Schultz was determined to give its coffee chain “ a dose of the urgency, nimbleness and risk-taking of a start-up company.” Employees took on the risk of failing and the hunger to win. Not easy to do in a tough economic environment like this. What happened? A new Starbucks-owned coffeehouse arose that doesn’t resemble the typical mass produced furniture Starbucks look. Instead it heralds back to the coffeehouses of yore with its own local flavor and style.  I like the big communal table with sockets in the center. The coffeehouse described in the article is 15th Avenue Coffee and Tea and sells microbrew beers, espressos, cheese and baguettes.  A turnaround takes more than baguettes but is clearly in the works.

Good to hear that Schultz is listening to employees and customers who are helping to oil the turnaround gears. As we know, turnarounds take some time so we’ll be hearing more as time goes by.

Marketing News’ (not available except by subscription) recent publication on Obama as Marketer-in-Chief contained evaluations by experts including Weber Shandwick’s CEO Harris Diamond. Harris made an important point that jumped out at me. He said that “The reason that you can’t underestimate Barack Obama is we’ve had very few presidents who’ve had the ability to make us listen.”  Sometimes when thought leadership platforms or speaking opportunities are identified for CEOs and other top executives, we lose sight of the fact that being visible is well and good but that CEOs need to really make us want to listen to what they have to say. It is not just nabbing the panel or keynote opportunity but making sure that the CEO truly says something memorable, important and tied to our collective future. I agree with Harris that Obama makes us want to listen, regardless of your political persuasion. Perhaps that is also why I regularly read Vital Speeches of the Day.

Despite BP’s downfall and ouster of Sir John Browne, he made you want to listen to what he had to say about global warming and carbon footprints. Thought it was worth reminding myself as well as others that Harris is right, that reputation-building today is built on no less than saying something that we want to hear.

    UBS’ CEO Oswald Grubel issued this statement to all employees on Tuesday September 8th. It appeared in the Wall Street Journal. As Grubel works hard to repair UBS’ reputation after the many challenges facing the bank, he provided this communications update on the positive signs ahead.  As I bolded below, Grubel candidly points to the bank’s damaged reputation and the fact that it will only be restored when when the organization accomplishs what it sets out to do. He smartly remarks that no aggressive media headlines nor advertising campaign is going to change perceptions overnight. What will make the difference, according to Grubel,  is trained people at every level, a focus on the business and a commitment to doing the right thing. Grubel’s assessment is right — it takes hard work and relentless effort to restore reputation and it takes more time than anyone imagines. According to Weber Shandwick’s recovery research, it takes approximately 3.5 years to recover from reputation loss. Unfortunately, most CEOs are on their way out of office when the reputation recovery process is nearly complete.

I thought it was helpful for the CEO to point out to employees that internal reality on achievements are not readily seen from the outside. External stakeholder perceptions take time to catch up with reality. This single factor is one of the more frustrating elements about recovering reputation, particulalry for CEOs. Too often CEOs take the lack of acknowledgement about turnaround signs as a personal affront when in fact, rebuilding trust takes many many incremental steps to regain that trust.

From the looks of Grubel ‘s letter, he appears to get it.

Dear colleagues,

Since I last wrote you, we have accomplished a great deal and have had several positive things to report.

In the second quarter, we reported an operating profit for the first time in eight quarters. In addition, we have strengthened our capital position and further reduced our risks. The market too has shown more confidence in us.

We have also consolidated the initiatives determining our firm’s new positioning in a turnaround program, and we are on track with the program to increase overall efficiency. The unpleasant side of it, the job cuts, is almost complete, and most of the employees have been informed.

The creation of a comprehensive Corporate Center is well advanced. The teams in the areas of Finance, Risk and Communications & Branding have been brought together, and the remaining functions will take this step in the next quarter.

In connection with the summons of the US tax authorities, a settlement agreement acceptable to all parties was reached. What’s crucial about it is that the agreed solution lies within the framework of the existing Swiss legal system. Implementing the settlement will continue to occupy the bank for some time yet, but the fog of uncertainty that the summons created has lifted.

Finally, the Swiss government sold its stake in UBS through a placement with institutional investors and realized a healthy profit from it. This closed another important chapter in our recent history.

How should we assess these events? Our transformation is proceeding according to plan. But we must recognize that none of these steps free us overnight from all the challenges we face. We must change and keep changing in an ongoing, sustainable way.

To do so, we need to get the basics right. We must abide by all laws everywhere and have clear responsibilities. You are the key here. You are the specialist in your field, the one who knows best what has to be changed. But most of all you are the point of contact with our clients. Right now, at the point when we’ve put some of our biggest problems behind us, is the time for us to serve our clients even more attentively.

One thing must be clear: our results have indeed improved and certain progress has been recognized, but our reputation is still damaged. Primarily the situation with the US has left our clients with a bitter taste in their mouths, and it is now up to us to show them that we are a trustworthy bank with trustworthy employees. There is nothing more important, and I count on your active engagement in winning their trust back step by step.

It is important that we do not point fingers at each other, but that we grow closer together across divisional and national boundaries. Only then will UBS be a truly integrated organization that can achieve its fullest potential. This integration cannot only be centrally designed; it must be truly lived everywhere we are operating. Our regional CEOs are responsible for making the total expertise of UBS available to our clients, and we must do everything possible to support them.

Returning the group to profitability will only be the beginning. The recovery of our reputation will require hard work and relentless effort. But I am confident that we have the fundamentals and the right people in place. Essentially, it’s about one thing: we must do everything better than our competitors.

To do that, we will support you with the “UBS Business University” currently being developed. I am confident that the success of a bank in the future will be, more than ever, dependent on having the most competent people at all levels. At UBS, we want to be diligent in pursuing this goal. I am excited about our new university, which will help us put our strategy into practice.

To conclude, I want to again touch on the topic of communications and the media. Along the path to success, we will have to deal with a skeptical public. Achievements will be apparent to us in the bank long before they will be recognized by the outside world. We will not be able to accelerate this process through advertising campaigns, public promises and aggressive media work. Our clients have read enough headlines about us. If we want to convince the public, we must, first and foremost, provide evidence of our accomplishments again and again, and this takes time.

I would like to thank you again for your replies and encourage you to use the recently launched TurnAround Platform to comment on UBS’s most recent developments.

Yours,

Oswald J. Grübel

  Usually when I write about what CEOs should do in their first 100 days, the listening tour pops up. CEOs are advised to travel to facilities and ask employees and customers what’s on their minds, what the company could be doing better or not doing at all, what they wish the CEO would do or not do, and where they think the business is headed in general. Even “insider” CEOs who have been with the company for three or more years need to go on listening tours. People will tell CEOs things they would never tell anyone else. I always recall how Xerox’s former CEO Ann Mulcahy went on a listening tour when she was first named CEO although she had been with the company for 25 years. She quickly sent a message that there was plenty for her to learn.

So I chuckled to myself when I read a recent article about Governor Sanford — the one who had the affair with the Argentine woman while conveniently telling everyone that was hiking and unreachable.  The Governor is now going on a “forgiveness” tour around the state of South Carolina asking for repentance for his sins. Despite having written a book on reputation recovery, I guess that this is one kind of recovery tactic that I had not thought of.  Most people in public relations would advise someone in the Governor’s situation to get the bad news out all at once and put an end to it at once.  But the Governor continues to extend his front page scandal beyond the pale of reality. I kept waiting to hear that he has started a “forgiveness blog.”

I tried to think of other red-faced CEOs or politicians who went on forgiveness tours and none leaped to mind. Former NY governor Eliott Spitzer had the wisdom to stay out of the spotlight and slowly emerge one year later  to redeem his reputation. I have always contended that he will manage to redeem himself over the long term. Michael Miliken redeemed his reputation by participating in very worthwhile and noble deeds but not with a forgiveness tour. Enron’s Ken Lay and Jeffrey Skilling never went on a forgiveness tour although they had time before their trials began. They must have crossed the idea off their lists.

The idea of a forgiveness tour might be one and the same with a listening tour because Governor Sanford’s constituents probably have alot of advice to give him on the topic of marital infidelity. I just hope he listens carefully while asking for atonement.

  An article I read in today’s Wall Street Journal  left me shaking my head in disbelief. I read the article right before I gave a presentation to a communications team on the new rules and metrics on reputation today.  Since I could not comprehend how something like this could happen, I blurted it out when I met the head of the communications department prior to the start of the meeting.  I still cannot assimilate it so I am hoping that sharing this news will help me get back to work. The article is about attacks on the home of Swiss pharma company Novartis’ CEO allegedly by animal rights activists. The story is that activists have been targeting Novartis to discontinue animal testing of drugs, something that Novartis says they have taken “strong steps” to reduce. What is so terribly alarming is that the suspected attackers stole the ashes of CEO Daniel Vasella’s mother from her grave. This is in addition to a suspicious fire at his summer home in Austria this week.  All I can say is that there are some rules that no one or no organization should break. Stealing a loved one’s ashes or consecrating a grave is immoral. Everyone, including activists who feel strongly about a topic, should follow a moral code by which they live and communicate with others. Violence of this type ultimately harms the reputation of all activists.

   The Financial Times columnist Stefan Stern wrote an article about a CEO who went undercover for two weeks before he was announced as the new chief executive. He pretended to be an office worker who was sent around to several locations. During these two weeks, he was being filmed for what his co-workers thought was a documentary on how office types cope with hard labor assignments.  In truth, the film they were producing was part of a new series called Undercover Boss to be shown in the U.K. It is coming to the US next fall.  What was fascinating about the undercover CEO’s two weeks was that he overheard the real conversations that employees exchanged about their company and its reputation.  When asked what his greatest learning was, the undercover CEO said, “Our key messages were not just getting through to people. People working a shift on a large site do not have time to read newsletters or log on to websites. You have to communicate with people on their terms, and it is different for every location. One size does not fit all.”  The critical lesson learned was that all the finely crafted messages from the top are often not received or are totally misunderstood. The new CEO realized that when he was officially instated as CEO, he had to over-communicate, especially in bad times like these.  Reputations cannot be built internally without reaching employees on the front lines or end lines.

Some advice was given in the article about what works best besides over-communications when it comes to getting messages heard. They are quite clear…keep it simple, break it down into easy pieces what you are asking employees to do and show empathy. Good reputation-builders.