ReputationXchange http://www.reputationxchange.com CEO & Corporate Reputation Sun, 17 Jul 2016 18:44:24 +0000 en-US hourly 1 http://wordpress.org/?v=4.2.9 The moral kickback to CEO activismhttp://www.reputationxchange.com/the-moral-kickback-to-ceo-activism/ http://www.reputationxchange.com/the-moral-kickback-to-ceo-activism/#comments Sun, 17 Jul 2016 18:44:24 +0000 http://www.reputationxchange.com/?p=18430 As you can tell, I’ve been supremely interested in CEO activism of late. Obviously, I would be since we launched research on the topic and it seems to have struck a chord. Happily, a friend of mine who is an independent consultant with a deep business...

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As you can tell, I’ve been supremely interested in CEO activism of late. Obviously, I would be since we launched research on the topic and it seems to have struck a chord. Happily, a friend of mine who is an independent consultant with a deep business background, Ann Graham, sent me a link to a post she wrote on CEO activism that I had not read. I am glad she did. Her post provided additional insight into the moral implications of CEO activism, a critical component indeed that needs mentioning.

Ann quotes David Mayer, a professor at the University of Michigan business school, who studies how people respond to leaders who behave within the moral domain. She writes: “One study (Mayer et al. 2014) examined how ethical leadership can effect how individuals conceive and mentally approach ethical decisions. They found that ethical leadership decreases employees’ moral detachment or ‘moral disengagement’ (the term used in sociology) that leads to unethical decision-making.” If you see or hear your CEO or manager behaving or communicating within moral bounds, it is memorable, lasting and increases your own likelihood of acting with equal integrity. That is the return on speaking up for what you believe in.

As our research showed, the average person does not realize that CEOs are speaking out from a moral authority they feel when they speak up on societal issues related or unrelated to their core business. The average person thinks this act of speaking up is more often tied to media coverage than moral courage. It stands to reason that if your CEO or manager speaks up because he or she believes that some injustice has been done and they want to right the issue on behalf of those less able to speak up or for their employees, it is hard not to apply that ethical stance to your own day-to-day. Integrity can become a habit.

Thanks Ann for pointing this out.

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Finding the Words — CEO Activismhttp://www.reputationxchange.com/finding-the-words-ceo-activism/ http://www.reputationxchange.com/finding-the-words-ceo-activism/#comments Sat, 09 Jul 2016 23:57:59 +0000 http://www.reputationxchange.com/?p=18418 Our research on CEO activism came out a few weeks ago. It was covered in this article in the Washington Post by Jena McGregor. Then came this week’s horrific news of shootings in Baton Rouge, St. Paul and Dallas which upended our lives and sense of security. In...

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Our research on CEO activism came out a few weeks ago. It was covered in this article in the Washington Post by Jena McGregor. Then came this week’s horrific news of shootings in Baton Rouge, St. Paul and Dallas which upended our lives and sense of security. In response, a few CEOs spoke out (Mark Zuckerberg, Tim Cook, Marc Benioff) and McGregor penned another article that is worth reading if you are interested in the phenomenon of CEO activism –“Gun brutality emboldens CEOs to speak out about race.”

McGregor spoke with Tom Andrews of SYPartners who responded to McGregor’s question about why fewer CEOs have spoken up in response to the escalating racial tensions brought on by this week’s events compared to the events surrounding anti-LGBT laws in several states over the past 18 months or so. Andrews said: “We have a language for the LGBT community — there’s been such a movement around creating that language you can trace right back to the [gay rights advocacy group] Human Rights Campaign. A lot of CEOs feel so awkward about race diversity and how to address it. They can’t go there. They don’t have a language for it.” I thought this was an interesting perspective and very likely true. However, as I thought about it more, one or two of the tech CEOs who did speak up this week in reaction to the shootings of individuals and the police quoted Martin Luther King Jr. or U.S. Representative of Georgia John Lewis.  So perhaps there already are words to use if we just look hard enough?

In our guidelines for contemplating CEO activism, we recommended that CEOs who do speak up on hot-button social issues need to be prepared for the next flare up.  Once a CEO takes a stand on behalf of his or her company, employees will expect them to show up on a more public stage when human rights are being violated or other contentious issues are in the public eye.

I do expect to see CEO activism to catch fire in the months ahead. We will be watching closely.

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The reputation of business needs repairhttp://www.reputationxchange.com/the-reputation-of-business-needs-repair/ http://www.reputationxchange.com/the-reputation-of-business-needs-repair/#comments Sat, 02 Jul 2016 20:17:21 +0000 http://www.reputationxchange.com/?p=18403 Without a doubt, the reputation of business is getting hammered. The upcoming political conventions will have their pitchforks out in this increasingly anti-business, anti-Wall Street environment. It should only grow worse. Right now business is seen as greedy, dishonest, arrogant and for most Americans, as having stacked...

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Without a doubt, the reputation of business is getting hammered. The upcoming political conventions will have their pitchforks out in this increasingly anti-business, anti-Wall Street environment. It should only grow worse. Right now business is seen as greedy, dishonest, arrogant and for most Americans, as having stacked the deck against the average citizen with job outsourcing and tax loopholes that benefit the rich.

This anti-business, populist sentiment has been on my mind of late. I was invited to be a subject expert at the WSJ CFO Network annual meeting on what business can do to improve its reputation. At first, I thought that should not be too hard to propose how business can be a source for good. But the more I looked into what I should say for my opening remarks, the harder it was to come up with recommendations to change the public’s current opinion. Business is red meat for politicians and it is only becoming rawer.

The painful truth is that no one is speaking up on behalf of business or has a convincing argument that might reinforce the benefits that business brings.  No one is telling the story of businesses’ contributions to economic growth, job creation, social responsibility and employee safety and well being. The discussion on business reputation was off the record but here are the recommendations from the break-out session.

Ultimately, the challenge is showing that business cares. It is not just about the facts and the figures because that has been drowned out in this election cycle. Big business has to begin considering how to help small businesses and entrepreneurs make their way, improve employees’ financial wellbeing by, for example, offering instruction on saving for college or making a budget, and even enlisting the support of retired CEOs. There has to be a way to make sure that business gets credit for what it has done and have a voice on its own reputation. Someone has to take the first step.

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Face to Face still Mattershttp://www.reputationxchange.com/face-to-face-still-matters/ http://www.reputationxchange.com/face-to-face-still-matters/#comments Wed, 29 Jun 2016 22:22:20 +0000 http://www.reputationxchange.com/?p=18395 I just read this statement from the CEO of the Financial Times and I said to myself, oh so true. “Corporate events are at growing at double-digit rates. It’s interesting because I think it’s the flip side of the whole digital evolution: Business people like to network....

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I just read this statement from the CEO of the Financial Times and I said to myself, oh so true. “Corporate events are at growing at double-digit rates. It’s interesting because I think it’s the flip side of the whole digital evolution: Business people like to network. They like that physical engagement.”

The number of conferences seems to grow by the day. And clearly the reason is exactly as Ken Doctor says….face to face is still critical — and always will be — to getting business done. We have a whole unit dedicated to business conferences because they have grown exponentially and companies need expertise on which invitations to accept. External engagement and networking is key to advancing the business and getting heard. CEO reputations can be given an assist by speaking at the right venues, before the right audiences and with the right peers. 

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Risks and Rewards of CEO Activismhttp://www.reputationxchange.com/risks-and-rewards-of-ceo-activism/ http://www.reputationxchange.com/risks-and-rewards-of-ceo-activism/#comments Sun, 26 Jun 2016 19:46:54 +0000 http://www.reputationxchange.com/?p=18385 We just released new research with KRC Research on CEO activism and I want to share some of the findings here. I also wrote a piece in Harvard Business Review that you might find interesting. As a long-time observer of CEO trends, we wanted to get...

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We just released new research with KRC Research on CEO activism and I want to share some of the findings here. I also wrote a piece in Harvard Business Review that you might find interesting.

As a long-time observer of CEO trends, we wanted to get a good read on this new dynamic and its impact on reputation. To be sure, CEO activism has at times been very effective. In the past year or so, a number of CEOs have spoken out about social and environmental issues such as climate change, income fairness, same-sex marriage, immigration, gun control and discrimination – all issues that are not necessarily tied to the bottom line. Yet, we also learned that there are some risks that should be carefully considered. Here are the key findings.

1. First, nearly 40% of Americans believe that CEOs have a responsibility to speak out on hot-button social issues. However, the survey also showed that chief executives need to be cautious with the topics about which they choose to speak out on, as three in 10 (32%) have a less favorable opinion of CEOs who speak out on issues not tied to their companies’ bottom lines.

2. The belief that CEOs carry such a responsibility is most likely to translate to favorable opinion toward CEOs who do speak out. When respondents are asked their opinion of CEOs who take public positions on hot button issues, the scales tip in favor of the CEO (31% more favorable vs. 22% less favorable). Yet, when the issues are not directly linked to a company’s bottom line, the reverse is true and Americans feel less favorable. Favorability is thus dependent on how strongly an issue’s link is to the bottom line.

3. A CEO’s stance on controversial issues can also impact purchase intentions. While 40% say they are more likely to buy from a company when they agree with the CEO on an issue, a comparable number (45%) say they are less likely to buy if they disagree with the CEO’s position. Since a CEO’s external stance may affect behavior as basic as buying a product, companies need to have a firm understanding of the attitudes of key customers and other stakeholders before CEO activism goes public.

4. The public does not fully credit CEOs’ motives for taking public positions on hotly debated issues. Americans believe the top reason for CEO activism is “to get media attention” (36%).  At the bottom of the list is “to attract and retain the best employees” (7%). Clearly, if CEOs want to signal that the well-being of employees is at the heart of their activism, their message is not resonating loud enough.

5. Millennials (18-35 year olds) are the generation more inclined to favor CEO activism. They are more likely than other Americans to be aware of CEOs having taken public positions on controversial issues, to feel favorably toward CEOs who speak out, and to say that they will buy from companies whose CEOs take a public position they agree with. For companies looking to appeal to the next generation, CEO activism might just be the right course of action.

As the world grows more complex, polarized and politically-charged, our research provides an early roadmap for CEO activists to consider when speaking up on pressing societal issues. It is understood that CEOs have to carefully balance many constituencies but they will find themselves increasingly in the spotlight as they try to make a difference in a world that requires them to stand up and be counted. This new strain of CEO activism requires leaders to articulate their positions in a straightforward, unambiguous and meaningful way in order to be fully understood. Because of the need to protect reputation and not find oneself in the eye of the social media firestorm for being misunderstood, we provide 12 Guidelines for CEOs and their companies who decide to speak up and out. Take a look.

 

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Millennial Slant towards Healthcare and Sciencehttp://www.reputationxchange.com/millennial-slant-towards-healthcare-and-science/ http://www.reputationxchange.com/millennial-slant-towards-healthcare-and-science/#comments Fri, 17 Jun 2016 22:26:08 +0000 http://www.reputationxchange.com/?p=18365 Where do Millennials want to work? Here is a study that points at new preferences. What is clear is that this cohort wants to work at companies that make a difference in society and in their own lives.The 13,000 respondents in the sample, ages 15 through 32, are...

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Where do Millennials want to work? Here is a study that points at new preferences. What is clear is that this cohort wants to work at companies that make a difference in society and in their own lives.The 13,000 respondents in the sample, ages 15 through 32, are from the National Society of High School Scholars (NSHSS), an Atlanta-based  membership honors society. The sample is tilted towards females (76%). Millennial respondents were asked to pick companies they’d like to work at from the Fortune 100 Best Companies To Work For, DiversityInc’s top 50, and additional companies from the Fortune 500.

Whereas in many other studies, the companies that rise to the top are Internet, financial services and consulting companies, we see a greater focus on healthcare and science here. Four in 10 (41%) pick companies in the medicine and health field and about one in four choose companies in science, technology or engineering (21% to 30%).  Here is the full list which includes nearly 125 companies) and here are the top 10:

2016 Millennial Career Survey Preferred Companies:

1. 3M

2. Google

3. St. Jude Children’s Research Hospital

4. Walt Disney Company

5. Local Hospital (EMT, Etc.)

6. FBI

7. Buzzfeed

8. Apple

9. Central Intelligence Agency

10. Amazon

As you can see, the top 10 list is as likely to include 3m as St. Jude’s Hospital, the FBI and Amazon. It is an eclectic group but speaks to the reputations of a whole different set of companies than the usual ones we are used to seeing where Apple leads the list. Apple falls in at #8, following Buzzfeed and the FBI. Respondents say they are most interested in companies that have good workplaces and treat employees fairly, are socially responsible, provide flexible hours, good work/family balance and good benefits.

One particular set of questions particularly interested me. When asked which global issues they were most interested in making a difference in, education led the list by far. Nearly one in two Millennials say that’s where they’d like to focus their attention, followed by health issues. That’s great news since education is probably the single most important area that can help change the future in a positive way. Politics falls at the bottom which says a lot about how effective Millennials think they can be in that arena. Unfortunate. Political incivility has gotten to them.

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First 100 Days Advice from the world of Sportshttp://www.reputationxchange.com/first-100-days-advice-from-the-world-of-sports/ http://www.reputationxchange.com/first-100-days-advice-from-the-world-of-sports/#comments Sat, 11 Jun 2016 18:39:06 +0000 http://www.reputationxchange.com/?p=18354 Advice from the newly named president of the Harlem Globetrotters on the first 100 days. The writer of the article sums up the new president’s counsel saying that leaders must pivot forward to the next decade by focusing on “to be” goals and “to do” goals. Smith is saying: “The...

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Advice from the newly named president of the Harlem Globetrotters on the first 100 days. The writer of the article sums up the new president’s counsel saying that leaders must pivot forward to the next decade by focusing on “to be” goals and “to do” goals. Smith is saying: “The first asks: “What kind of organization do we want to be?” The second focuses on: “What do we do to deliver results?” Fairly simple and eminently useful.

Smith’s wise advice, however, got me thinking about the use of the word “pivot.” When did this word arrive on the scene and when will it go away? I actually started hearing it about three years ago and assumed it was a political term being adapted for corporate communications. I often heard it in conversations about getting a CEO or company to change the conversation. I try not to use “pivot” because it is a subtle way of telling others that they know a lot more about campaign strategy than you do. It has certainly been used a lot  lately with regard to the political campaign season we are barely living through. You can only imagine how glad I was to learn that I am not alone. I found this NPR article from Scott Simon and written just today complaining about pivot’s over-usage. What a relief since I can just link to what he says and I do not have to ramble on any further in criticizing it. He agrees with me that “…these words are often used to sound authoritative while being obscure.” I have to admit though that it is a great scrabble word.

 

 

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The CEO Three Year Itchhttp://www.reputationxchange.com/the-ceo-three-year-itch/ http://www.reputationxchange.com/the-ceo-three-year-itch/#comments Fri, 03 Jun 2016 16:55:25 +0000 http://www.reputationxchange.com/?p=18346 In my last post, I wrote about a recent McKinsey Quarterly report on new CEOs which had valuable information. The one thing I left out and saved for a follow up post was this finding which showed up in the last few sentences. The authors reported...

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In my last post, I wrote about a recent McKinsey Quarterly report on new CEOs which had valuable information. The one thing I left out and saved for a follow up post was this finding which showed up in the last few sentences. The authors reported that “On average, an inflection point arrives during year three of a CEO’s tenure. At that point, a CEO whose company is underperforming is roughly twice as likely to depart as the CEO of an outperforming one—by far the highest level at any time in a chief executive’s tenure.” I guess you might call it the 3 Year Itch.

This finding matches with some research I had done years ago on CEO tenures. By 18 to 24 months, you either have the board and employees’ support or not. It then takes a year or so for any action to happen on that level of success and then the CEO departs. It often appears sudden but is not.

This is incredibly relevant information because as we advise CEOs in their first 100 days, the three year marker is critical to point out. We always mention the significance of the 1 year anniversary because that is when the media does their roundups on how well the CEO has done and whether they delivered on their promise. The three year itch comes up fast, afraid to say.

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New CEOs — Be Boldhttp://www.reputationxchange.com/new-ceos-be-bold/ http://www.reputationxchange.com/new-ceos-be-bold/#comments Thu, 02 Jun 2016 12:10:15 +0000 http://www.reputationxchange.com/?p=18332 A report from McKinsey Quarterly on New CEOs has some very valuable information. Looking at what 600 CEOs and the strategic moves they made in their first two years, the researchers found that there were more similarities than expected. They looked at new CEOs from S&P companies...

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report from McKinsey Quarterly on New CEOs has some very valuable information. Looking at what 600 CEOs and the strategic moves they made in their first two years, the researchers found that there were more similarities than expected. They looked at new CEOs from S&P companies who left between 2004 and 2014.

Their overall conclusion was that most CEOs focus early on a few bold moves and work to bring an outsider perspective to the company’s challenges, regardless of whether they are an insider or outsider CEO. To make it a fairer comparison, they looked to see how the companies did prior to the new CEO’s arrival — was it a well-performing company, a poor-performing company or a fairly well-balanced company in stable shape? They found no real differences between CEOs in different performing companies in the kinds of strategic moves that the CEOs made.

Screen Shot 2016-06-01 at 9.23.55 AMThe most common strategic move among new CEOs was a management reshuffle, followed by a merger or acquisition and a cost-reduction program. According to the report, poorly performing companies did better when their CEOs restructured their management teams which was not the case for higher-performing companies. The greatest difference in new CEO moves in well-performing and under-performing companies was in strategic reviews where the latter was more likely to take this route.

Even more interesting to me was what they learned about bringing in an external CEO vs. an internal CEO in terms of performance. External CEOs were much more likely to make bold moves than internal CEOs — moves such as organizational redesign, cost-reduction, geographical contraction and business/product closure. External CEOs have less allegiances and have a greater ability to bring an outsider’s perspective to the business at hand.

The report offers great lessons to be learned for new CEOs:

1. Adopt an outsider’s mind-set. Regardless of whether you came to the position from inside the organization or outside, try to build your outsider point of view.

2. Don’t follow the herd. They suggest looking deeply into the context of your company’s performance and quantifying how best to start making moves.

3. When you’re behind, look at the whole playbook. A bias for action is recommended. Aim high and plan the year ahead.

 

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Summer Reading from Gateshttp://www.reputationxchange.com/summer-reading-from-gates/ http://www.reputationxchange.com/summer-reading-from-gates/#comments Sat, 21 May 2016 13:56:36 +0000 http://www.reputationxchange.com/?p=18326 How much fun is this! An animated summer reading list from Bill Gates. A smart way to communicate without the formality and pomposity that goes with most chief executives. A newer way of storytelling from the top. Clearly, Gates is just sharing with us his favorite...

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How much fun is this! An animated summer reading list from Bill Gates. A smart way to communicate without the formality and pomposity that goes with most chief executives. A newer way of storytelling from the top. Clearly, Gates is just sharing with us his favorite books for the summer and does not need to further building his reputation.  He has enough good will already. But it makes him and all the initiatives at the Bill and Melinda Gates Foundation appear even more grounded and ahead of the curve because of his focus on deep thought and learning.

Short, snappy and makes you want to read each book. Clearly, no romance novels. It is entertaining (love the robot), accessible and it feels like he is sitting right next to you having a conversation. And what could be more important than reading a book, an activity we have little time for these days. I like that he only gives you 5 books to read this summer, that’s about one every two weeks. Manageable? Read away (if it ever gets warm here).

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