Republican candidates usher in post-branding era

Don't look now but the BCS championship-like race for the Republican presidential nomination is ushering in the post-branding era. What does that mean? The traditional methods of branding, such as communicating a consistent message over time, have been replaced by pressure to get to the core faster than ever before anyone changes their minds. Audiences no longer matter as much as loyal followers, which takes more effort than sending out Tweets every hour. Performance and organization trump buzz for now or at least until buzz forms -- then all bets are off. Here are some other observations along similar lines:

1. Voters aren't as nuanced as the candidates think they are. But they still shop with a value-driven vengeance. It makes less difference whether you're a Tea Partier than it does someone who can hold sway without extremism overcoming sound principles. Rick Santorum's emergence in Iowa as the evangelical darling occurred AFTER caucus goers decided that Rick Perry and Michelle Bachman weren't as appealing. It wasn't sleeveless sweaters that garnered 25 percent of the vote; it was good 'ole fashioned hard work and retail appeal. Think Walmart before they got fancy with the new marketing regime.

2. None of the candidates have captured the essence of the Republican brand, which may be a good thing. Without an anointed presumptive winner in traditional party form no one in the field represents an A-player. The now perceived front runners are old names trying to reinvent themselves into something new. Think of the remaining field as brand extensions, or in the world of laundry detergent, lots of Cheer and generic names vs. the go to Tide. Mitt Romney and Ron Paul are hardly new exciting figures in the same image as Barack Obama in 2008. The media love a darling, but to date, no one can or will claim the mantle. This leads to an unfortunate formula: Little differentiation + known quantities = snooze fest.

Here's hoping Monday night's BCS championship game doesn't suffer the same fate!

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Hardly coincidental

The re-ascendancy of Starbuck's CEO Howard Schultz to Fortune magazine's top executive ranking comes as no surprise. His company, or should we say the existing one he was hired into and then proceeded to re-invent, is a household name and just completed a record year of revenues and profits. It seems as though customers are still willing to pay five bucks for a latte even in these "most uncertain times."

What's revealing about the Schultz story, however, isn't so much about dollars and cents although record performance plays a leading role. It's more about Schultz's ability to straddle the growing fence between political crusader, community activist and business steward. These skills have increasingly grown in demand as large companies navigate an era defined by big government, regulation and environmental accountability. Schultz and Starbuck's have been at the forefront of this trend. Their continuing stamp of success reveals a few undeniable truths for leaders and businesses alike, mainly:

1.) Having a point of view about the issues impacting your business matters more than ever. When Congress and the president nearly ground government to a halt last summer over the debt ceiling, Schultz came out swinging, calling for a boycott on contributions to office holders and candidates alike who espoused obstructionist views. This was classic POVing at its highest form. Pro-active, controversial and lone wolf in tone and content. During a time when most companies are playing both sides of the aisle with contributions, Schultz made the calculation that it was in no one's interest to maintain the status quo. He of course didn't have to make this stand but did so because he evidently believed in the action. If more leaders and companies would follow suit maybe more of the "change we believe in" could occur? The recent more reactive response to immigration by Chipotle CEO Monty Moran partially qualifies although admittedly espousing a POV on an issue after an offense can be perceived as spin.

2.) Being willing to take a stand on unpopular but proper business practices, even when it represents great cost, can make a difference over time. This used to be called investing in a business. Despite high costs of doing so, Starbuck's still provides health care coverage to its part-time and full-time employees. Schultz has continually gone on record saying that will never change. The rewards come in the form of employee loyalty and lower turnover, which results in more consistent service, which leads to higher revenues and profits. Again more companies and leaders would be well served to track this line without solely focusing on short-term financials as a primary outcome. Easier said than done. But necessary.

Click here for the original Fortune magazine profile if you didn't already have the pleasure of reading over the holidays: http://management.fortune.cnn.com/2011/11/17/starbucks-howard-schultz-business-person-year/

Thanks for viewing. Happy New Year,

JG

Coming Home

As we plan to travel for the holidays, a different homecoming theme has emerged in this week's business news.

First, the passing of former HP board chairwoman, Patricia Dunn, whose biggest claim to executive brand fame was allegedly knowing about phone wire tapping of other board members and not properly disclosing the behavior. By the time others, including HP board member Tom Perkins of Kleiner Perkins, got done with the public character assassination, Dunn's reputation resembled mincemeat. She was later exonerated of any legal wrongdoing. Now we learn about her long battle with ovarian cancer, which resulted in the former executive's death. This passing is great reminder of what's important in life vs. business. It's our sincere hope that as publicly reported Dunn died peacefully with love from family, friends and God close by.

The next example is someone who hasn't died but faces a rare terminal illness called PSP or "progressive supranuclear palsy." Famed deal maker Richard Rainwater is battling for his life after a long run of Midas touch business investments and dealings. Fortune has a great profile of both the man and situation http://management.fortune.cnn.com/2011/11/07/richard-rainwater-psp-fight/; it's why we still turn periodically to magazine journalism. As a personal aside, Rainwater's second wife, Darla Moore, is a legendary philanthropist and public figure in South Carolina. I have seen her modest house in Lake City and can personally attest to the private jet air strip for quick deal making trips.

These two examples may not conjure up visions of sugar plums, but the takeaway is important. Please take stock of health and key relationships this holiday season. Life is too short not to.

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HP: Interim to permanent CEO

Who says rock star CEOs are dead? The expected announcement that former EBay CEO and current H-P board member Meg Whitman will become CEO of Hewlett Packard (HP) underscores how much personal brand power matters in tumultuous crisis situations. Normally when there's turnover and the preceding position holder came from outside the company, Fortune 100 companies will turn to an internal executive candidate. HP, however, has quickly become a poster child of horrible governance, which means they probably felt like they had to go with a known brand name. Insert Whitman who joined the HP board earlier this year.

The real question now becomes whether or not the board considered internal candidates before offering the position to Whitman. It's often perceived as a conflict of interest for a director to join a company board without stating his or her intentions on becoming a company executive. In this case, it would help inform the story if the company were willing to say that they considered internal and external candidates before naming Whitman. Of course they can always say that publicly without really meaning it, which is why more reporting on the process will be necessary. Another easy out is the fact that Whitman is a brand name leader, which provides yet another buffer to a board that clearly has lost track of its own -- and the HP Way.

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HP: Turmoil = Interim CEO or acting director

As presciently forecasted last year -- http://povblogger.blogspot.com/2010/08/h-p-ceo-follies-let-games-begin_09.html, Hewlett Packard remains mired in turmoil. Latest case in point: News that the company's maligned board will replace their third CEO of the last six years. While no one knows publicly yet what the company and its board will do next, it's fairly certain that an interim CEO or board member acting in a similar role will fill the primary leadership position. What's not known, despite reports to the contrary, is who that will be. Here's a dirty little truth that few seem willing to accept: It now doesn't matter who the executive is. Until the board can correct itself (begs the question: Is this even possible?) and find a way forward, no one filling the CEO position can be successful. Classic chicken and egg scenario if there ever was one...Aside from the leadership question, it's always interesting to note that while Leo Apotheker has now failed publicly just as his predecessors did, it's hardly failure of the every day sort. He will walk away with $35 million in severance pay, a princely sum by any measure. Whoever said jobs weren't all about money and prestige never worked at the highest corporate levels.

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When Brian Met Sally; 10 steps to recovery

One of the most powerfully perceived women in business, Sallie Krawcheck, has essentially lost her job for the second time in three years. According to today's Wall Street Journal, Krawcheck has been forced out of her position at Bank of America Corp. (BofA) following a consolidation of power by CEO Brian Moynihan. This follows a similar post at Citigroup where she worked prior to joining BofA. Here's a list of transition recommendations for this high powered brand to consider:

1. Join Obama's Jobs and Competitiveness Council. Bring some diverse truth in love to GE Chairman and CEO Jeffrey Immelt. Commiserate with his private/public plight as the council struggles mightily with the issue of the decade. Avoid 10-year later "what are you doing now?" stories at all costs.

2. Go back to the recruiter who helped land the BofA job and beg for payback on other plum assignments. If that doesn't work, call Ken Lewis and ask for a payday loan.

3. Write a real book titled, "Failing UP." Become a guest host on CNBC's Squawk Box. Mend brokenness by confirming everything hosts Joe Kernen and Becky Quick have to say about banking.

4. Join more boards -- Preferably big international banks that have an eye on unseating BofA such as HSBC. Disregard non-compete agreement. Remember success is sweetest form of revenge.

5. Consult friends in private equity, the last bastion where Linked In connections and failing up meet square on to create new career opportunities.

6. Start a powerful yet virtual women's career transition and support group named: "Recovering Divas of Industry." Invite former co-worker Barbara DeSeor and fired Yahoo CEO Carol Bartz to become members. Track down Marcy Fuller, Carly Fiorina and Paula Rosput Reynolds to serve as special advisers.

7. Get out of town. Keeping with international/global re-positioning theme, travel and meet with as many bank CEOs and boards as possible. Leave no stone unturned. See if BofA will grant some severance fly time on one of their corporate jets.

8. Re-discover balance at home. Support husband's dreams following his service raising family and managing household. Attend any and all special functions, events and games at children's schools. (Re-read last year's WSJ special feature on Most Powerful Women, which referenced these points at length.)

9. Wait patiently by phone for recruiters to call with next opportunity. Set PDA on vibrate during day; silent at night. For those sleepless nights consult the book of Psalms.

10. After six months of dust settling, re-emerge as head of a regional bank in U.S. such as Regions or SunTrust. Move their headquarters to Wall Street, merge with Goldman Sachs and then jointly declare that the "era of big bank consolidation is over." Continue on chosen privileged path.

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Two big brand names, one different take

Yesterday's news that Steve Jobs was stepping aside from Apple and today's announcement that Warren Buffett will invest $5 billion in Bank of America provides business leadership pause of the first order.

First, Jobs. Silicon Valley Icon. Successful entrepreneur. Failed CEO then back to a higher degree of success than ever before -- with the same company he founded. Unarguably the vision behind what may be the most successful suite of consumer products that the world has ever seen. Apple is a business case study of the highest order by any measure. The only possible exception may be the company's governance, or lack of clear succession plan. Then again, in reality, it's impossible to think that Apple's board could replace Jobs with anyone without taking a hit so why not kick the can down the road when everything is going well. Classic short-term vs. long-term thinking, which is another issue not worth going into here.

Now let's turn to the man himself. According to separate first-hand accounts from those who have actually worked with Steve Jobs (note to close readers: One was a Point of View LLC client; the other was someone who had close dealings when Jobs was replaced by John Scully as CEO), Jobs is at best a hard charging, take no prisoners, crush the competition business man. At worst, an asshole, according to first-hand impression.

The question then becomes: Does this type of behavior indicate anything relevant to standing as a business leader? Or are these traits simply what's necessary to be effective at a big business level? For comparison purposes, is there any difference between what Jobs demonstrated in one-on-one dealings to create great products vs. what Gen. George Patton (played brilliantly by George C. Scott in "Patton") modeled during World War II?

Oracle of Omaha comes to the rescue again

Buffett's investment in Bank of America Corp. essentially rescues an equity headed into the ditch following questions about the bank's capital reserves. The $5 billion investment, which comes with a guaranteed six percent return, also recalls a scarier time back when the market crashed in 2008 and the Oracle of Omaha came to the side of Goldman Sachs, which at the time was the country's largest still standing investment bank (if those distinctions matter anymore.)

Now, three years later, this gesture is viewed as absolutely necessary in the era of Too Big to Fail or negative reminder of how little banking has progressed since TARP bailouts. The Buffett brand remains directly positioned in the mix.

As a long-time observer and admirer, I'm slowly arriving at a different place when it comes to Warren Buffett's standing as a brand-name leader. It started back when his memoirs were published in 2008, and the Wall Street Journal reported that Buffett opposed some of what eventually was revealed with his own approval. This isn't uncommon but it still created a new perception. Buffett also been very vocal and publicly visible on CNBC almost to the point of calling into question when is it enough? When President Obama sought public approval to help reach a deal that eventually led to the nation's debt being downgraded, he called on Buffett and then proceeded to broadcast to the world what "my friend, Warren Buffett" had said. So much for confidential decorum.

There's a underlying nagging question out of all of this and that is...Do we need to see and hear from our leaders as much as we do now in the 24-7 news culture? Doesn't that take away a certain amount of gravitas or perceived credibility? Has the public/private disclosure balance been forever imbalanced?

Please let us know what you think sometime about these questions in the context of effective leadership. Always reaching for a different view to help sharpen our own. Thanks for reading,

JG

Lost dignity of work

The oldest employment rule in the book is it's better to have a job when looking for another job. No one can argue that truth except of course if you're someone who needs to close one door to open another or you're stuck in the crosswinds of structural change.

Fast forward to the present or wake of the Great Recession. Employers are taking the current employment rule to the streets, according to today's New York Times: http://www.nytimes.com/2011/07/26/business/help-wanted-ads-exclude-the-long-term-jobless.html?ref=business

While not hiring the long-term unemployed is understandable from the employer point of view, especially the point about incompetence, there's something fundamentally wrong about denying someone work simply because he or she doesn't have a current job. This slope started with the advent of credit checks to deny applicants work.

Try going a little deeper here or beyond the surface of basic dollars and cents. Those who haven't worked for a long time generally need or want to even if they have to depend on public assistance. To be denied this desire can lead to mental or emotional problems. Or the loss of basic dignity.

It would serve large employers and their leaders well to evaluate whether the value called the dignity of work still exists in their workplace. Chances are if it doesn't exists then it becomes easier for HR folks and lawyers to list current employment as an essential for consideration.

Let us never forget that there are human beings behind these laws and rules even though it's difficult to recognize at times. Is the dignity of work a leadership responsibility?

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Just do something, please (Part II)

While the last TGR post laid out fallacies of taking a macro-approach to the jobs issue, this installment speaks to why it's nearly impossible to find actionable common sense among leaders in the public square. Following is an anecdote to help explain the case.

A client and friend runs a small business in Decatur, GA. It's a 25+-table restaurant that's been extremely successful for more than 15 years. Family owned and operated, this business represents what traditionally has defined the American Dream. Man/wife find local niche, decide to take risk and then establish customer base highly loyal to the niche. Pricing premium serves as no obstacle due to high quality product and delivery rewarded by customers willing to pay again and again.

This isn't to say that managing the business has been a bowl of cherries. Between trying to remain cash flow positive to keeping uninsured employees from walking out the door, the challenge is palpable -- hourly, daily and weekly. The basic difficulties, combined with personal physical toll, create complexity that the conventional "9 to 5" worker never experiences. Anyone out of the roughly 50 million independent small business or "free agent" workers who own their own companies in the United States is familiar with similar difficulty.

To compound the situation, no special interest or lobby has my friend's back. Plenty of organizations, such as local chambers of commerce and the Small Business Administration (SBA) pay lip service to the plight of small business. At least one political party likes to wax on about how small business creates 70 percent of the nation's jobs. Yet very little empirical evidence ever makes a difference when stacked against a system that's rigged to reward big business, big labor and big government. This reality is showing no signs of hope and change anytime soon. No one currently in the presidential race has the credibility to stand up for small business despite what they may be spinning.

It wasn't always this way. Our nation's founding fathers all worked "in the fields" so to speak. Necessity was the mother of invention. Jefferson and Franklin were land owners who invented everything from the dumb waiters to plows, bifocals, stoves and clocks. Going back to post-World War II, some veterans returned to start general stores, many of which were given rise out of debilitating injuries or chronic illness. The modern day version of this type of entrepreneurship is absent or mediated to appear like it only exists on-line in the technology sector. Today's military veteran returns home with very few benefits, if any, and very little chance at starting a business due to lack of financing and exorbitant costs. There's something fundamentally wrong with this picture -- one that's distorted even more by negative profiles of people outside of large cities depicted as simple minded and intolerant. Recall Joe the Plumber from the 2008 election before the ensuing publicity circus.

Doing something in this context means removing more obstacles for Mom and Pop, identifying with their cause and standing up to take the (country) economy back. This isn't to suggest ignoring the global marketplace; it's more about getting down to the local core where many have re-congregated. That's leadership defined. Too bad no one with the pulpit seems able to make a difference at this level. Herein lies the key to unlocking value and more domestic job creation; not continuing to move the chairs around on the big business tax cut/debt Titanic. Good day,

JG

The Garlington Report (TGR)

Top leadership blogs

Niche bloggers normally bask in obscurity, flourishing in the weeds as they wait to pounce on gaps or scoops otherwise not covered by mainstream media. Until of course they're recognized. Here's our own latest example via blog aggregator/evaluator, The Daily Reviewer. See link for more background: http://thedailyreviewer.com/blog/11830. TGR appears on page five (5.)

Politics vs. performance

One of the nagging headaches with commenting on issues perceived as public policy is how so few are willing to discern substance vs. partisan viewpoint. It nearly always takes gravitas not to sound shrill these days, present company included. This is why reading over today's latest opine from Bill George provides pause. George is arguably the nation's leading "in the lab" expert on business leadership. Not only has he run and led a successful company, Medtronic, George has captured the experience via teachable content approaching on par with Peter Drucker. (Pity those who have to Google Drucker to be informed.)

Here's hoping TGR readers did not miss this substantive call for action from today's DealBook, New York Times: http://dealbook.nytimes.com/2011/06/27/obamas-choice-on-jobs-politics-or-policy/?ref=business

# # #

Just do something

When it comes to jobs, has there ever been a time when so few leaders seem able to address much less solve an issue?

Exhibit A is whatever the President's Jobs and Competitiveness Council (JACC or JACK?) is trying to accomplish with their new publicity push, which was kicked off with a media blitz earlier this week. Here's a WSJ op-ed that spells out the perceived mandate: http://online.wsj.com/article/SB10001424052702304259304576380323311523538.html

For those left scratching heads on how the Council formed, consider a refresher course. President Obama appointed General Electric CEO Jeffrey Immelt in January to head a lofty group whose mandate is to to generate more domestic jobs -- as in work for those in this country vs. everywhere else in the world. That leaves five months from formation to current frame. Hold that thought for later in the post.

Immelt's appointment was widely hailed despite the fact that as CEO of General Electric he has overseen one of the largest destructions of shareholder value in the company's history. Not to mention the additional fact that at the time of Immelt's appointment the company seemed unwilling to admit that they had failed to generate any high paying jobs in this country since the Jack Welch era. Efforts to contact the company directly for comment would be made with more vigor if there were assurance it would yield revelation beyond their standard line about operating as a global company.

Immelt has since teamed up with fellow smooth sailor American Express CEO Ken Chenault to address the situation. Following are some interpretative highlights of their recommendations. (You will need to read the previous WSJ piece to understand the takeaways.)

1.) Process isn't the product. "Ninety-day recommendations" proceeded by more "strategic actions" over the next 90 days translates into a lot of nothing for six months. Combine the lag between official appointments and final recommendations and we may have nearly a year of inaction during a period when economic recovery indicators have softened. Unfortunately those who occupy rarefied leadership air stumble around according to these frames all the time while Main Street burns. Those of us who actually have to work every day know that life doesn't allow extended strategic review. It requires actually doing something. Pity the rafts of PR staff and executive assistants who have to endure this nonsense.

2.) Flawed content. Specific content contained in the recommendations doesn't inspire a lot of hope in something new and better emerging to replace the old hinges. "Rehire more construction workers" and "boost jobs in travel and tourism" sounds like a pre-Digital Age prescription from the Carter or Reagan administration. If the Council and Obama administration are serious about more employment in the construction sector, where's a renewed public/private sector call for a Manhattan project to rebuild national infrastructure? (originally called for by former NYT columnist Bob Herbert.) Or has stimulus money from the Economic Recovery Act already run out? As to tourism jobs, does this mean turn the country into a big Disney World so more will come and spend their higher valued currency? Someone needs to go interview retailers in southern Maine about what they think about French Canadians from Quebec who invade every summer. That might actually yield some better ideas, or at the very least, dislodge tin ear wax at the 50,000-foot leadership level.

3.) Divide extends even further. Combine 1.) and 2.) with lack of entrepreneurial friendly focus, i.e., "hey guys, did anyone mention trying to start or build something new vs. masking the old via 'innovation?'" and you've got more of what got us into this mess. Status quo thinking from those who have felt zero personal pain in the Great Recession. Which in turn has yielded very little if any forward progress. Granted the economy has been on its ass for a few years but still. Left wing NYT columnist Paul Krugman calls the disconnect a "top down disaster," and more recently has compared the current climate to "rule by rentiers," http://www.nytimes.com/2011/06/10/opinion/10krugman.html?ref=paulkrugman, which refers to special interests that reign supreme by pacifying the asset rich vs. serving common Joe and Jane. This is the most glaring issue that the current administration and none of the Republican candidates for president seem able to tackle. It spreads into most sectors, including big banks, which seem immune to change and forever determined to rig the system to their own benefit at the expense of fixing anything, such as the housing mess. Until the disconnect between the have mores and have nots is restored with something of meaningful value, Nighttime in America will remain present for the foreseeable future. That's a damn shame. We're better than this -- or at least better than what our leaders are supposedly doing to lead. Good day,

JG

Editorial note: Despite named subjects, this is not a political message. It's a call for more common sense that must exist somewhere but doesn't seem to make its way to the highest levels of perceived power.

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Rare display

From the New York Times (April 26, 2011:) Sports Tuesday

BEHIND THE DECISION

'The public interest represented by the fans of professional football -- who have a strong investment in the 2011 season -- is an intangible interest that weighs against the lockout.'

-- U.S. District Judge Susan Richard Nelson

Leave it to a judge in a labor dispute to give life to a dying cause: The public interest. The above quote leapt off the page the other day mainly because the value is so seemingly fleeting in leadership circles. Whether one side or the other "wins" in the NFL lockout case is beside the point. For a shining moment, the fans' interest was represented in full glory. Other spheres should take note.

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Quote of the year

Intellectual honesty can be difficult to find sometimes when an executive speaks on the public record. In the case of Exxon's Chairman and CEO, Rex Tillerson, honesty last week in the Wall Street Journal ("Exxon tilts to oil again," March 10, 2011) came through with blunt candor. The context was a story describing how when most oil companies are diversifying exploration efforts Exxon has decided to focus on their bread and butter. Here's the quote:

...Rex Tillerson, Exxon's chairman and chief executive, said the company doesn't have a specific preference for producing oil or gas. "There is no bias for us one way or the other. Our bias is to make money."

During a time when big business enjoys low approval, this quote is refreshingly clear. Critics can cry all they want about means to an end in Exxon's case but at least shareholders know job number one. Thanks mainly to a leader who doesn't mince words.

# # #

Welcome to new normal transparency

Are you and your leadership position standing on a "burning platform?" Nokia CEO Stephen Elop has posed that question internally to employees in the following memo published this morning by the Wall Street Journal: http://blogs.wsj.com/tech-europe/2011/02/09/full-text-nokia-ceo-stephen-elops-burning-platform-memo/. It lays out a ringing indictment for why the company needs to transform due to an untenable market position. More significantly, it shows how the lines of communication and disclosure have now permanently blurred. "Public" is every time you hit the send button. Ignore this reality at your peril. Or in Nokia's case, to a future potential market advantage.

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Founder's syndrome at Apple

This blogger that could would like to point to a previous post on Apple succession originally published back in January 2009. Here's an excerpt:

...It's a little better in iPod land from a performance point of view. But not necessarily at the board level. Apple has been forced out publicly recently with the hormone imbalance admission by Steve Jobs, which hardly quelled speculation that he will need to be replaced. For a board filled with high powered names such as Gore, Wexler, Jung and Schmidt, Apple's slate leaves a lot to be desired in the area of succession, which is arguably a board's first or second largest responsibility. Yes, we know Jobs is an icon and only he (or God) will decide his ultimate fate. But that doesn't negate a stronger need to show investors what the post-Jobs era will resemble. For every day that they obfuscate this issue, the board loses credibility and founder's syndrome takes deeper hold...

Bottom line: Apple is Steve Jobs; Steve Jobs is Apple. The personal and business/product brands are one. The company is a dramatically successful commercial enterprise, which tends to render the governance argument moot. That is until something happens to the brand, which in Jobs case, is an extended illness that everyone has known about for years. Why the board wouldn't take steps to reduce dependency on Jobs speaks volumes on where business is right now in the new New Normal.

Oh, and if you're wondering what we mean by Founder's Syndrome, then please review the attached link sometime: http://startitup.indieword.com/view/curing-the-founders.

Thank you,

JG

# # #

Where will the next set of CEO shoes drop?

The New Year is barely two cold weeks old, and already, brand name CEO changes have been occurring at a rapid clip. Newell Rubbermaid, NPR, Fox Networks, fallout from AMD. Name it to claim it.

The flurry of activity underscores a trend that started last fall: Turnover reflects companies need to change from a low to zero growth climate to a more aggressive posture in a slowly improving marketplace. Leadership tends to fall at the top of the change list, proving once again the chicken and egg battle facing boards. Do we need a star performer to create a winning strategy, or do we need better systems, process and culture/people to ensure sustainable performance? The answer is both but unfortunately far too many remain enamored with the savior mentality. We'll keep watching for exceptions to this conventional rule and will ask you do the same here.

Here's a prediction: After several years of declining turnover, this year will see more executive exodus than the previous two combined. Of course we said the same thing when the Great Recession was gathering steam back in 2009 and nothing really changed. Many boards decided the devil they know was better than the devil they didn't know. Guess that's how predictions go sometime. Some stick, others fail -- proving once again that trying to determine a new new normal future is a lesson in futility. It might just be better to enjoy the moment?

# # #

Beneath noise lies fundamental truth

Change is extremely difficult and damn near impossible without new systems, behaviors and people.

That's the takeaway on today's mid-term election. While the pundits and strategists argue ad nausea about who is going to win what, it would help to take a step back and understand this situation from a leadership perspective.

With all due respect to a good friend, what President Obama and the Democratic party's congressional majority face is not a communications issue. Or at least not fundamentally. More to the point it's a failure to answer the will of the people. The Great Recession has produced the most economic destruction since the Great Depression. Yet what was the first major initiative of the new administration and Congress? Stimulus in the form of government money, which as many Joe Q. citizens know, comes with at least a 5:1 ratio of cost vs. return. Translated dollar for dollar that means that for every dollar given back through the taxpayer it costs five more for the government to deliver basic product or service. The defensive argument that doing so helped save jobs that otherwise would have been lost just doesn't pan out in a capitalistic economic system. Never has, never will. The opposition's argument that stimulus has created crippling debt burdens isn't intellectually honest either. But that's another story and one best left to Paul Krugman at the New York Times.

Against this backdrop of both opinion and fact, we have had to witness the bailouts of banks, insurance and car companies too big to fail, which again while stemming red ink, galvanized public opinion. When people are losing their jobs and homes and they see big business being rewarded despite abject failure, isn't it normal to expect someone to deliver something back to them? To borrow a favorite phrase from another unpopular former president, that's just common sensical. Then came health care reform, which arguably is the most consequential piece of legislation since the Civil Rights Act. Yet most of what's contained in the new law either doesn't kick in right away, or worse yet, is unexplainable at a pedestrian level.

Here is what the current narrative boils down to. Our political leaders are failing us, but it's not entirely their fault (although they deserve the blame.) The system is broken. It's divided, dysfunctional, too big to fail and riddled with special interest, which only seems to grow during a time when it needs to be stomped out at the largest levels. Until someone with leadership chops and the will of the people can improve those two areas, nothing is going to change. The how is always dramatically more difficult than the what, where and when.

President Obama has all the personal leadership capability in the world, but until he finds a way to address and work like Hell to fix the system, his tenure will be marred by What Ifs. To suggest, just as his predecessor did, that it's impossible to manage a successful modern day presidency goes beyond the pale of passing the buck.

From a personal POV, it's been disappointing to watch how President Obama interpreted the original leadership mandate. See an earlier post from back in late 2007: http://povblogger.blogspot.com/2008/11/sailing-against-headwinds.html Such hope and promise only to be dashed by more of the same. What we have now is not Change We Can Believe in. It's more Change that Hasn't Happened yet. Or as John Stewart so appropriately asked in last week's interview: Are we still the people that we're waiting for? Too funny (For text enthusiasts, LOL or its lower case version, lol, which means not as funny.)

Here's hoping that the ship's course can be righted and the private sector economy continues to improve. To re-brand another old phrase: It's the Economy, Smarty!

###

Brand name turnover reaches new heights

Don't look now but brand name CEO and executive-level turnover is rolling like rapids down a river.

Pick your stat. from an industry tracker, or for simplicity's sake, go to the WSJ's Management page for a full run-down: http://online.wsj.com/public/page/management.html.

Just within the past few weeks, new CEOs or plans to have new CEOs have been unveiled at Twitter, Skype, H-P, Nokia, Rolls Royce and Campbell Soup. Other companies experiencing high-level turnover include Comcast, HSBC, MTV, Yahoo and Tesco.

Turnover at an elite level exceeds last year's rate, which was essentially flat based on economic conditions.

So what does this all mean? Well, for starters, consider these moves a sign that the market is slowly turning to more growth vs. contraction. While this isn't true across all sectors and the pain from the recession continues to impact the consumer, executive hiring tends to be a leading indicator within the overall jobs category, which tends to lag other indicators.

This activity will portend more deal making in the coming months, which is confirmed through M&A stats predicting 4Q to be a more active quarter. According to a nationwide report by mergermarket and Merrill DataSite, there were 1,701 deals totaling $326 billion during the first half of 2010. That is a 9 percent increase from the same period in 2009 (source: Atlanta Business Chronicle.)

New executive hires also mean more re-organizations since that's what new CEOs generally do to build their power base. That will lead to more shedding of jobs in some cases. It also will probably lead to additional strategic hires, a New Normal phrase that describes pockets of hiring vs. the across the board job creation.

The $600 million question (or gorilla in the room depending on your POV) is whether companies, flush with nearly $2 trillion in cash by some estimates, will take the leap and do more hiring in 2011? With profits up 38 percent among the S&P 500 (source: Wall Street Journal), there clearly is enough cash to invest in more workers. The market, however, needs more certainty vs. uncertainty to feel like the risk is worth the reward.

Having said all that, what do you think? Are CEOs and other executive-level leaders too risk averse right now? What's it going to take to get growth really moving in 1Q 2011? The TGR welcomes your comments and feedback. Thanks for reading,

JG

H-P Way near dead thanks to inept board

Today's announcement that an outsider without a current job will serve as CEO of Hewlett Packard officially brings the H-P Way to its final wake.

According to executive recruiters familiar with the situation, internal candidates who were glossed over for the top job are stronger than the new incoming CEO, Leo Apotheker. Choosing an outsider will only alienate the culture more, which regrettably has now been torn apart by a scared board of directors that desperately needs an overhaul.

The only silver lining to today's events is the fact that former Oracle executive and highly regarded venture capitalist Ray Lane will now serve as non-executive chairman. That's a coup for a company who used to have one of the strongest cultures in corporate America.

Now, unfortunately, that era is over. All in one badly intended decision to begin anew following a sequence of incompetence and ineptitude at the highest levels, earning distinction by the New York Times as the Most Inept Board in America: http://www.nytimes.com/2010/09/11/business/11nocera.html?ref=hewlett_packard_corporation&pagewanted=all .

Turn the volume down and you can probably hear the employee groans from inside H-P. There once was a time when that sentiment mattered. That time has now permanently passed. What a tragedy.

# # #

'Calmer-in-chief': My language, not theirs

Range of response to publicity never ceases to amaze. Earlier a friend suggested that "I wrote the AJC story." Uh, no, I contributed to the story, which the reporter wrote. Here's a link in case by some small electronic media chance you missed it: http://www.ajc.com/business/blake-is-home-depots-602558.html. And yes, the term "calmer-in-chief" was created precisely for this story (although admittedly we all have read that language before to describe U.S. presidents. Ok well, some of us have.)

There's something larger going on here beyond media foibles. A rapid fire tendency to offer opinion now permeates everything. We're all experts and the media doesn't know anything that we don't already know ourselves. This may be true in some cases, but for the most part, it's a dangerous place to be.

I couldn't have written the Frank Blake CEO story better mainly because I'm not objective nor am I compensated to write feature articles. That's a big difference in consultant/blogging land.

Which brings me back to the beginning: We need deeper feature writing to understand all the rapid fire going on around us. There will always be a market for perspective. Question is who is willing to pay for the need and where do those dollars travel to? Big brand media names? Niches? Bloggers? Twitterers? No one knows.

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H-P CEO Follies: Let the games begin

So another CEO, this one a high performing, successful operator, has bitten the dust due to character flaws. In typical form, the gaggle now is about who will be former HP CEO Mark Hurd's long-term replacement. Candidates galore are mentioned with rampant speculation. Following the normal and expected playbook, the company's board says it will search far and wide or both "externally and internally" according to the Wall Street Journal. A shootout among major search executive firms will soon take place. Turn the volume down a bit and you might be able to hear an echo.

Ok, let's stop for a minute and acknowledge a few truths. First, H-P will not be able to replace Mark Hurd overnight with someone from inside or outside the company. There's no one who knew the culture, people, strategy/execution and how that coalesces together to produce results more than Hurd. Not an interim CFO, not the lead director, not anyone presently identified in the mess. Ironically, Hurd was known as a great developer of talent, according to someone with direct knowledge of H-P. But unfortunately that skill evidently has now left the building, leaving the H-P Way under direct assault.

Number two, Hurd's departure with no clear successor, or no publicly defined succession plan*, means this situation will remain in crisis mode indefinitely. Which stacked against their recent troubles with previous CEO Carly Fiorina and board chairwoman Patricia Dunne begs the most important future looking question that no one seems able to ask -- much less answer.

What did Hurd and the board do to ensure someone could eventually take over when the current CEO could no longer serve? The CEO's primary responsibility is to lead the company and make sure it's well positioned for the future. That includes, along with the board, identifying who will lead when the current occupant no longer can. The story here is the board's inability to map out an effective succession strategy; not all the superficial stuff that drives day-to-day palace intrigue.

According to the New York Times, the H-P board was so concerned about the Hurd situation that they hired the public affairs behemoth, APCO Worldwide, to measure what impact the "sexual harassment without the sex" charges would have on H-P's reputation. What they evidently failed to measure was how much not having a contingency in place in case something happened to the CEO would drain the company's equity value. Friday's 10 percent drop in share price ought to answer the question with or without a hypothetical study.

Strong cultures know what to do when the proverbial s*&^ hits the fan. For a recent example, consider McDonald's Corp., which effectively dealt with the death of not one but two CEOs on their way to a new leadership regime under current CEO James Skinner. Granted the company has stumbled a bit lately with other potential internal successors exiting. But the basic point remains: McDonald's has a succession strategy and H-P evidently does not. They're not alone. At least a third of all major companies don't have formal succession plans. Based on events over the past week, H-P and their board must be wishing right now that they didn't fall in this category.

*Efforts to confirm whether H-P has a CEO succession plan were unsuccessful at blog posting time. The company did not return requests for information.

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BP: Board gaggle or giggle?

If there ever was a case that demonstrates what ails 21st century boards still stuck in the 20th century, then the naming of Robert Dudley as worldwide CEO of BP more than qualifies. Here's why:

1.) While Dudley deserves major credit for leading during the worst ever corporate disaster in U.S. history, his tenure will be marked by the same legacy culture that gave rise to the current role. Dudley worked for Hayward, which means he's inextricably linked to previous strategy. That never leads to innovative change yet somehow boards have convinced themselves that it does. The primary saving grace seems to be BP's solid financial performance globally minus huge losses mounting in North America.

2.) Boards under pressure never make good leadership decisions. While they may think Dudley is the right answer for right now, the fact that the board hasn't been transparent or even visible in the remotest way will continue to leave lasting questions about what they signed off on under Hayward. Those questions, combined with no sign of shared vision and values, means more of the same until Dudley can re-position the brand. That process will take infinitely longer than if an outsider came in to mix things up in what amounts to a complete repuational rebuild.

If Dudley is cagey on governance, he'll move quickly to consolidate his power and replace a few board members with stronger, more crisis-proven leaders from within industry. Surely there must be a few out there somewhere who would be willing to serve in a new regime?

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Spencer Stuart guides Nokia CEO Search

ATLANTA (July 20, 2010) -- The Garlington Report (TGR) has learned that executive search firm, Spencer Stuart, is guiding an effort to find a new CEO at Nokia, the Espoo, Finland-based phone manufacturer. One of the firm's market leaders, Jim Citrin, is reportedly leading the search for Nokia's board yet directly refused further comment earlier today.

It should be noted that "learned" and "reportedly" are not the same as confirmed. Based on the firm's lack of official confirmation despite repeated attempts, we are reporting what we believe to be true vs. citing unnamed sources or "persons familiar with the matter."

This marquee assignment further illustrates Spencer Stuart's hold on major search and advisory work at the Fortune 500 level. Tracing back to last year following the market crash in late 2008, the firm has handled several of the more consequentially perceived board/leadership makeovers at GM, AIG and Citigroup. A Wall Street Journal article published last year reported that senior-level members of the Obama administration suggested calling one of Spencer Stuart's top recruiters, Tom Neff, directly on the GM situation. That effort led to the selection of former AT&T Chairman and CEO Ed Whitacre as the company chairman, and then CEO of the newly re-organized company.

Stay tuned for more coverage on who may fill the Nokia CEO position, and perhaps more importantly, what the selection of Spencer Stuart may mean to Nokia's current board composition. Here's a teaser:

According to governance guidelines on the company's web site, http://www.nokia.com/about-nokia/corporate-governance/board-of-directors, the board currently comprises 10 members with nine non-executive directors who are "independent as defined by Finnish standards." That same number drops to eight, according to "rules of the New York Stock Exchange."

At Nokia's annual meeting held on May 6, 2010, the board's independent directors elected Jorma Ollila to continue to serve as chairman and Marjorie Scardino as vice chairman. Scardino formerly served as chief executive of the Economist Group (1993-1997) and has been CEO of the Economist's owner, Pearson PLC, since January 1997.* Ollila formerly was Nokia's CEO (1999-2006) and currently serves as chairman of the board of Royal Dutch Shell in addition to his chairman duties at Nokia.Out of the non-executive director slate, only Scardino currently serves as CEO of a major company. This fact, combined with the selection of Spencer Stuart, suggests a further shake-up of the board may be in the works.





Left to right: Jorma Ollila, Marjorie Scardino and Jim Citrin (Credit: Nokia and Spencer Stuart web site photos)

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*Scardino's current role at Pearson is not listed on her bio under board of director information posted at Nokia's web site.

For every owner and brand steward

http://www.pehub.com/77098/hefner-sends-letter-to-playboy/

Every now and then a major business owner will stand up for what he or she thinks is in the best interests of the brand. This doesn't happen very often and rarely if ever does it occur at the Fortune 500 manager or glorified CEO level. Playboy majority shareholder and founder Hugh Hefner is making a play to buy back the company that he created. Note the language (contained the attached link) directed at the brand vs. what the rest of us mere mortals tend to obsess about every day. I can hear the wise cracks from here, but for today, the TGR's hat tips to Hef. What a great American icon!

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Giving credit where credit is due

So the BP board has taken action. According to their Chairman who appeared at the White House yesterday to make the following statement (and gaffe), http://http://www.msnbc.msn.com/id/21134540/vp=37736716&#37736716 the board has decided to:
1.) Postpone payment of the stock dividend for the remainder of 2010 and
2.) They've appointed (actually, the government has) what's called an "adjudicator" to oversee payments to parties impacted by the disaster. None other than Ken Feinberg who is perhaps best known for handling monetary relief efforts following 9/11.

These aren't exactly bowl us over with great action moves but they're moves nonetheless. If you do manage to watch this clip, feel free to chime as in the "little people," which must be what the Chairman meant. Long way to go before we sleep on this thing called leadership.

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Live blogging the oil bigs

It never ceases to amaze how much selfish self interest continues to rule the executive ranks. This morning's testimony by the oil industry big wigs screams for a better message. The testimony, which the Times reports on here: http://www.nytimes.com/2010/06/16/business/16oil.html?ref=business, begs for acknowledgement of at least one reality: Whether they like it or not, BP's mess is their mess -- just as it is the government's mess. Executives can wax on all they want about "competitive advantage" and "higher safety standards," but until they wake up and accept this disaster-based reality, then the industry will remain -- pardon the pun -- forever mired in the mud. Is it too much to ask for someone to step up and lead here?

# # #

BP: Same old questions, no better answer

As Day 52 passes on the nation's worst-ever environmental crisis, it's time to understand how leadership situations such as this one are allowed to manifest into full blown disasters.

This posting will not attempt to do what the legions of other more talented hands have done to encapsulate events. No individual blame will be placed, no screams will be made for heads or CEOs nor will any investigations ensue. It will simply ask a few questions and then attempt to provide deeper perspective from both known facts and sources who work with corporate boards vs. opining from inside universities and think tanks.

And the question is...Where was the British Petroleum (BP) board when this crisis first happened? Followed by...What was or has been their response since then? Finally...how does what's known today inform future actions?

First, it should be noted that as bad as this operational crisis may be, what's always far more telling is how a company responds to a crisis. Going back to the worst domestic non-response case of all-time, Three Mile Island, letting the phones ring off the hook for days is the obvious worst while deft handling of the Tylenol crisis continues to rank as the most effective. Where the BP case study ends up will depend heavily on a final, still to be resolved outcome.

Back to the main question: Where was BP's board? Looking over the company's official communications, since the explosion on April 20, at least 50 releases have been issued. Other than a joint statement between the Chairman and CEO on June 4, no board position has emerged nor has any communique indicated what the board has been doing since the outset. It's unclear how many board meetings have been convened nor is anyone at BP willing to confirm an official number. It should be noted that this is normal behavior. Boards generally speak as one through their Chairmen and CEOs and meet quarterly or more as issues demand.

Our view, however, is that this situation is anything but normal. In fact, had the BP board decided to openly challenge the validity of what management was telling them at the outset, chances are the leadership criticism would not be as severe. Even despite the 700,000+ gallons of oil spewing forth killing wildlife and scaring everyone to the height of "Jaws," the movie.

BP directors have no further to look than themselves (for a listing of the 14-member board, which includes six internal directors and seven non-executive types, go to http://www.bp.com/managedlistingsection.do?categoryId=9021801&contentId=7040608) and the rash of governance ineptitude during the market collapse of 1998 for a guide on how not to act. Back when the financial system was in a free fall, not a single board member at Lehman Brothers or Merrill Lynch came forward to ask tough questions. Or at least they didn't publicly. Chalk another one up to attorneys who now manage the personal matters of board members as closely as their corporate clients.

Put more simply in the BP case, even if the board has been deliberating about whether to replace CEO Tony Hayward, what good is it to do so without full transparency? Especially when the company has already lost its reputation and a third of its equity value. Look at this way. Hayward could be the second coming of Jesus Christ right now and it wouldn't matter. The system that led to the current response is what needs changing, not the talent. A single governance standard across cultures might not hurt either.

The worst duplicity may lie in the fact that a majority of Fortune 500 board members tell public surveys that reputation is extremely important, yet when the proverbial blank hits the fan, they somehow develop amnesia with their own rhetoric.

This typical governance pattern is unacceptable during a crisis turned disaster. Real or perceived, nothing ever changes during a time when people are livid at institutions and want better solutions. Instead we're treated to heightened rhetoric and the blame game while Rome burns. Or in BP's case, while rescue workers wash oil off pelicans, and tourism officials rush to assure vacationers via promotional ads while oil sheens gather off the coast line.

Speaking of self interest, where are ExxonMobil, Texaco and Chevron? Couldn't their interests be BP's interests at this point? It's amazing that industry hasn't realized what the rest of us now know: Public opinion will never return in their favor no matter what happens. BP's crisis is now a national crisis, which means industry has lost another generation. No cagey spin can reverse this trend, which originates in the mismanagement of enterprise-wide risk, a key board competency.

The final takeaway here is that while reputation can obviously vanish overnight it's generally a slow crawl of leadership incompetency up to that point. With typically a raft of characters floating nearby who could have stepped out of their "best and brightest" institutional suits to demand something better. It's the least anyone could do to help improve a system that remains mired in outdated, group think behavior.

Heck, if nothing else, as a wise friend suggests, why doesn't BP just start giving away free gas to the Gulf's fishermen? To borrow a mangled phrase from a maligned former U.S. president, that's just common sensical!

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Scary stuff

Thanks to today's PE Week Wire and First Read contributor, Michael Snyder, we've now had our quarterly dose of economic reality thrown up on the home-based office screen. I wish I could say it's positive.

Warning: Grim fact-based reality about where things stand can be found at http://www.blacklistednews.com/?news_id=8878.

Recent gyrations from Europe aside, the so called recovery obviously has a long ways to go.

What's the new normal?

Dear Clients and Colleagues:

There's a new default mode in the marketplace. It's called the "New Normal." You may have already seen the term cropping up in reporting on the financial sector.

It's not clear what New Normal means or if there's anything substantive behind the term. Chalk another one up to media creation. Here's our take. New normal seems to describe a new place that some have arrived at following the Great Recession. Just don't ask them to tell you what's behind the "at."

What the saying points to is the continuing need for businesses (and their leaders) to find better narratives describing what they're doing or trying to do. After what's happened over the past couple years, there's little excuse left for an organization not to tell a better story. Yet fear of the unknown, anxiety about what's going to happen next and refusal to accept change continue to permeate behavior in the marketplace -- even despite signs of tenuous improvement.

You'll be comforted to know that there's now a better way to overcome this challenge. We are here to help tell how what you and your firm are doing can translate into better narrative with key constituencies, such as customers or clients.

While this may sound like an overly inward creative exercise, the truth is it's not. Effective narratives are only as relevant as what outside audiences want or need to know. The second truth is the normal tools such as press releases, canned speak, resumes/bios/CVs, Linked In updates and Tweets leave much to be desired when it comes to high-impact story telling. That's not taking anything away from all the channels being on; more to the point, it speaks to content that goes into the channels.

Consider a consultation if you're interested in learning how a process can work from a senior leadership POV. We will walk through the steps required, what a final product can accomplish and costs associated with the exercise. Here are several inflection points for when a new story typically has the most value:

1. Job and/or career change
2. New leadership position
3. New business strategy/direction
4. More actionable vision and shared values among a team

Thanks for your continuing support. May the New Normal exceed all previous expectations.

All the best,

JG

Jeremy Garlington
Point of View
Phone: 404-606-0637
Email: garlingtons@msn.com


P.S. If this doesn't interest or appeal to your needs right now, please consider forwarding the message to a senior-level leader who you think could benefit. Only personal one-to-one action makes a difference.

# # #

Childish or Churlish?

So by now we all have our own POV about Wall Street, financial reform and the current standing of the bank otherwise known as Goldman Sachs.

No matter what we may think or believe individually, what passes by in the public square never ceases to amaze.

The latest case in point comes courtesy of a private equity executive who probably will wish that he wasn't quite as candid as he was after reading today's New York Times' Dealbook column, http://http//www.nytimes.com/2010/04/27/business/27sorkin.html?ref=business. Then again maybe he will simply rationalize the view deeper as fact. Who knows. Here's an excerpt:

"I don't want to use the word childish but...it's childish." That's how Kenneth Griffin, the founder of Citadel Investment Group described the Security Exchange Commission's decision to pursue a civil fraud case against Goldman for their role in creating a sub-prime investment that went sour...

Classic. I don't want to but will thanks to my vaulted position. But wait, it only gets better. Here's another excerpt (we strongly suggest reading the piece in its entirety for context.)

"...I think the Goldman case has clearly energized the Democrats with respect to passing the regulatory reform."

Fair enough. We're all entitled to an opinion. The fatal flaw in this type of thinking though is how it tends to create conspiracy theory. Follow the logic and see if you agree or disagree. By adding this last line, Griffin seems to be saying that the fact the SEC took this action means that political fallout and momentum behind reform legislation will increase. That may be the case, but by connecting two separate events, the belief now trickles into the widely mediated territory of fact. It also does not acknowledge any resemblance of fault by the original party, which in this case, is Goldman Sachs -- not the SEC or efforts to reform the system.

For another example that now seems like decades ago, consider the original case for the Iraq war, which unsuccessfully attempted to implicate Saddam Hussein with the 9/11 tragedy.

The gray area between fact and opinion is where efforts to solve a problem get horribly off track. To borrow an age old line, don't let facts get in the way of a good argument.

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Good paying work for Junior

Remember when we used to mow lawns and do odd jobs as kids? Those days seem to be gone forever in the executive sphere based on revelations from the banking pinata known as Goldman Sachs. See http://dealbook.blogs.nytimes.com/2010/03/22/the-perks-of-being-a-goldman-kid/?ref=business Pay levels and perks aside, did anyone stop to think how these revelations would play publicly following the Crash? Here's hoping Jon Stewart and the Daily Show have a funny take so we can laugh and move on. With health care now done, it's on to the financial sector.

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Why CEOs should not blog without facts

When the CEO of an acquired company starts saying things like, "are you ready for a brave new world?," employees know it's time to take cover underneath their desks. In the case of John Brock at Coca-Cola Enterprises (see the AJC's report, published earlier today at http://www.ajc.com/business/coca-cola-enterprises-ceo-382024.html,) it's our sincere hope that he and the acquirer, The Coca-Cola Company, can level with employees and cut through the happy talk. Information travels at the speed of light, and fortunately or unfortunately depending on your view, sheltered executives tend to be behind when it comes to understanding sentiment. Blogs in this context only amplify what's already unknown, versus providing context around what is known. Add in the greatest levels of fear and anxiety since WWII and you get an environment that demands truth, not rosy talk.

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Passion of the Work

Blogger and entrepreneur expert Ben Cansocha posted a great feature earlier this month on the fallacies of working with passion. He cited a seemingly contradictory excerpt from Steve Jobs' now famous commencement speech first given at Stanford University and now passed along on the Internet like a prosperity gospel. Here is Ben's post followed by an updated POV:
http://ben.casnocha.com/2010/01/the-contradiction-in-steve-jobs-famous-commencement-speech.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+ItsLikeBensBlog+%28Ben+Casnocha%27s+Blog%29

Let's try a long winded question that cuts to the chase: How many people do you know who both love what they do, make lots of money, lead a balanced life and view their work as the primary channel of their "passion?" Is that your final answer?

Here's an updated view on the work with passion adage. Take it from someone who has now seen it from all sides: Personal experience, professionally helping others with similar issues and seeing through the views of everyone else inside the career complex.

Passion only takes things so far in the marketplace. You can be really good at something that you love to do and not receive adequate compensation due to factors out of your control. That's generally when the tough get going and find ways to adapt to meet need, which is always easier said than done. Some suspend passion and find ways to get through the lows of not being able to apply it as fully as originally intended. Consider Walt Disney and his many mini-foibles with animation and theater decades before Disney World ever existed. Others simply re-channel passions in other areas, such as hobbies, causes or ministries. Steve and Jean Case, Bill and Melinda Gates leap to mind here although admittedly those are some real stratospheric surface-oriented examples where passions follow great fortune.

Despite great commercial success, Goliaths such as Jobs have had to toil hard in the lab at times. Most business artisans view working with passion as a continuous series of experiments that may or may not have million dollar outcomes such as IPods or IPads. Taken in this context, maybe working with passion is a lifelong endeavor similar to faith? Who knows. What we do know is that the professional career complex latched onto this one during the go-go days of the Dot Com era. Those days are gone, yet the "work with passion" mystery remains. Beware of anyone who says they have this one figured out. Because they don't. It's simply not a black and white issue as painful as it is to admit.

I once posed the Passion question over a lunch with a prospective client who happened to be a mini-Hollywood mogul at the time. "So what's your passion?" He looked at me like I was crazy. Rephrasing the question, I tried another approach, "what gets you up in the morning?" His response, "I don't know. I've never had trouble getting up in the morning." Sold! Once he gave that response, we knew we had him on the hook.

If anyone would care to debunk this mystery further, please be my guest. Just please leave a few dollars on the blogging pillow.

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Bold truth -- from an unlikely source

Rarely has a bold truth come ringing out of a Sunday talk show during the holidays. And rarely have so few words implicated so many with such little fanfare.

As the usual year-end imagery gathers on TV and the Internet, it's highly unlikely the comments of Massachusetts Gov. Deval Patrick will make the final cut. That's too bad. Because what Patrick had to say about the past 10 years has deep implications for the next few.

Appearing on "Meet the Press" alongside New York Mayor Michael Bloomberg and pol Newt Gingrich, Patrick summarized the first stage of the new millennium as the "self deception decade." Y2K, threat of terrorism manifested by Sept. 11th, two wars fought on the cheap, housing/Wall Street bubbles, etc. Whatever we spent or did then was put off for tomorrow. Patrick predicted that the coming decade will be when we finally get honest and deal with the "intractable problems facing society."

Fair enough, Governor. You're a smart and admirable point-of-view public figure. But what you said strikes to the core of a much deeper issue that no one seems able to address -- much less solve.

A vast majority of leadership elites have grown to believe their own deception, making real connections with followers fleeting. Trust and confidence have been thrown out with the bath water. Innovation -- which Patrick said will characterize the coming decade -- gets tossed around in conversation like a worn out bromide while little changes. Consider the evidence. Government, despite a transformational president, remains the same both symbolically and systematically. Two of the recession's hardest hit industries, autos and banking, continue to maintain the status quo as evidenced by events at GM and Bank of America Corp. "Going green" remains just that as even Bloomberg confessed by saying "no one knows what that means." How the green movement hasn't been effectively connected to eliminating dependence on foreign oil tells all you need to know about how special interests engulf the present system.

Elites have grown oblivious to their own deception for a range of factors -- most center on self glorification vs. productive difference making on behalf of others. Case in point: What just transpired between Congress and the White House on health care reform. Note: This is not a policy indictment; more to the point, it's about acting above board when no one trusts what you're doing. Equal offenders from the political and business realm line both sides of this issue.

Huge sums of money also feed the beast called deception. A billion here, a billion there. No amount is too small. It's almost as if Monopoly money is being exchanged for derivatives to be paid later. Leaders have forgotten that it's the public's (taxpayers' and shareholders') treasure that they're manipulating for selfish personal gain. No accountability leads to zero correction; cycle continues. The passing of Sen. Kennedy over the summer served as a stark reminder of what a lifetime of public service entails. It's too bad his legacy has already been shuffled away in the Senate's coat closet.

Fortunately, or unfortunately depending on your view, the public is way ahead of the deception. They're furious, anxious and often perceived as irrational, which means they are irrational in a heavily mediated world -- or whatever passes for the nightly news.

The real question is what can be done. There are no easy answers, but it begins with calling out the issue. It's too bad we can't assign TMZ.com or the "National Enquirer" to the story because they would get to the bottom of the barrel in a hurry. Facts or no facts, the tabloid media, YouTube and other new outlets such as Twitter have a way of cutting through to the unfiltered core faster and better than anyone else.

Which brings us back to the future. Before we go further into the "honesty decade," as Patrick predicted, there's still a fair share of flushing out to do with the deception decade. Which means we'll probably keep throwing the bums out of office and tossing stones at CEOs in glass houses while little gets done. Some things don't change.

The only way to make a difference is by taking personal action and encouraging others to do the same. Not everything has to be about ME! Granted, until there is a sense of collective We, it's awfully hard not to look out for A-1. Especially when things are upside down economically.

Maybe the next 10 years will turn out to be the "Me to We" decade? Probably not. 'Mewee' sounds like a dumb Charlie Brown character. Oh well. Back to the drawing board for now. Welcome your ideas on a better name.

# # #

Introducing the new Fleet BofA

Well, at least it's done. Bank of America Corp.'s board whiffed by selecting an insider/outsider, but thankfully, the publicly bungled succession process is finally over. Look soon for spin on the new Bank of America, which will resemble the old with a new "fleeting" influence. 'Fleeting' is a bad play on words referring to the strong influence of three former Fleet executives who currently sit on BofA's board and the new CEO, Brian Moynihan, who also formerly worked at Fleet. More things change, the more they stay the same. Prediction: The bank's board will be shopping for another CEO within a year's time.

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BofA: Where's the new CEO?

The Bank of America Corp. (BofA) CEO search drags on. First the board said through a spokesperson that they were going to have a candidate in October. Then Thanksgiving came and went. Now the deadline is first quarter 2010. According to the Wall Street Journal, the bank's board is meeting today but they likely will not be naming a new CEO. So what exactly are they doing: Hanging the stockings with care?

While the board deliberates, the usual vacuum gets filled with everything from potential candidates who won't take the job to how the bank paid back TARP money so they could attract the right CEO candidate. Pardon the blunt dismissal, but this latest mainstream revelation is dumb. No one at that level is going to make their decision based solely on money, and if they were, then they're not suited for what the job requires.

Managers take jobs because of money; leaders take jobs because of the ego-based challenge and then the money, which when you're a candidate for the top job at the nation's largest bank assumes you don't need a paycheck every 15 days. Of course this assumption could be wrong like most of the others during the Great Recession. But the rule generally holds true at the top rung.

Let's review a few key qualifications since the basics seem to have lost more interest than a C-SPAN rerun. Sooner board steps up, obviously the better.

1.) Proven leader, not another manager. The new CEO needs to be someone with gravitas and proven ability to navigate constituencies that some believe now poison the bank's dry well: Government regulators, Obama administration officials, investors and previous owners (latter two are one in the same but sometimes it's difficult to tell.) For anyone that still believes that the new hurler in chief will be a qualified manager from the inside, recall the baseball song about belly itchers and relief pitchers. One does not preclude the other. If that doesn't suffice then consider what the WSJ's Intelligent Investor had to say about the difference a new CEO makes in a company's profitability: http://online.wsj.com/article/SB10001424052748703735004574575880529756434.html?mod=WSJ_hpp_sections_personalfinance
Preview of answer: Not much. Difference is little more than a coin flip.

2.) Able to lead and build credible consensus in a new direction. The previous occupant, Ken Lewis, comes from the old command control school where oddly the new darling, GM Chairman Ed Whitacre, came from as well. That's not going to cut it. Key question: Who can marshall the capital, both human and financial, combined with the right strategy to move BofA forward in not only a different direction but an entirely new operating environment? Trust and confidence weigh heavily here but don't try telling that to the board, which hasn't exactly used this transition period to build either quality.

3.) Character as a tangible vs. intangible requirement. Okay, don't roll your eyes. While this qualification gets thrown around more than a bromide, reputation does matter. Or at least it should in this case based on the former occupant's behavior. In his "Eighth Habit," Stephen Covey cites a stat. that lends credence here: 90 percent of all leadership failures are due to character. Flaws, break downs, sacrificing values, etc. You would think that whoever takes the top job at BofA will need to be squeaky clean and politically astute. And no, those two qualifiers don't represent an oxymoron.

Good luck, BofA board. We look forward to hearing from you directly sometime through your Chairman or search firm. Tick-tock, tick-tock.

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Single holiday wish

Last week's headlines in The Wall Street Journal presented an all too familiar trend line. First came AIG's CEO complaining about pay restrictions while threatening to quit after only a few months in the job. He later retracted and said he was staying for now. Evidently the "war for top talent" rages on to the point where even a leader of a too big to fail enterprise feels compelled to cry wolf.

Then came reports of another candidate for the Bank of America (BofA) CEO job turning up his nose because reportedly $34 million in stock paid in another deal would not be paid out in full if he took the BofA position at a lesser grade. Why someone would view the position as just another notch in the money belt is more instructional than it should be. Evidently restoring credibility at the nation's largest bank and earning career making chops that goes with doing so aren't worth the advertised compensation.

Ah, yes. Unchecked self interest continues unabated in American executive circles. What a way to end the year during which many have lost but few have gained. I can hear the cries now, "But why shouldn't he command the most money? Aren't you a capitalist? Since when did the government start setting private sector pay levels -- that's SOCIALIST!"

Fair enough. Argue away. It's a free country. Just be sure to see both sides.

The message here is not about government control vs. impinging on capitalism. Far from it. That argument is way above our pay grade any way.

It's a simpler holiday wish: That those who continue to act exclusively in their own self interest (Hint: All of us at one time or another) reach out beyond themselves and lift up a fellow man or woman in need.

That could be as dramatic as helping someone in trouble, hunger or sorrow or as common as providing a personal endorsement to someone else who might qualify as a new potential customer or boss. Oh, and this means actually doing so directly, not writing a bunch of canned lullabies on Linked In.

If that all sounds too Pollyanna, then look at it this way: It's not just about my house or his house. It's about OUR house. This is as much a collective leadership message as it is request to act in a greater interest. If nothing else, can we at least set aside the market-based quid pro quo stuff for a couple months?

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Two Chicago Guys and a CEO Search

Left to right: Walter Massey (courtesy, AJC)
Charles A. Tribbett III (courtesy, Russell Reynolds web site)


Bank of America Corp. (BofA) Chairman Walter Massey has named Charles A. Tribbett III of executive recruiter Russell Reynolds to assist with the recruitment of the bank's next CEO, according to people familiar with the matter. Efforts to confirm Tribbett's selection with a firm spokesperson were unsuccessful as of 5 PM EDT. News of the recruiting firm's appointment minus the personal name of the lead recruiter was first reported earlier today at http://www.wsj.com/ -- http://online.wsj.com/article_email/SB125545433529782763-lMyQjAxMDI5NTE1MzQxNTM0Wj.html

This decision signals deep local ties between two power brokers while underscoring the emergence of Chicago as an epicenter of influence in national political and business affairs.

It also sends mixed signals on whether BofA will consider internal candidates for the CEO position following previous reports speculating on where the bank will turn for talent.

Tribbett is the Chicago-based, domestic co-head of the CEO and board practice for privately held Russell Reynolds. Prior to joining the firm in 1989, he was a partner with Abraham & Sons, a private investment management and brokerage firm in Chicago. Tribbett also served as a corporate securities attorney with the law firm of Skadden, Arps, Slate, Meagher & Flom. He currently serves on the boards of Northern Trust Bank, Chicago Symphony Orchestra and the Chicago Council of Global Affairs, an "independent non-partisan organization" representing a Who's Who of Chicago, including First Lady Michelle Obama who is listed as a lifetime director on the organization's web site.

In addition to his chairmanship at BofA, Massey serves on the board of Oak Brook, Ill.-based McDonalds and is a trustee at the University of Chicago. He also formerly served on the board of Delta Corp. and First Chicago Corp. after a series of executive positions in higher education. According to the Atlanta Journal & Constitution http://www.ajc.com/business/massey-s-final-bank-159534.html, Massey and his wife, Shirley, currently live near the University of Chicago and the Argonne National Laboratory where he served as director.

It's not entirely clear where Tribbett will look to fill the CEO position of the nation's largest bank based in Charlotte, N.C. But one thing is clear: A closely related web of board and civic relationships between Tribbett and Massey will strongly inform who ultimately fills the position. Always has, always will.

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BofA: Will grits remain thicker than water?

So week two drags on with the Bank of America Corp. (BofA) governance mess. The bank and its board remain under attack from every conceivable angle, leading to snap decisions such as on/off the shelf "emergency CEOs" that few understand much less believe to be part of a real solution. Mainstream media continue to speculate on the horse race or who will fill the role vs. what is needed to right the course.

Until someone steps up and actually says, "Stop, wait a minute! We're headed in the wrong direction," nothing is going to change. Which unfortunately means, for viewers of similar movies, nothing will change about this one's ending. Not even the credits.

Call it board leadership 101 failure for lack of better terminology. Nothing good happens when a gun is held at someone's head -- at least from a non-criminal point of view.

This reactive vs. proactive stance points directly to a deeper set of questions that needs to be answered before going any further in the CEO selection process.

Will BofA continue to be defined by an aggressive southern culture created by Hugh McColl and then leveraged by Ken Lewis? Is it time to turn the history page and step up as the nation's largest and most responsible bank in the post-collapse era? To borrow a witty phrase from a friend, will grits remain thicker than water?

None of the internal candidates publicly identified so far represent the bank's current culture yet BofA remains largely known by its Charlotte way of doing things. This fact leads to even more questions: Should the bank shutter its headquarter roots and move to New York where it can deal with regulators and other constituencies more directly? Will the new CEO have the external chops to deal with what's most important vs. urgent, or will the bank sink into the quagmire of a quasi-governmental agency?

No one, including board chairman Walter Massey, has stepped up to demonstrate a firm grasp of these issues. Every move so far has been bureaucratic in nature and defensive considering what's at stake. Sending signals that it will likely turn to an inside hand to stir the grits is hardly bold action. Nor does it make much sense unless they're not serious about change, which is always a real possibility.

Heck, even the now defunct GM board delivered clearer signals when they were slipping toward bankruptcy. BofA remains solvent, profitable in some business lines yet severely leadership challenged at the top, which is generally where it counts the most. Meanwhile, competitors such as JP Morgan Chase and Citi are licking their chops.

Here's hoping BofA deals with its leadership issues in a manner befitting a large corporation. If they can't, then owners should be demanding better -- across the board.

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BofA: Let the horse race begin

Publisher's note: The following was first published today on BusinessWeek.com under their ManagementIQ blog heading. Find the direct link here http://www.businessweek.com/careers/managementiq/archives/2009/10/moment_of_truth.html. Or feel free to read on below.
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Whoever fills the CEO role, while sexy and headline grabbing, is not the most pressing need at the nation's largest bank. What's more important is how the BofA board decides to proceed with righting the bank's leadership course. This obviously includes the coveted prize, a new CEO, but to emphasize that decision at the expense of other more important matters represents bad governance. It also underlines the misguided longly held belief that great talent will solve everything.

Following are several steps that the bank's board should be considering if they're not already:

1. Replace the Chairman. Board Chairman Walter Massey is now inextricably linked to the former regime as a result of ongoing litigation, government investigation and personal relationship. This is a perceptual non-starter. It also represents a serious first challenge for the board to answer. Massey's tenure has been brief and was given rise to a previous crisis wave when investors forced Ken Lewis to sacrifice the Chairman title. The law of unintended consequences has been cruel here so far. Whether Massey can help right the course when he himself is under attack should be the board's first order of business.

2. Find a way forward, or out, of the regulatory and judicial jungle. New CEO or no new CEO, BofA needs to move expeditiously with trying to reach settlements across the board on all current legal matters. This may sound too ideal or pie in the sky. But even a better faith effort would send a stronger signal. Within this effort also lies a key competency for a new CEO. At least three quarters of the current leadership mandate is making sure the cloud that currently engulfs the bank is lifted.

3.) Consult Jamie Dimon at JP Morgan Chase. This step is more search-driven than strategic, but it's a practical step that only the truly hubris free will consider. Dimon has led an extremely successful, similar sized operation during a similar period of upheaval. No one else has the same knowledge or experience to deal with what faces BofA. To not consult Dimon on who he thinks would be a gross oversight. You can be assured of at least one thing: Whichever high end recruiter gets the assignment will take this step while simultaneously trying to woo talent away from underneath Dimon's nose.

This isn't about wasting a crisis or trying to bring Superman to lead the nation's largest bank. It's about doing what's right in the wake of months of misdeeds and leadership inertia.

If there is a silver lining, it's the fact that BofA's business appears to be on better footing than a year ago when the system collapsed. Yet unfortunately in this case that also speaks to a bank's greatest self perceived advantage: Time. Time to recover. Time to take more government money. Time to see assets come back. The more time a bank has, the longer it can live. Vice versa, the longer it can continue to do nothing and watch its once vaulted status nose dive into the abyss. Any of the major banks that neglects this consumer reality does so at their peril.

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BofA Chairman forms search committee

Bank of America Corp. (BofA) Chairman Walter Massey has formed a search committee to find a new CEO to replace Ken Lewis, according to people familiar with the situation.

Two executive search firms, Spencer Stuart and Heidrick & Struggles, reportedly are in the running to present qualifications to the committee. Spencer Stuart has been working with BofA on board selection matters since earlier this year. Heidrick & Struggles has assisted the bank with management selection and recruiting senior-level managers over the course of the past decade.

BofA has added nine new board members in 2009, replacing former directors such as lead chair Temple Sloan and (Ret.) Gen. Tommy Franks with new members, including Dupont Chairman Charles Holliday who was named last month and four other directors who were named in June. This follows the addition of three new Merrill directors who joined the board in January. The bank also recently hired former Citi executive Sallie Krawcheck to run its global wealth management and advisory business while also consolidating several other senior roles in the bank's global consumer and investment units. Whether Krawcheck will be considered as an internal candidate to replace Lewis as CEO remains unclear.

The bank has no official CEO succession plan in place, nor does it have a contingency plan should current management face indictment as a result of ongoing litigation. Both Lewis and Massey have been subpoenaed in an ongoing investigation into the Merrill Lynch acquisition by New York Attorney General Andrew Cuomo. They also have been named as individual parties in an Ohio lawsuit, which seeks damages resulting from alleged misrepresentation of shareholder interests.

The combination of disarray at the highest governance levels, addition of nine new board members in a single year and the perceived taint hanging over the current day-to-day regime strongly suggests that BofA will turn outside the bank to find new leadership.

Whether that translates into a short-term or long-term CEO remains open to speculation until an interested and qualified candidate surfaces. Such a candidate will be expected to meet the strong approval of both the bank's overhauled board, key investors such as former Chairman and CEO Hugh McColl and the federal government.

BofA's two clearest options to fill the CEO post include:
1.) Bill Winters, former co-head of JP Morgan Chase's investment bank. Winters left Chase earlier this week following an executive shake-up. Winters played a pivotal role in the bank's success and had a birds-eye view of how his widely respected boss, Jamie Dimon, led during a similar period of upheaval. For a good summary, see http://blogs.harvardbusiness.org/cs/2009/10/what_the_jpmorgan_chase_shakeu.html. Dare we suggest Dimon himself to rescue the country's largest bank? According to the attached piece, his chief regret seems to be not serving his country. Ah yes, life is good at the top.

2.) Naming one of the current new "insider/outsider" board members as CEO. Spencer Stuart followed the same model at Delta when Richard Anderson was named CEO after joining the board prior to becoming the airline's top executive. This practice has grown increasingly common for boards and companies facing turmoil. Success depends largely on transparency and how relationships on the board coalesce around a chosen leader.

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ATL's non-teachable moment

Here's the latest POV from one blogger to another: http://saportareport.com/blog/?p=1748.

It continues to amaze how little behaviors change despite all the rhetoric, all the time on the subject of change. Atlanta and its ways are no exception. For such an easy place to live in, it almost does so in spite of itself.

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