Great CEO Offsite Idea

McKinsey just issued an interview with Pieter Nota who runs Philips' Consumer Lifestyle sector. The article was about his first 100 days at Philips and how he turned around the unit. In the interview, the author provided insights into Nota's off-sites for his senior team and how they incorporated "courageous conversations" where team members got their gripes out on the table and then collectively resolved the conflicts constructively. Or as the article says, turned the negative energy into positive energy. 

But the lesson learned was an exercise that Nota built into a second off-site a few years into his tenure which I think could work well at senior management off sites that new CEOs often hold. The off-site started off with lots of blue sky collaboration on where the future of their business could possibly go. And here's the kicker that just entranced me because it's such a good idea. The day ended with a brainstorm on "the ten excuses we could use two years from now for not having made the aspiration a reality." The team addressed each excuse head on and committed themselves to not using the excuses to explain away why they did not turn their dreams into reality down the road. A great exercise for many of us. I can already think of excuses that I use as to why I can't do one thing or another. And applying it to teams is just brilliant to create greater ownership. 

I am going to add this Top 10 Excuses brainstorming idea to any counsel I give.


Quotes for the Day

I found this article in my Google alert and thought it was very well written and thoughtful on the topic of reputation. Hard to find thoughtful pieces these days when everyone is in a mad rush. Just yesterday at lunch I was talking to several others about content fatigue which seems to be the malady of the season. Below is a good description of reputation from the author of the article, Bong Osorio. I recall someone, perhaps Warren Buffett, saying something similar about trust, "Trust is like the air you breathe. When it's present, nobody really notices. But when it's absent, everybody notices." Quote below:

"Reputation is like the weather. It exists, irrespective of whether you measure its effects. It dictates what activities and goals are realistic, and how you should package and present yourself to be believable, strong and supportable. It is prudent to check the weather before you go out, and even more helpful if you know how it is changing. So it is with reputation. The main disparity between the two is that while you cannot control the weather, you can design the course of your reputation. And that is a clear case for managing it."

Crisis Looking Backwards

Interesting interview on CNN with CDC (Centers for Disease Control) Director Dr. Thomas Frieden on the Ebola crisis.  Revealing quote from him which applies to every leader who has faced these type of challenges:

"I wish I had know then what we know now. But that's not how the world works. We live life forwards and we understand it backwards. Looking back with 20/20 hindsight, there are always things we would do differently."

Holiday reputation of retailers needs protecting

Some new research just came out from Toluna Research for about consumer perceptions of big and small retailers this holiday season. Because of the recent spate of big retailer security breaches, consumers are expressing great concern. 

  • 69% are concerned about security when shopping online this season
  • 25% are likely to change their online shopping behavior
  • twice as many consumers (27% vs. 12%, respectively) are concerned about online security at large retailers than small retailers

The big box retailers' reputations will clearly feel the heat this season if consumers are concerned about their security privacy. To keep their reputations intact, they will need to reassure consumers that their credit history and information is iron-clad. Communications will be key to getting shoppers back into the stores and online with confidence. Information about what they are doing to protect consumers, such as special chips in their cards, and beefed up security technology can help. Additionally, communicating from the CEO on down about consumer concerns and acknowledgement that they are aware of a confidence gap in shopping would be beneficial. Having the senior executive team visibly active during the holiday season at the stores or online using social media might send the right message that they are on alert. Perhaps having senior executives shop in the stores for their holiday gifts and video-ing the transactions could help send a "trust" message. Training all employees about how to answer shoppers' questions about cyber breaches is important. In addition, employees need to know that they should not give out their passwords under any circumstances and the same with vendors since this is such a high security risk and easy way to get into retailer systems. One of the things I learned when working on our Employees Rising study was that one of the reasons that companies train their employees in the use of social media is to educate them about not giving out passwords because it only enables cyber thiefs to do ill.

Reputation is everyone's job during the holiday season and making that loud and clear this year will help. Let's wish for a non-cyber-hacking holiday in 2014.

First 100 Days

Just finished an article in Fortune about Frank Blake, former CEO of Home Depot. It is one of those pieces that take the full breadth of a CEO's impact on the company and his legacy. The article was particularly interesting because the question in the article title -- How Home Depot CEO Frank Blake Kept his Legacy from Being Hacked -- refers to the impact of the massive data breach of Home Depot customers and its impact on Blake's well regarded reputation pulling the retailer back from the abyss. 

Since I am an observer of CEOs' First 100 Days, I wanted to record a few things he did from the start of his tenure. Blake laid out his strategy on Day One -- that the focus would be on customers and employees and there would be plenty of listening all around. He never veered from this. After his first broadcast on Day One, he followed up less than one week later with a second broadcast describing his leadership model which was an inverted pyramid with front line employees at the top and management at the bottom. As Blake says, his job was to "clear away the things that get in your way" and make the hard and necessary decisions to grow the business for the future. This included selling off acquisitions, focusing incentives on servicing customers and getting his management team to speak up if things were not going right. Blake is quoted in the article as saying, "How do you make people comfortable enough to tell you what they don't want to tell you?" The interview with Blake makes it clear that his quiet, unassuming manner and his listening antennae helped fuel his success. He walked the aisles in the stores and focused intensely on solving customers' problems. As he said from the start, the front line employee who interacts with the customers is where the power lies. 

Focusing Externally

This week I attended a dinner at the Institute of Public Relations. It was the Annual Distinguished Lecture & Awards Dinner and the key note speaker was Richard Dobbs, Director of the McKinsey Global Institute who spoke about “Prevailing Business Drivers: Digitization, Urbanization, Easternization.” He spoke about the four forces that were going to affect management in the next half-century -- urbanization, aging, technology and connectivity. In fact, he wrote about these forces in an article I read a couple of weeks ago which should be read by all to understand the future. He also has a book coming out called No Ordinary Disruption.

However, at the dinner, he touched on leadership in a way he did not in the article. He said he and others at McKinsey had identified the qualities of winning leaders of the future -- agility, optimism and a focus on the external. Dobbs said that leaders needed to focus more on the external and understand how the world was changing. It was their job to bring those insights back to their companies. He also said that leaders need to tell their stories externally and be good at it. That was music to my ears because I believe the same. There is no better time to story tell than now as the channels proliferate and leaders become more comfortable with the platforms. The corporate landscape has changed immeasurably and leaders need to fiercely narrate their company's differentiation and purpose. No one is going to hear them if they do not speak out on behalf of their companies. Too many companies appear the same. Something must be done and who is better able to get heard than the CEO. Here's to the future!