Posts Tagged ‘CEOs’
A former colleague sent me an engaging article from Gawker about CEOs and hubris. The first half of the article was actually about powerful CEOs sock exposure when their legs were crossed on stage. But the article hit the nail on the head when it comes to CEOs. “A Wall Street CEO primarily serves as the human embodiment of the firm—the competent, reassuring face that the many-tentacled monster projects to the world. As Nassim Nicholas Taleb once said, ‘A C.E.O.’s incentive is not to learn, because he’s not paid on real value. He’s paid on cosmetic value.’ This is not to say that these wildly successful men are dumb; it is simply to say that their job is not about muddling in the details, or tinkering with the gears of the machine. The CEO’s job, in public, is to frame the perception of what his company does, to cast the company’s activities in the proper terms, so that it sits in the public’s mind in an acceptable way.”
I thought that this quote and the part that I bolded sums up well the role of the public CEO — positioning the reputation of the company to its many publics in the most effective way. Of course, I could go on about how important the narrative is and how it should be distributed to maximum effect. But it does go to the central core of the CEO’s external job today. Internally, the CEO’s job is vastly different — modeling the values of the company, inspiring and motivating employees, building a top team, and communicating its mission and purpose. Creating meaning for the workforce and making sense of it all. A massive job.
If you are interested in leadership, you probably read Adam Bryant’s column Corner Office every Sunday in the New York Times. He has just written a book on his more than 200 interviews and in a Wharton interview, he outlines five qualities that stood out in his interviews as making a leader successful:
1. Passion and quality
2. Battle-hardened confidence, the kind that comes from having faced adversity
3. Team smarts (making teams work together)
4. Simplifying mindset (he calls this a simple mindset but that does not explain to me what he really means which is the ability to take the complex and uncertain and distill down to the simplest and easy to understand). He is right about this. I remember a CEO who had 19 message points….it’s got to be pared down to 3 things to focus on. The End.
5. Fearlessness, “….a bias toward action–not recklessness-but a willingness to take risks and to see things that need to be turned upside down or inside out to be improved.” I may have used the word “courage” but fearlessness is similar.
In the interview, there was a mention of a concept that I really like. One of the CEOs told a story about a woman who used the term “middle brain” to explain the balance that executives need between their two halves of the brain (left and right), the creative and analytical. We can use more middle brain executives for sure.
McKinsey is coming out soon with their new research on defining and developing reputation. I was one of the 3,601 executives who responded when they sent questionnaires out in September and I was eagerly awaiting its release. They kindly sent the final report to those who had completed the survey before distributing it more widely. However, in their note to panelists, they mentioned that the report can’t be republished without permission. For that reason, I am not linking to the report results although I bet that public release will come soon in the new year. I do think that I can mention a few of the results that I found most interesting and will add the link when they are made available. Stay tuned.
McKinsey obviously leads the opening paragraph with what they consider the most important findings and that is that many executives do not think their companies’ reputation management strategies are effective. Only one-fifth of executives think their companies manage reputation very effectively. Then they look at reputation management through the lenses of these “effective managers” and report that these companies are more likely to say that reputation management is among the top 3 objectives for their CEOs and that their companies formally track reputation among key stakeholders. It is always interesting how when CEOs focus on something, it becomes company mantra for all. Overall, that is the job of the CEO to focus the organization on what will advance their company’s success.
As I would suspect, two-thirds (64%) expect the scrutiny on their external reputations to be more intense in the years to come. No doubt the belief that there will be increased scutiny on corporate reputation is directly tied to the fairly high percentage (47%) of companies who say they have experienced a reputation threat in the past two to three years. The industries that are above average in having experienced reputation threats are telecom (67%), pharma (60%) and financial (56%). Interestingly, executives in the healthcare sector reported that they were just about average (46%) in having experienced a reputation threat in the past few years but are way above average in what they expectto see in their sector over the next two to three years — 81%.
There are some other findings I will report on when the final report is released. This is just for now. Back again soon. Have a merry Xmas.
Terrific and thoughtful article in Forbes contributed by Giovanni Rodriguez who is the CEO and co-founder of SocialxDesign, a strategy consulting firm. He wrote the article with John Hagel (Deloite Consulting LLP) and Suketu Gandhi (Deloitte LLP). It is about the role of the CEO in a post-digital world. There have been several articles of late about the value of CEOs. I think this question is being raised increasingly often as crises and scandals are bringing our economies to our knees and CEOs are being caught unaware and mystified. Additionally, as the authors point out, CEOs are losing out to the appeal of the leaderless organization such as the Tea Party, Arab Spring and Occupy Movement. People are increasingly asking who needs CEOs when large groups are able to mobilize and effect change without anyone really in charge?
How did this happen in the first place? CEOs used to be the kings of commerce, the chieftains of business. Their reputations were guaranteed. Apparently no longer. The authors explain that CEOs have lost their midas touch because the world they now govern has grown exponentially complex, unrelenting in its pressure, and values short-termism over everything else. They also postulate that leaders can no longer predict when the next Black Swan of unpredictability will rise up and bite them. If they can’t predict the future, what good are they? In reality, who has the time to see beyond the horizon when all that matters is the next quarterly earnings call.
Their solution is of merit. They suggest that we rethink the bully pulpit and recognize that “the CEO as the great communicator – or at least one of the great communicators — is in great demand. What can leaders do to help make sense of their environments? They can harness the power of narrative.” This sure sounded familiar to me in that when I wrote CEO Capital several years ago, I wrote about CEOs as narrators and sense-makers. I wrote, “By motivating employees and instilling the company with a common purpose, the CEO further encourages a sense of community in the pursuit of worthwhile goals.” So I agree wholeheartedly that words, engagement and making sense of it all matter. CEOs can point us in the right direction and give employees a reason for doing. As the authors also say, “Armed with the right narrative, we can safely distinguish between meaningless surface events and what’s really important.” And in this post-digital world, the CEO narrative helps provide stability where instability seems to flourish. Compelling narratives can “motivate people to do awesome things.” They can “set big things in motion” and as the authors say, be “movement makers.”
Definitely an article worth reading and contemplating when someone tells you that CEOs don’t matter.
Every year, we at Weber Shandwick work with executive recruiter Spencer Stuart to survey worldwide CCOs (chief communciations officers) about the challenges and opportunities facing them. The survey is called The Rising CCO. It is a subject that I have always been very interested in. My interest does not stem solely from being in the public relations industry but in the complexity of the communications position today. How a company communications in good times and bad speaks volumes about the management, its values and its attention to the public trust. This year, as in other years, we asked about the impact of social media on CCO positions, what senior managment expects from them, how their effectiveness if measured, the number of board meetings they attend, the qualities needed to be successful, crisis management and a host of others. Here’s one fact for today that has to do with reputation. I will continue to discuss some others that are reputation-related.
We learned from CCOs that improving corporate reputation tops the list of senior management’s expectations for corporate communications this year, as reported by approximately two-thirds of global CCOs (65%). This focus on reputation was followed by obtaining positive media coverage (60%) and increased support of brand reputation/marketing (56%). This prominence for reputation is not surprising given that reputational crisis is practically a fact of life for large companies globally – nearly three-quarters of CCOs (71%) experienced a crisis threatening their reputation in the past two years. I was not surprised either by how important positive media coverage is although I know how difficult that is to secure enough of what will please a CEO. Quantity and quality always matter at the top.
More to come on other interesting feedback from the study.
Just finished reading the new IBM CEO survey, Leading Through Connections. There is alot of great information about how CEOs see the world, particularly the new workforce. Instead of the usual command and control state of affairs, CEOs now realize that they will be building their company reputations on their employee intelligence networks and shared values. As the report says about CEOs, “they are arming the people who represent their brands to the world.” Without knowing what the values, mission and purpose of an organization is, there is little hope that reputations can be steadied and differentiated in the present sea of information chaos and overload. ”For organizations to operate effectively in this environment, employees must internalize and embody the organization’s values and mission.” Companies with the best reputations will have employees who help build and safeguard their companies reputation every minute of every day because they understand what the company stands for. They will guard their company reputation as their own because they will implicitly understand the character of the organization. It is now the CEO’s job to arm them with the tools to understand how best to represent their brands no matter where they are or what time zone they are in. Shared beliefs, up and down the ladder, will create winning cultures and winning companies.
The survey touched a teeny bit on CEOs and social media. Here is what they said. “Though CEOs frequently mentioned dipping their toes into social media waters, few claim to be personally immersed. This arms-length involvement puts CEOs in a precarious position.They are making critical judgements about a disruptive technology without much firsthand knowledge.” A few weeks ago, I had a discussion with a corp communications officer for a major global companywho told me that he knew little about social media and depended totally on a younger guy in his department to handle it. The time is ripe now for CEOs and other company officers to take the leap forward and get to understand social media more deeply. That’s where the future is headed and headed at light-speed. In fact, in the survey, the most startling stat for me was how social media was the least utilized customer interaction method today. Yet, CEOs predict that in three to five years, social media will become one of the top two ways to engage customers. They expect a 256% increase in usage! The number one way to engage in the future was face to face and sales interactions, as it is now. But social media is going to ramp up quickly as the best way to engage with customers and CEOs know it. They just have to get their companies in gear for 2015 when social media reaches its full potential. Unfortunately, the study shows that traditional media will lose out (CEOs predict a 61% decrease in three to five years) as social media gains acceptance.
(The IBM study talks about “future-proof” employees. I borrowed it here for my title. I like the phrase! Also really like the infographic. )
Reputation Institute came out this week with their RepTrak Pulse survey for the US. It measures the reputation of 150 largest US public companies among consumers. In addition to the usual who’s up and who’s down, RI reveals some interesting stats that confirm our research results on Companies Behind the Brand. I was delighted. As RI says in its press release, “Since 2009, U.S. companies have been competing in a new Reputation Economy, where WHO THEY ARE matters even more than WHAT THEY PRODUCE, according to general public sentiment. Framing this in the context of critical consumer behaviors, including purchase consideration, loyalty and recommendation–company or “enterprise” perceptions explain 60% of these behaviors, with product perceptions only accounting for 40%.” This is a big shift which we agree with.
In addition, RI asked Chief Reputation Officers (CEO, CMO and CCO) several questions and learned that 51% name the CEO as the person with the responsibility to set reputation strategy.
Job descriptions for leaders today have to begin including public relations expertise. Just looking at this week’s headlines convinced me that CEOs have to be PR crisis experts to be qualified for the job. I was thinking about this when I read the oped in The New York Times from an investment bank’s employee and hearing the news about the Afghan killings by a U.S. military person. I also just read an indictment by a former Google employee about the oversized focus on advertising since Larry Page took the reins at the search giant. Whereas we used to enumerate the operational excellence of CEOs-to-be, today we should seriously consider whether they are crisis-seasoned enough. Bank CEOs, presidents and Internet champion CEOs have little time to respond when their organizations or countries are making breaking news. I hold my breath waiting for them to respond. Every word is dissected and critiqued. Not easy.
Years ago, I worked on a research project about how pr-savvy board members were. We looked at how many board members in the Fortune 500 had “any” communications experience. Sad to say, there were few. I used to wonder how these board discussions went when no one in the room knew how to deal with detractors. Now I realize that not only do boards need some practiced PR professionals among their board members but CEOs too need to also be PR- tested. Of course, corporate communications officers are there to work alongside CEOs experiencing a crisis but CEOs themselves need to be good at communicating their positions and steadying the troops (so to speak). Tone is sometimes everything.
Here are remarks from the highest offices of the US government in response to the Afghan rampage. Wonder what you think?
“And obviously what happened this weekend was absolutely tragic and heartbreaking. But when you look at what hundreds of thousands of our military personnel have achieved under enormous strain, you can’t help but be proud generally.” — President Obama
“This terrible incident does not change our steadfast dedication to protecting the Afghan people and to doing everything we can to build a strong and stable Afghanistan.” — Secretary of State Hillary Clinton
“Our thoughts and prayers are with the families and their entire community.” — Deputy American ambassador to Afghanistan, James Cunningham.
While I am on the subject of Social CEOs (see my last post), I wanted to mention a study that was released by BRANDfog, a firm that helps executives get social. Survey respondents report that more than 80% of respondents believe that CEOs who engage on social media are better equipped than their peers to lead companies in a Web 2.0 world. What’s more, 93% of respondents believe that CEO engagement on social media helps communicate company values, and grow and evolve corporate leadership in times of crisis. Similarly, 82 percent of survey respondents said they were more likely to trust a company whose CEO and leadership team engage in social media. Since reputation is all about trust, it sounds like the demand is there….we’ve just got to supply it with examples and role models.
CEOs get the importance of corporate responsibility. At the recent Board of Boards CEO Conference in New York where heavyweight CEOs from around the world meet annually, the discussion on doing well by doing good was front and center. In an article on that meeting in Barron’s, the attending author said,
“How the times have changed. Whether investors like it or not, this era’s consumers do care deeply that the products they purchase are both cheap and do no harm to the environment, or, better yet, positively contribute to the state of the world. A full 59% of the queried CEOs felt consumers were “demanding greater levels of transparency regarding their companies’ community engagement initiatives;” 69% claimed such efforts on their part were “rewarded by consumers.”
Because consumers care, investors should care. Fact is, when a company’s cool and progressive spirit—it’s intangible goodwill— is undermined by the firm’s community-damaging business practices, investors often wind up paying the price.”
I was glad that CEOs noted that consumers care because that is what we found in our recent The Company Behind the Brand: In Reputation We Trust. Consumers are no longer passive about the companies that make the products they buy. They care and do not like being surprised if they find that the product they adore is made by a company they detest.
At the meeting, CEOs were asked whether their company’s community and social engagement was “rewarded” by its shareholders and I agree with the author that the response was positive. More than one-half (56%) believe shareholders reward firms for their corporate citizenship. And yes, we all know that it comes down to having the right metrics. It is awfully hard to pin down.
What is most interesting to me over the next 12 months is seeing how Apple’s reputation fares as the Foxconn issue of employee mistreatment stays in the news. I believe that companies get just so many chances to soar above the damaging reputational news and then it reaches the tipping point where it surely matters. I often refer to the BP Effect. BP had three chances to make their reputation right — the Texas City refinery episode, the Alaskan pipeline debacle and then the Gulf of Mexico oil spill. The third one did them in.