CARAYOL BLOG

THE SHIFT TO THRIFT

noreply@blogger.com (René Carayol) — Thu, 14 May 2009 07:53:00 +0000

Background:

There was a time when people would choose a company because of what the company stood for. This was always to do with ethics, values and a great standing in the community at large. Most of all, these were values that most employees wanted to be part of.

Every proud parent would stay awake at night praying that their children would join an organisation that would look after them much in the way they had looked after them.

People were not after short term jobs. They wanted careers.

For those of us in the UK this meant firms like Marks & Spencer, BP, Unilever or Barclays Bank. In Europe it was the likes of Philips, Carrefour or Nestlé. In North America everyone was beating a path to the doors of Boeing, Procter & Gamble, GM or IBM.

They were "academy" businesses and all had striking similarities.

Academy Rules:

- Strong, market-facing brands
- Rock solid employer brands
- Paternalistic cultures
- Strong ethos and values
- Long average length of service
- Low staff turnover
- "Best in class" training and development
- Prominent staff welfare programmes
- Generous pension schemes
- Home-grown, "caring" leaders with a huge knowledge of their industry
- Strong recruitment processes
- Job circulation within the business - "15 jobs in 35 years"
- A string of non-financial perks (staff discounts, free dentist, interest-free loans, free hairdressing etc.)

Historically there were no financial bonuses but still the "best of the best" school leavers, apprentices and graduates would dream of working for one of these organisations.

And if you did get in you never left.

Every employee became an ambassador for the business and was proud to show off their business cards at every opportunity.

The Quarter Culture:

The increasing demands by city analysts for rock-solid forecasts of quarterly earnings, followed by a myopic stranglehold on the delivery of those forecasts, has created an environment that has long since replaced this model; the quarter culture.

The only perceived measurement of success has become the delivery of quarterly targets and in recent years this has moved from being a guideline target to an unhealthy obsession and blood commitment of the board of directors.

Far too many industries leave behind any form of common sense, business acumen or compassion in the week the quarter finishes and it has created a generation of customers who wait until the last few days of a quarter to get the best deals out of desperate sales people.

More businesses than ever are run on a quarterly basis and to reinforce these heavily structured deliverables, targets, behaviours and thinking, we have witnessed the rise and rise of the quarterly bonus.

Even if bonuses are paid annually, they are normally the aggregation of quarterly performance ratios.

For the very short term this seemed to establish performance cultures where people seemingly moved faster, delivered more and fostered a "can do" attitude.

But the reality is that it killed team playing and collaboration, announced the promotion of the individual, destroyed humility and eventually brought down business after business.

Investment banks showed it at its most acute. People became obsessed with delivery over quality; creating corrosive problems such as sub-prime mortgages and toxic assets.

Even worse it saw the re-emergence of replicas of Wall Street's Gordon Gekko, even down to his memorable mantra, "greed is good".

Something has to give.

Built To Last:

Many people hark back to the "good old days" and we are usually the first to dismiss nostalgia and encourage all to escape the pull of the past.

But the current global recession is telling us to think a little differently. And in this case differently means looking back to look forward.

When a business is in serious trouble we always get them to go back to a time when the business worked well and then understand what has changed.

For many of our great global institutions, they need to go back to their time as "academy" businesses.

Just look at two topical names - BP and Woolworths.

Under the last days of Lord John Browne, BP lost its moral compass; it became a little too arrogant and big for its boots.

They allowed their marketers to go just a step too far and when they changed their name from British Petroleum to Beyond Petroleum.

People just didn't believe them; their green credentials simply didn't stack up.

The culture meant that people on the inside were too scared to speak out whilst the business' values moved further and further away from those of their customers.

In short, nobody knew what BP stood for anymore.

When Tony Hayward took over he put BP back on the path they used to tread and went back to where they came from. He positioned the business to take advantage of its strengths and made no hiding of the fact that BP is a petroleum company.

And a very successful one at that.

Investment in new technology such as wind farms and solar energy was no longer seen as proof of BP's green credentials but as a necessary eye on the future to ensure its survival and competitiveness.

Behind the scenes and BP is inexorably returning to an "academy" business once more.

Woolworths never took the look backwards.

By the time the retailer came to its predictable demise, nobody knew what it stood for; be it the leadership, employees or customers.

There was only going to be one result.

Both passed our "academy" rules during their golden trading periods but whereas BP took the time to change, Woolworths kept blindly following the quarter culture just because it was "the thing to do".

Unilever:

The new CEO of Unilever, Paul Polman, recently dropped issuing financial targets and suggested the company may do away with such guidance permanently.

"I just happened to be the first one (to drop financial targets), but the amount of correspondence I got from many people in the industry was quite encouraging," he said.

"Many would privately say, especially American companies: 'I wish I could do that' ... the move to have less targets (externally) is not an unhealthy thing.

"I think it would be a good thing for the world if we formed new habits, and (avoid) chasing our tail, especially in businesses that are seasonal."

L'Oreal has since followed Unilever and with it the first steps are being taken to change the culture and revert to a different way of doing business.

But you don't have to be a huge multinational or conglomerate to have rock solid values and ethics and a strong ethos.

Every business can be an academy business.

It just needs inspired leadership to drive it through and a vision that is shared throughout the company, but most of all, values that all believe in and practice.

Perhaps the time really has come for a profound change in the way we run our businesses again.

What does your business stand for?

THE HEIR UNAPPARENT?

noreply@blogger.com (René Carayol) — Tue, 31 Mar 2009 09:33:00 +0000

There’s an old saying that when the sea is calm, everyone is a great sailor. It is only when the storms come that real leadership counts.

Put another way, people show their true colours when under pressure.

The economic downturn that we find ourselves in makes for very choppy seas indeed and the difference between leadership and management is even more striking than it was before.

For management read strategy, process, procedure, systems, execution and an ever-increasing range of management tools such as league tables, balance scorecards and KPIs.

Put simply, it is about “making sure”. Whereas in the good times this was enough, in the downturn it isn’t. Management has become commoditised; everyone is doing it and most are doing it well.

Don’t get me wrong, management is crucial to run any business successfully but it is no longer enough in isolation.

There HAS to be leadership as well.

You’ve heard me say it plenty of times before but what has become increasingly apparent over the last few months is that leaders who are brilliant in the good times might not necessarily be the best in the downturn.

My guess is that most things our Chancellor and Prime Minister are doing to end the recession are probably the right things to do but they just cannot inspire us to believe them or energise us to change our behaviour. This is because they are managers not leaders.

And micro-managers at that.

What we need now is a little less forensic analysis of the detail and far more vision around the big picture. That requires inspirational leadership.

The passing of the baton from Blair to Brown demonstrates everything that is wrong with succession plans hatched by the incumbent protagonists. How did the Labour party allow Blair and Brown themselves to determine the party’s future?

We’ll come back to that later.
The rules of engagement are changing and you only have to look at the average length of service for UK and US chief executives and you can see that they are shortening dramatically. It is now just under 4 years in the US and 3½ years in Europe.

Time and again we have seen some of the best people outstay their welcome and in the fast moving yet unforgiving business world we are living in, those organisations on top of their game are refreshing their CEOs regularly to keep current and up to date.

But still some of the best leaders hold on and have their outstanding reputations tarnished.

Thatcher. Blair. Lord John Browne. Sir Fred Goodwin.

Even from here I can feel football supporters shouting out, “but what about someone like Sir Alex Ferguson?”

Well, he proves a different point. Over the course of his illustrious career he has stayed fresh, vibrant and contemporary by regularly changing his deputy. In doing so, he has refreshed himself.

But importantly, his first four years at Manchester United were barren and it is not clear whether even this well run club would be that patient now.

When someone has been in power too long and finally gets deposed there is always an urge to replace them with someone who is the polar opposite, rather than selecting the right person for the job in rapidly changing times. For Margaret Thatcher read John Major, for Tony Blair read Gordon Brown, Mandela and Mbeki, Brown and Hayward at BP, Goodwin and Hester at RBS.

Despite everyone knowing that nothing stays still, there are countless examples of no natural successor being in place for when the time comes, especially when the leader has an air of invincibility. Most potential successors will not hang around long if they do not feel there is any chance of the boss moving on. Consequently, when the incident comes that finishes off the once great leader (and it will come) panic sets in and the resulting outcome almost appears to be pot luck based on the prevailing mood or having to “make do” with what is available.

We saw the mess at Chelsea when Mourinho walked out. When the leader appears to have it all, the organisation and its stakeholders seem to assume that golden eras never end, but they do, and how.

Succession planning is always seen as another management process.

But guess what? It should be about leadership.

In the army, leaders are always groomed and ready to step up to the plate if the leadership falls. So why can’t businesses and governments be the same?

Still there is a tendency at the very top of UK PLC to “recruit” the personnel for the top positions from the questionable talent pool of the “old boys club”, overlooking in the process the real issue at stake; growing the business and not lining the pockets of your old school pals.

Take a look at BP as we speak.

The company is recommending Sir Tom McKillop (an old friend and ally of current chairman Sir Peter Sutherland) be re-elected to its board despite Sir Tom’s record as the former RBS chairman who signed off Sir Fred Goodwin’s pension, failed to act on shareholder concerns over Goodwin, supported the disastrous takeover of ABN Amro and quietly contributed to the tarnished image that has engulfed the banking profession.

It is an appointment that can only end in tears for the reputation of BP.

Something has got to change.

So let’s start the relatively simple process right here with two golden rules.

Firstly, the current leader can’t pick the candidates. They simply cannot and must not have too much say. Again, look at the Blair / Brown transition on how not to do it. Secondly, the succession should be ‘owned’ at the most senior level possible in the organisation. It must not be left to HR. Of course they are an integral part of the solution but it sometimes demands a confrontation that HR would rarely win.

If allowed to make the decision over their successor, the current incumbent so often falls into one of two traps; they choose a non-threatening foil that sustains their own reign or they choose someone exactly in their own image.

Instead the process should be left to the chairmen or independent directors.

We can all learn something from the US Presidential elections; two strikes and you’re out with absolutely no say in who replaces you.

It’s a simple way of facing up to the fact that we have different leaders in different eras and just because they were once great, they might no longer be relevant.

In business the days of the twenty year boss, even the ten year boss, are long gone. And it’s not just in business that the sands are shifting; the days of a Sir Alex Ferguson-type spell at the top are never going to happen again. The likes of a Tony Blair ten year reign should never be ALLOWED to happen again.

The business market place is so unrelenting, aggressive and unforgiving that it needs fresh leadership on a more frequent basis. In fact, it needs to be forced; an eight year upper limit should be set.

But the current CEOs, MDs and leaders will not hear of such a move. People like Sir Fred Goodwin, Lord John Browne or Sir Stuart Rose have always historically surrounded themselves with people that daren’t suggest that perhaps their time has come.

Even the likes of the quite brilliant Steve Jobs at Apple should not be allowed to stay forever. His tragic illness has exposed a yawning gap at Apple.

You need instead to have a strong, forceful board that provides support, challenge and vitally, change.

Even then there are pitfalls. If you make the succession plan an open competition both internally and externally then it leads to a drawn-out turf war with bitter internecine warfare.

And when the winner emerges, they immediately kill all of their rivals. Again look at how Brown has decimated the cabinet he inherited. All likely and potential challengers have been quickly removed.

So what to do?

The clues have come in the downturn. CEOs are being ousted regularly due to bad results and falling profits, with no heir apparent. The immediate perceived sign of weakness, and a potential power vacuum, is quickly reflected in plummeting shares.

But look at the change at the top for the Prudential for an example of how it should be handled. The changeover has been grabbing headlines due to the new incumbent Tidjane Thiam being the first black CEO of a FTSE 100 company but underneath that landmark achievement the process has been immaculate.

The outgoing CEO Mark Tucker resigned unexpectedly after four successful years in the role, quoting “it was a tough thing to do but I’ve put into place many of the things I set out to do.”

Him departing on a high and leaving the company in good shape for a new round of fresh, innovative ideas was a masterstroke.

The market reacted positively to Prudential's results and management shuffle, with Pru shares soaring as much as 28 percent.

Kevin Ryan, an analyst at ING said it all. “The results were good and they gave a good account of themselves. I thought the markets would like Tidjane, he is better suited to CEO than CFO."

Succession planning doesn’t have to be a blood bath. It just needs to be done regularly, sensibly and not allow one individual to make all the decisions.

So now is the time to answer the really tough question that only the authentic leaders ask themselves – am I still the right person to lead this organisation? Why? Could someone do it better?

When I’m called into an SME that is struggling to get to the next level in the good times or fighting for survival in the downturn, it is essential that the toughest question is confronted early on. Why should these people be led by you now?

It is uncomfortable and bordering on rude but it is necessary and does not have to be aggressive or confrontational.

But it must not be avoided.

The entrepreneurial spirit, vision and courage of the founder are usually irreplaceable in the formative years. They generally put the necessary processes in place, hire the top team single-handedly and cut all the initial deals with all the suppliers.

It means that they tend to make all the calls and all the decisions, without consultation. As the business grows, the organisation will need bigger and better people who, in the main, will not respond well to a prescriptive and commanding style of leadership.

The same things happen in huge multi-nationals when the leader has been around for a long time and especially if they have been successful.

This then becomes the crucial time for the private fireside chat with a senior member of the top team or the ‘critical friend’ (the chairman or the non-executive director).

It is never easy but usually when pointed out forcefully and supportively, it tends to have the desired effect. Different environments demand different approaches and no one leader is right for every occasion, no matter how brilliant they have been in the past.

Is it time for a change at the top of your organisation?

At the time of this blog going to press it seems common sense has prevailed and Sir Tom McKillop has released a statement saying that he will no longer seek re-election on the BP board at the group's annual meeting in two weeks time, amid growing concern from investors.

THE LEADERSHIP VOID

noreply@blogger.com (René Carayol) — Tue, 20 Jan 2009 14:51:00 +0000

Whilst the UK took for granted ten years of almost uninterrupted economic plenty up until the unprecedented credit crunch and downturn of last year, few realised at the time that it was the confidence of strong and visible leadership that was underpinning our vibrant economy.

There were many things to hold against Tony Blair during his years as Prime Minister but leadership was not one of them.

Whether we agreed with or liked what he had to say or not, he could lead.

Many say that it was the only thing he was brilliant at but let’s make no mistake; it was due in no small measure to his optimism, vision and deft communication that the nation enjoyed this decade of prosperity.

He energised a nation away from inward-looking trade unions, industrial strife and dependency on the welfare state and picked up Margaret Thatcher’s baton of independence, self-sufficiency and free market policies.

Everyone wanted to invest in the UK.

From Abbey National, BAA and the London Stock Exchange to Jaguar Land Rover, Manchester United and O2, huge swathes of UK PLC have been sold over the last ten years to foreign investors.

But this was vital to Blair’s vision to make London the financial capital of the world and the results were there for everyone to see. The money never stopped pouring in as deals, deals and more deals were conducted at breathtaking speed with “light-touch regulation”.

Put quite simply, it was easier buying a business in Britain than in the US, Europe or any other Western economy.

This was wealth creation at its finest and even when there were hiccups along the way, Tony Blair was there to reassure us and tell us that everything would be fine.

And the ugly truth of the matter is that even when we didn’t agree with what was going on, we would look in our wallets or check our bank balances and everything would seem fine once again.

When the media were screaming for his head over the invasion of Iraq, the business community kept their heads down and said little; it marked the beginning of the tension between ideology and prosperity that we are feeling even more markedly now.

Because now there is a leadership void.

With Barack Obama filling that void and offering a new vision of the future for the US, it is imperative that Britain and Europe do the same. There is a leadership crisis and whenever there is an issue surrounding leadership you must go back to the last time it was right to fix it again for the future.

In the UK it wasn't that long ago at all.

During New Labour’s first two successful terms in charge we benefited from the dream team; the visionary, optimistic and clear communicator Blair leading the country and the solemn, taciturn and pragmatic Brown in charge of the treasury.

Brown was a great foil for the more risk-embracing Blair, as were the big hitters that made up the rest of the cabinet. From Robin Cook and Charles Clarke to Peter Mandelson and David Blunkett, all had their own ideas and were difficult to manage but easy to lead.

Times have changed considerably.

It is inconceivable that anyone who knows anything about leadership would have considered Gordon Brown as THE candidate for Prime Minister from such a collection of individuals and most now know that if Brown had gone to the nation in his early days for a vote then he would have failed miserably.

We are victims of a lack of democracy, as are many of our businesses. If you are ever in any doubt as to someone’s leadership qualities then put it to the workforce or nation; they will know what they need.

Tony Blair had an entrepreneurial spirit but Gordon Brown doesn’t. Therefore the outlook for entrepreneurs in 2009 remains bleak, for as long as Brown and Darling remain in charge of the economic direction.

With the business community screaming out for help at the end of 2008 they took the unbelievable decision to cut the VAT rate. It was ham-fisted, short sighted and reinforced once more the feeling that nobody in the cabinet “gets” business.

The lifeblood of any Western economy comes in the form of SMEs and entrepreneurs, and without suitable lending and overdrafts from the banks these companies and individuals simply freeze. The government has failed to act with any form of leadership or authority to get this situation to change and still the effects of the credit crunch loom over us for the New Year.

Darwinian forces always apply in business and we need entrepreneurs to not only create wealth but take the bull by the horns and act whilst the government continues to blunder.

Perhaps it’s time for entrepreneurs to help entrepreneurs.

We had a great experience at the Inspired Leaders Network last year when Brad Rosser, former right hand man to Sir Richard Branson and renowned business builder, was interviewed at one of our sessions.

At the end of the evening four or five budding entrepreneurs swamped Brad with their ideas. He has since gone on to become Chairman and shareholder for at least one of them and they are blossoming with his help; having shunned more conventional methods to expand in the downturn.

It is a model we must continue to adapt.

The “big hitters” such as Sir Richard Branson, Sir Tom Hunter and Sir Philip Green have been laying down this framework for years and are now as much renowned for investing in new projects as they are for their work with their own organisations and with it wealth creation can continue to flourish whilst governments stall.

And the best part of all?

The actual money invested is just one part of the process. The expertise and confidence that “big hitters” bring to those with the new ideas means these embryonic businesses are given the insights and wisdom that investment alone never brings.

Money is invested to create more money and more jobs and success stories inspire others to follow the lead.

After all, success breeds success.

Perhaps it’s a lesson our government should heed.

LEHMAN BROTHERS

noreply@blogger.com (René Carayol) — Thu, 18 Sep 2008 07:51:00 +0000

Six months ago at one of our Inspired Leaders Network sessions, a guest rightly predicted that Bear Stearns was in serious trouble and on the brink of going under.

He then went on to say that Lehman Brothers were next. It was greeted with a stunned silence around the room but in both cases he proved to be exactly on the money.

So how did he predict both unlikely outcomes whilst others were oblivious to the problems of these financial powerhouses?

In truth, they were both accidents waiting to happen.

Put simply, investment banks rely solely on a strong brand and great people; meaning they have the best talent to make staggering deals and think the unthinkable.

But with these “untouchable” people seemingly bringing in a never ending and ever-increasing revenue stream, there have been no checks and no balances put in place, with the once positive risk-embracing cultures in which they thrived being allowed to get out of hand. At some point a landmine was bound to be stepped on.

Retail and commercial banks are entirely different; they have their own assets (their customers’ deposits) and as a consequence are at the other end of the spectrum and are almost totally risk-adverse.

The recent turmoil in the financial sector has meant that the retail banks are the ones that have had the security available to weather the storm and deal with the downturn. It has meant that we are now seeing the rise of the universal bank; ones in which the investment part of the business is funded by their retail arm. It is a far cry from investment banks that have been gambling other people’s assets.

It means that the face of banking is set to change forever and that the necessary risks are balanced by the need to preserve the organisation as a whole. Nobody is quite as blasé when gambling their own money.

Bank of America is one such universal bank and recently bought Merrill Lynch, with the same looking set to happen with Barclays buying out the principal assets of the beleaguered Lehman Brothers. Both are great moves that secure the future of thousands of jobs and encourage further wealth creation once confidence returns to the sector.

But the big question remains as to how the colliding cultures will combine and where the power lies. As ever, the answer lies with strong leadership.

Dick Fuld, Lehman Brothers’ chief executive, has always been regarded as one such leader. Big, strong, charismatic and nicknamed “the Gorilla” for his aggressive management style, Fuld turned a $102 million loss in 1993, the year before he took over as CEO, into a $4.2 billion profit last year.

His business felt he could walk on water; after all he didn’t just take all the spoils, he looked after his people and made them both wealthy and happy by spreading around billions of dollars in bonuses.

And yet by creating an environment where nobody challenged him, he became so bold and so brave that he considered himself invincible and emerged fixated on some of the most toxic and frothy investments around; such as high-risk mortgages.

His board failed to challenge him and despite the situation being discussed the world over, from warnings by city analysts, through to frequent media rumours of troubles ahead for the firm and even down to people at the Inspired Leaders Network mentioning it six months ago, he refused to acknowledge that Lehman Brothers was in difficulty.

He simply didn’t listen, believing the hype and thinking he was the maverick that would always prove everyone else wrong.

In order to feed his ego, he bet the farm.

Once in a while we all find ourselves in the situation where we have to bet the business, which can be fine as long as you know you’re doing it.

Fuld got to the stage where everyone made him feel invincible, so he didn’t know.

If ever there was a situation in the business world that showcased three fundamental rules of leadership then this was it; Fuld failed to surround himself with people that were better than him, could compensate for his weaknesses or even stand up to him.

A year ago Stan O’Neal was forced to resign from his post as CEO of Merrill Lynch after losing the confidence of his boardroom colleagues. The people around him WERE strong enough to stand up to him and now after their buyout, their future seems safe.

Dick Fuld should have been kicked out long ago and with it Lehman Brothers’ bankruptcy could have almost certainly been avoided if the organisation had acted sooner on the advice and warnings from all around.

Now it’s all over and once again it shows that no matter how great the leader, everyone needs to be challenged.

Unfeted power ALWAYS becomes intoxicating and dangerous.

TRANSCENDING RACE

noreply@blogger.com (René Carayol) — Thu, 10 Jul 2008 17:12:00 +0000

Even on the cosmopolitan streets of London we still find it difficult to have open conversations about race.

Yet every now and again there is an event that puts race at the top of the agenda across all the media.

Usually the spark that lights the tinderbox is a tragedy; from Stephen Lawrence and Damilola Taylor to the increasing levels of knife and gun crime amongst inner city gangs.

But sometimes it can take an issue that is far less clear cut; a story that becomes difficult to take sides and requires a little longer to reflect.

The grizzly demise of Ray Lewis as the Deputy Mayor for Young People is one such event that should have generated a meaningful and constructive debate.

Unfortunately it won’t. Instead it will degenerate into spurious scandal with whispers of racial motives.

Of course it takes all eyes away from the simple point that has been sorely lacking in the coverage of the build up to and fall out from his resignation.

How does Ray’s departure help reduce the violence on our streets in London?

For many in the city, Ray Lewis is still the right man to help deal with the problems of street crime and how to get the best out of youths that have strayed to the wrong side of town. Whether he is Deputy Mayor or not, most just want to see the problem resolved.

And make no mistake about it; Ray Lewis is the man to tackle youth crime head on.

I was invited to Ray’s Eastside Young Leaders Academy with my son a few months ago and three things struck me about our meeting.

Firstly, Ray is an inspirational leader who “gets it”. Secondly, there was tangible and demonstrable evidence of the change he was making to predominantly young black boys who were otherwise heading for incarceration.

Lastly, in the brochure about the project I couldn’t help but notice a large number of Tory “grandees” amongst the movers and shakers behind the scenes at the Academy.

After spending a couple of compelling and hard hitting hours in Ray’s company I remember leaving feeling uplifted, realising that whilst patrons and trustees of such an organisation would probably have come from the Labour Party in the past, now it appeared that the greater good and social conscience was bridging the gap across the political fence.

It was obvious to me and my son that Ray’s role and approach needed amplification across London because he was having considerable success in transforming many children’s lives.

But did he need to be go and be part of the Mayor’s office to carry on doing that and expanding on that?

The temptation to politicise his role and contribution was unfortunately one of the key factors in his downfall.

I know so many community leaders that are doing a fantastic job despite not having a squeaky clean past. In fact it is because of this that they have the authority that resonates with today’s youth and enables them to connect and inspire change.

Ray is eloquent and hugely articulate but most of all supremely street wise and well connected.

Surely he should have been made a specialist advisor if he had wanted to take advantage of what the Mayor’s office could bring to his “reach”?

The focus would then have remained on what he could bring to the table rather on how he got there before.

The real loss is the opportunity that has passed.

Here was a man that was elevated into the public eye and shot down almost instantly by forces that simply saw a sitting duck to harm their political enemies.

Did the claims against Ray have any relevance as to how he would have gone about reducing the levels of youth crime in London?

Despite the hubris in the papers about another black role model being engulfed in scandal, the focus should not be about race.

It should be about leadership and playing people to their strengths to overcome a problem.

Boris took the necessary move to build a team around him that compensated for his weaknesses. In Ray he picked exactly the right man to spearhead a campaign to make our streets safer and get to the hub of the burning problems of our disaffected youth.

Unfortunately he put him in the wrong role.

As a nation we remain obsessed with structure and job titles and not on outcomes. With a simple adjustment of where Ray fit in Boris’ team, and how he was positioned to the media, he could still be in his role today and doing what he does best.

This sad episode has no winners but us Londoners are certainly the losers.

EN VOGUE...?

noreply@blogger.com (René Carayol) — Fri, 04 Jul 2008 13:04:00 +0000

In the July issue of Italian Vogue only black models have been used as a reaction to recent anger over the reluctance of fashion magazines to feature black models on their covers, with the levels of exposure for black women among the lowest since the 1960s.

Back in the late Nineties during my time at IPC media, if we put a black artist on the cover of NME or Melody Maker it was invariably followed by a drop in sales of about 50%.

It appears to still be a problem today with Vogue admitting they are expecting perhaps their worst sales figures ever as a consequence of their choice to use black models solely for the issue.

And then we have Jay-Z headlining Glastonbury this year, with his appearance bringing adverse headlines and negative press to the event, culminating in sluggish ticket sales for the legendary festival.

To top it off, Britain’s most senior Muslim officers in the Metropolitan Police are planning drastic action to highlight claims of discrimination at the very top of the force.

Just what is going on?

With the current favourite for the next US election being black, just how far off the pace is the UK when it comes to issues of race?

EDUCATION, EDUCATION, EDUCATION

noreply@blogger.com (René Carayol) — Wed, 28 May 2008 15:39:00 +0000

There has been no fiercer topic for debate in the UK over the last 10 years than education, education, education. It was at the cornerstone of many of Tony Blair's policies and was scrutinised and criticised at every turn by the media.

Many have said a good and standardised education is the absolute key to success for not only the pupils and schools but the parents and nation, and increasingly every aspect of our education is being measured. But in amongst the debate over the merits of private schools vs state schools, is it perhaps leadership that has the most pivotal part to play in the shaping of our future?

BEAR STEARNS

noreply@blogger.com (René Carayol) — Thu, 20 Mar 2008 09:12:00 +0000

I know I’ve touched on this subject before but it is far too important not to try and force home this point once again.

Our media is talking us into a recession.

Jeremy Paxman was on Newsnight a few days ago once more talking about the impending calamity that is about to befall the business world with scenes of the 1920s Great Depression showing behind him.

He’s not alone. The press is universally similar in tone; all are equally determined to undermine consumer confidence and if or when we do enter a recession then they’ll wonder how.

But the problems don’t lie solely at the hands of the media. The way crises are dealt with at the outset of a problem (before confidence drops and panic spreads) is absolutely crucial.

Take Northern Rock.

It was always an accident waiting to happen but when disaster struck the bank the financial sector’s “emergency services” that comprised of the Bank of England, FSA and HM Treasury stood around and scratched their heads.

Lloyds TSB came in with an offer within days of the ‘patient coughing up blood’ and tabled a rescue plan. The three wise men did nothing.

Instead they entered into a game of chance and started a beauty parade of interested parties whilst Northern Rock slipped closer to the edge.

Whilst the “powers that be” dithered, customers started withdrawing their money at an alarming rate and suddenly panic soared and confidence slumped as a hungry media bit hard on the wounded.

When a bank loses the trust of its customers, it is dead. And Northern Rock died.

With the likes of Virgin and the private equity boys trying their best to resuscitate the Rock our ditherers eventually plumped for the plan that nobody wanted. Not Northern Rock, not the government and especially not the tax payer.

The British nation is increasingly cynical about government so think about it. If the population doesn’t trust the government, it won’t trust the bank.

I’ll say it again. When a bank loses the trust of its customers, it is dead.

Bear Stearns is the US Northern Rock.

It has become increasingly clear that the risk-embracing investment banks of the US were heading for a fall and Bear Stearns is the first high profile victim.

But in this case there was a big difference; the Fed ‘rescued’ the ill patient in 48 hours and over a weekend. Before the weekend was up, JP Morgan had acquired the firm for $236 million.

Unlike our ditherers, the Fed had seen the bigger picture. They didn’t become a victim of nostalgia over the 85 year old firm’s history.

It might not be enough but at least it has arrested the rapid decline and staved off the panic mongers at the pass.

From a leadership perspective, doing nothing is never an option. When a problem arises move decisively towards it. Strong, decisive action is the only way problems can be resolved and if we do nothing about managing the affects of the US credit crunch and dwindling consumer confidence then we will talk ourselves into a recession.

TOP TEAMS

noreply@blogger.com (René Carayol) — Thu, 21 Feb 2008 09:15:00 +0000

The feedback I am getting on an almost daily basis now is one of “confidence dropping out of the market”. Analysts are predicting a recession and people are starting to panic; everyone is clamouring for the secret to trading through these tougher times.

And the government is once again falling short on the leadership front.

They are showing us how NOT to survive in testing conditions.

Turn back the clock for a minute and look at Tony Blair’s leadership in his prime. He surrounded himself with “big beasts” – the big hitters like Peter Mandelson, Gordon Brown, David Blunkett, Robin Cook, John Reid, Charles Clarke and Mo Mowlam.

All were extraordinarily gifted in their own right and all brought experience, talent and expertise to the team. They were easy to lead but perhaps hard to manage.

What Blair knew instinctively was that you can’t micromanage big beasts. In fact nothing offends the big hitters more in business than having people watching over their shoulder every minute, especially when they are more than capable of doing the job in hand.

Brown doesn’t seem to get this. Arguably his only big hitter is none other than David Miliband and yet even he is subjected to having his speeches checked, vetted and re-written.

Understandably this left Miliband feeling undermined and not trusted.

The challenge of having big beasts on your team is that on occasion they’ll want to do it their own way. Sometimes this is fabulous and justifies why you hired them in the first place but on other occasions you may have to face them down. The trick is to know when and how; this is an approach that Brown doesn’t appear to adopt and a telling insight into why his team is so devoid of big beasts.

Blair had a string of explosive confrontations with the likes of Charles Clarke, Robin Cook and even Brown himself but these incidents were always worth the risk compared with having a top team that consisted of no big players.

As we’ve all learnt, the real skill of new age leadership is to know what you do brilliantly and identify positions that expose your strengths. But just as important is the need to be very clear at what you’re not so good at and compensate for these shortcomings by hiring people that are better than you at those things.

It is not clear if Brown knows what he is not good at.

Consequently his team lacks balance and strength. It is a timely reminder for any of us that these qualities are crucial in tough times, including those that have already tasted extreme success and bitter failure.

Like Kevin Keegan.

It is well understood what his strengths are. He is arguably the best man manager and motivator in the Premier League and he has been hailed as the returning messiah in the North East.

I was lucky enough to bump into him recently at the Jesmond Dene Hotel in Newcastle, where even in a casual setting his impact on the locals was quite phenomenal.

And yet for all his presence and charisma, it will be Keegan’s top team that will determine whether the returning hero will bring success back to Tyneside. Firstly there was the “Will he? Won’t he?” Alan Shearer saga and then Dennis Wise was swiftly installed as Newcastle’s Executive Director. In both cases there have been hints that perhaps the vision at the very top of Newcastle is not as clear as it seemed a few weeks ago.

It remains to be seen whether the likes of Dennis Wise has the calibre to surround Keegan with the support he needs. And if these appointments turn out not to be Keegan’s choices after all but those of the Board then it could all end in tears eventually. The truth always outs.

As a lifelong Chelsea fan, Jose Mourinho’s departure was a painful start to the season but I must give some grudging respect to Avram Grant. As an almost unknown outsider plunged into the limelight, he poached a manager from another big European club to work under him and compensate for his own shortfalls. It was a brave move considering his own position was under intense speculation and bringing any big name into the coaching staff could undermine him.

But the difference between the task Keegan faces at Newcastle with that of Grant at Chelsea is monumental. Jose Mourinho created such a strong culture in his time at the helm that Grant merely had to move into the successful house that Jose built; he didn’t need to redecorate. Keegan has had to overhaul the whole operation and for that to succeed he needs the best of the best around him.

Most contemporary organisations are far too complex for one person to be able to deliver leadership all the time and on their own. Leadership now means the whole leadership team but it still takes an inspired leader with huge self belief to surround themselves with people better than them.

EXPERIENCE V TALENT

noreply@blogger.com (René Carayol) — Fri, 11 Jan 2008 09:26:00 +0000

As the US Presidential election starts to warm up with George Bush leaving office in just under a year, all eyes have turned to the frenzy of the Iowa and New Hampshire votes and the race between Barack Obama and Hillary Clinton as the Democratic candidates.

Everyone is talking about change, hope, foreign policy, race and reputation but nobody is mentioning leadership.

And this just makes me wonder if Hillary is set to make the same mistakes as Gordon Brown.

She has consistently been playing the experience card; directly appealing to the core voters with the view that she is a seasoned pro and a safe pair of hands. Brown did the same and having been brought to power on this remit has found there is no place to hide when things go wrong.

In business we’ve known for some time that it is no longer about length of service but about talent.

Hillary is playing a dangerous game by suggesting that Barack has not been around long enough to be any good.

Who wants to hear that anymore? It is exactly this risk-adverse, safe option that leads to old fashioned, status-driven organisations and stifled governments. The US needs a leader that is strong, inspirational and has the ability to get huge swathes of people to follow their vision.

I’m surprised and disappointed by Hillary Clinton’s approach to these elections so far; she has so much more to offer as a politician.

What she has failed to do is spot talent herself. Just because Barack is young does not mean he is not capable - freshness and vibrancy can be as equally compelling as experience.

Gordon Brown led us all to believe that having been Chancellor for such a long period of time meant he was well equipped to deal with the number one position. But, the two roles are very different and what he has shown us is that a successful Chancellor must manage but a successful Prime Minister must lead.

Let’s hope for a far more open leadership competition than we had here in the UK; one that will focus more on what needs to be done rather than what has already been done.

Our world is moving so quickly that experience can be both an asset and a liability. The ability to learn and adapt to a fast changing landscape is just as important but the real attribute the USA needs now is inspiring and inclusive leadership.

THE TEMPLE OF DOME

noreply@blogger.com (René Carayol) — Fri, 14 Dec 2007 17:14:00 +0000

When Led Zeppelin played at the O2 arena the other night to packed crowds and stratospheric gate receipts, it showcased once again the ever-growing feeling that business has the power to make more impact in the modern world than government.

When the Millennium Dome opened at the turn of the century it was hounded and harangued by the press relentlessly and was considered by critics across the country to be an embarrassing and badly executed waste of time and money.

It was the laughing stock of London.

With an ever-changing management team at Board level and unrealistic expectations for visitor numbers set by the Government, it was the antithesis of the vibrant and exciting leadership that had swept Tony Blair and New Labour into power.

Here was a project that became synonymous with failure; it attracted half the number of people through the gates than had originally been hoped for and squandered £204 million more of lottery money than had been planned for at the outset.

To make matters worse, after the closure of the Millennium Exhibition at the end of 2000, the structure remained out of action for most of the next six years. Again the government came under fire from the circling press for its expensive closing of the arena and the exorbitant amount it took to maintain the building as it lay vacant.

It was a perfect example of the inability of the Government and the public sector to implement large-scale plans effectively. Time and again there were calls for the project to be handed over to big business to ensure its success.

But instead it turned into a political and financial black hole.

After years of debate over who would save the Dome, the government finally chose AEG to redevelop the site as an entertainment centre with surrounding houses, shops and offices. At the centre of the financial backing lay American billionaire Philip Anschutz but the figurehead for the project was AEG’s charismatic and revered CEO Timothy J. Leiweke; considered to be one of the world’s leading presenters of sports and entertainment programming.

When telecommunications giant O2 put pen to paper on a £multi-million per year sponsorship deal over an incredible 15 year period, the cynical business press laughed out loud.

Philip Beard was quickly installed as the CEO for the renamed O2 Arena and brought with him a growing reputation for winning.

As a former head of the 2012 Olympic Bid under Lord Coe, here was a man that had a track record of getting things done.

But despite Beard’s insistence that the venue was “London’s most exciting indoor space”, still the media reported that the Dome was doomed.

Yet when it re-opened as “The O2” the results were spectacular.

Six months later and it has become the most successful music venue in history and has secured its place at the heart of London’s entertainment as a music and sporting arena of world repute.

Peter Erskine, CEO of O2, has since gone on record as saying that after just half a year of global exposure their total sponsorship investment over the 15 years has already been repaid in terms of brand recognition and reputation.

Not only that but many believe that in the huge battle for the rights to the groundbreaking iPhone, O2 kicked rivals Vodafone and Orange into touch simply due to their growing music reputation thanks to the O2 Arena.

As the music industry struggles to find a new strategy with the slowing of CD sales and the surge in downloadable music at little or no cost, live music is where the big money is being made.

The O2 Arena has already made a name for itself in terms of diversity. From the Spice Girls to NHL Ice Hockey and from 50 Cent to the 2012 Olympic Gymnastic Finals, it has the capacity to run some of the biggest and most challenging events in the world.

In short it has become one of the most sought-after global venues.

But again it has taken big business to deliver the big projects. The government continually falters under spiralling deadlines, budgets and media pressure.

When comparing the new Wembley Stadium, The Emirates Stadium and The Millennium Dome it becomes painfully apparent that the Government simply cannot and should not get involved in these projects.

Wembley and The Millennium Dome became synonymous with controversy and costly errors whilst the privately funded Emirates Stadium and O2 Arena have been unquestioned triumphs. Only big business is comfortable naming buildings and securing lucrative sponsorship deals and only big business seems capable of delivering results on budget and on time.

When will the government learn that it is perfectly suited to starting these initiatives but to prevent future wasting of taxpayers’ money it MUST hand them over to private sector organisations for delivery?

LOST IN THE POST

noreply@blogger.com (René Carayol) — Wed, 05 Dec 2007 15:30:00 +0000

It has been a strange couple of weeks.

Firstly there was the hugely damaging announcement from the government that the personal details of 25 million people in the UK had been transferred onto two CDs before being lost in the post, thereby leaving 7.25 million families at risk of mass identity fraud.

Then there was the end of England’s torrid qualifying campaign for Euro 2008 that saw our “Golden Age” prodigies once again fall woefully short of their potential.

In both cases it has raised many questions but the message is the same. If you don’t have the right talent in your team you won’t win. And even if there is talent, the wrong leader at the helm can be fatal.

The Treasury and the England football team have had problems for years - fundamental issues that have been slowly eroding at the structures of both organisations. In Labour’s case they had Tony Blair at the helm to cover the cracks.

For all his faults, Blair was a great leader and an exceptional communicator. Perfect he was not but he conveyed his vision with a confidence and honesty that gave him authenticity. People believed that he would do the right thing.

Sven too papered over the cracks for England. It was obvious that the England squad was full of individual talent but lacked team cohesion. But nobody doubted we would qualify for major tournaments and instead moaned that his lack of visible passion must be responsible for the sometimes lacklustre performances on the pitch.

But since Blair and Eriksson have gone the wheels have quite literally fallen off. The Treasury and Labour Government have lurched from one crisis to the next and have done nothing to raise confidence in times of difficulty.

As for McClaren’s men, England have failed to qualify for Euro 2008 and suddenly the whole footballing structure of this country is being questioned and ridiculed.

In both cases, the more you look into the problems, the less comfortable you feel.

There is an inherent characteristic in Britain to play not to lose instead of playing to win.

When Alistair Darling announced the data leaks to the House Of Commons he should have been brave, confident and honestly opened up the situation that the government found themselves in. Instead Labour sat on the information, covered their tracks and blamed a junior minister. It was playing not to lose.

McClaren DID shoulder the blame for England’s defeat but he should never have been in that situation. He was appointed when the first choice ruled himself out and always seemed he was chosen as the “easy” choice. After all the public was baying for an English coach and McClaren was part of the set up that had led England to three successive quarter final appearances in major tournaments.

But how could appointing him be playing to win? The England manager’s job is amongst the most prestigious in the world but is now seen as a poison chalice. How has it come so far that genuinely world class coaches refuse to take the job?

The answer is all about perception. Again we are playing not to lose by having the likes of Brian Barwick deciding on the England manager’s appointment. We need people that can sell the role, cajole the best talent into considering the “dream job” and playing up to their egos of turning around the sleeping giant of international football.

We should not be listening to the ill-informed that say he should be English, or those that side with the appointment of completely untried and tested former players like Alan Shearer.

We should be looking for the best. Playing to win means changing a mentality where mediocre is good enough and where losing gloriously is almost as good as winning.

It is something that Labour should take heed of because they are in trouble. It is not good enough to fire fight constantly and continually save face when things go wrong. They need to be setting the agenda and forcing the pace and making it very clear that any errors along the way are a “blip” and not the norm.

No longer do they have the big hitters and big names on the front bench. Brown was a great Chancellor because his dour persona and plodding diligence made him authentic and trusworthy within The Treasury. But as a national figurehead there is simply no room for sparkle and creativity in his government.

On the other side the Tories have a leader who has learnt from Tony Blair’s success and has a vibrant, young team that is taking the fight to the establishment as New Labour once did.

They, like us, are just waiting for the next catastrophe and blunder to pounce on.
It is a time when once again leadership is in the spotlight and it comes back to the old conundrum – are leaders born or made?

In times of crisis, leaders are found.

Jose Mourniho is the man to lead England back from the footballing wilderness but looking at the government’s front bench we may well need an election to solve that particular problem.

In both Brown’s and McClaren’s case they were great when second in command but have struggled to make the transition to becoming number one.

It’s a phenomenon that’s seen time and again in all walks of life and will be seen forever more; Robin very rarely becomes Batman.

IT'S TOUGH AT THE TOP

noreply@blogger.com (René Carayol) — Wed, 14 Nov 2007 11:34:00 +0000

At the end of last month Stan O’Neal left his position as CEO of Merrill Lynch after allegedly being forced out by his board members following a whispering campaign that alluded to “years of underperformance”.

Then at almost exactly the same time Richard Parsons, CEO and Chairman of Time Warner, also announced that he will be stepping down as CEO on New Year’s Eve this year but will remain as Chairman of the Board.

Both act as a reminder that it’s tough at the top.

The coverage in the US newspapers did exactly as it should – reporting that two hugely successful big hitters from global powerhouses had quit after their companies had fallen into difficulty.

In the case of Merrill Lynch they had just announced a third quarter loss of $2.24 billion (the worst in the firm’s 93-year history) and Time Warner has been gripped with operational challenges, mostly revolving around AOL.

It is natural that all eyes should turn to the leader in troubled times and O’Neal and Parsons will not be the last to fall on their swords.

But in the British press the slant has been rather different and a little disappointing. In fact it has been a return to an old fashioned habit of using race as a descriptor.

Over here the talk has been of two African American CEOs resigning; leaving just five black CEOs heading up Fortune 500 companies.

The Times in particular got itself into a little trouble with its online blog by adding the irrelevant fact of O’Neal’s race into their report on his performance.

All it does is fuel the underlying suggestion of “Would the knives have been out so ferociously had the CEOs not been black?”

And the answer to that is - of course they would. It has nothing to do with race; it is all about performance and quality. Both O’Neal and Parsons had brilliant careers and once they got to the top they all but lasted the average length of service for CEOs in the US and Europe - six years.

It was simply time to move on as the fortunes of Merrill Lynch and Time Warner significantly waned at the end of their watch. It’s the only way the best of the best keep ahead of the chasing pack.

Let’s not forget that CEOs from these firms aren’t left penniless, regardless of their race. Sources have confirmed that Stanley O’Neal left Merrill Lynch with about $90 million in stock, $40 million in options and $30 million in pensions and other parts of the package.

$160 million and “retiring” at 56 is not worth shedding too many tears over.

The real truth behind all of this is that race is still a story here in the UK – epitomised by Ian Wright’s row last week with a traffic warden.

The alleged quotes in The Times, Daily Mail and The Sun (amongst others) have told of Wright apparently accusing an African traffic warden of being a “monkey” and none too politely to return “back to his own country”.

Wright’s version of the events are of course very different and he maintains that he was called “a white man who lives in a white man’s road” and that he had responded by asking if the warden’s parents were “happy you’ve come to England to be a traffic warden instead of a lawyer or something”.

Whatever the outcome, these allegations of racial abuse will throw up a conundrum.

If found guilty, will Ian Wright be sanctioned and criticised as heavily as Ron Atkinson who famously quit ITV and The Guardian after comments about a black Chelsea player?

Wright’s race should be irrelevant and if the courts prove that he did say those remarks then he should be punished just as severely as Atkinson.

If it turns out he didn’t racially abuse the warden then it will be yet another example of someone trying to use another’s fame and wealth for their own ends.

My guess is that should the finger of blame point at Ian Wright after his alleged outburst then race will once again prove too hot to handle for the British press.

It always does.

JOHN HUMPHRYS

noreply@blogger.com (René Carayol) — Thu, 25 Oct 2007 13:28:00 +0000

Last week on the motorway up to Bristol I was listening to John Humphrys on the radio interviewing Michael Grade, who famously jumped ship from the BBC just under a year ago to become the head of its commercial rival ITV.

They were discussing the ITV phone-in scandal that has engulfed the network and Grade’s brave decision to call the scandal a “serious cultural failure” in which there would be no witch hunt but instead people would be encouraged to come forward and voice their opinions.

As Grade recently said in a press statement,

“I don’t intend to take a couple of scalps in expatiation. That would not solve the problem.”

Instead it was very clear that a line had now been drawn underneath the affair internally and everyone working at ITV was explicitly aware that any further breaches of the company policy would lead to drastic and final action.

And yet today during the interview Humphrys was like a broken record; “Heads must roll”, “What went wrong?”, “Who is to blame?”.

It is always the same with the media when things go wrong. Formulaic, dull, boring and wrong.

It is an issue that has continued to plague the BBC and is symptomatic of the public sector. They always, always, always look to point the finger and fire the scapegoat.

Does it fix things? No.

In fact, it frustratingly remains the main distinction between the public and private sectors.

Measurements of success in the private sector remain much clearer; profits and share prices. This has enabled private organisations to measure the effect of sacking a prominent figurehead like the CEO after a damaging episode such as the phone-in scandal.

What has been found is revealing. If you fire a CEO, invariably the shares and profits of the company drop, meaning that there is almost always a better way to deal with the problem.

First you should look to provide support, then attempt to fix the problem and finally do a post mortem and work out how to avoid it in the future. It is exactly what Michael Grade is doing at ITV and exactly what happened with Northern Rock.

In both cases it didn’t start with a sacking and they have handled their spiralling situations well. In the BBC’s case with their own phone-in scandal “heads have rolled” and with it has come panic, uncertainty and universally bad press.

Their “head” this time was Peter Fincham, who ended up “resigning” over the Queen’s storming out saga. It had absolutely nothing to do with phone-ins but he was the person that had the profile to match the scale of the phone-in disaster.

So I ask the question again,

What has this done for the BBC? Nothing.
Has anything changed? No.
Has it helped their credibility? No.

They have instead lost a brilliant controller for BBC1 that was universally admired by everyone who worked for him.

Mistakes will always happen but progressive companies deal with it openly and honestly. Those that fire the figurehead create a climate where nobody takes any risks. In short it creates a blame culture.

In ITV’s case Michael Grade is absolutely right. It’s the culture that’s broken.

Fixing culture is not about firing people; it’s about the leader being brave enough and big enough to accept that there is something wrong, then reprimanding all involved and finally protecting his people so that they can then be caught doing things RIGHT.

Grade has taken ownership of the issue and now nobody has an excuse in the future and can try harder without fear.

Now that’s what I call leadership.

NIALL QUINN

noreply@blogger.com (René Carayol) — Sun, 14 Oct 2007 16:47:00 +0000

Whilst chairing a conference in Dublin last week, I found the qualities of a truly inspired leader in the most unlikely of places.

It came from one of the keynote speakers at the event, Sunderland FC Chairman Niall Quinn; a man renowned for taking the back seat and letting others revel in the limelight and adulation, whilst he quietly operates behind the scenes.

Quinn is a proud Irishman. When it comes to football; it is Quinn’s time with Sunderland that has stole his heart.

Sunderland is a text book English North Eastern city – massively wealthy at the turn of the century thanks to steel, coal and shipbuilding. It became a shadow of its glory days once manufacturing disappeared and with it went the best jobs and the city’s confidence.

But, during the boom times Sunderland Football Club was founded and it stood as a symbol of strength, confidence and community throughout the rise, fall and subsequent rebirth of this part of England. No matter how bad it got in the post War period, huge numbers of locals would turn out to cheer on their lads on the football pitch.

At a time when there was so little else to raise spirits - to win meant so much.

And yet in these far more competitive times, fervent support is no longer enough. Sunderland have fought back twice since dropping out of England’s elite Premier League and both times have crashed back into the division below whilst breaking records for the least points achieved.

It was a topsy turvey time for the club but the Board of Directors had the foresight to invest in a magnificent stadium – the Stadium of Light.

Even so, with Sunderland languishing out of the top flight and staring further relegation in the face, Niall Quinn arrived as a former player-turned-saviour with his unique vision and passion for the club.

Quinn had a reputation for integrity and intelligence; one of the games truly “nice guys” that had earned him the nickname Mother Teresa. He found support for his investment back home in Ireland and got the backing of a consortium of property developers and financiers.

With the superb ground justifying the initial investment, he now needed to attract the best players to ensure their promotion back to the Premier League and bring with it the lucrative TV revenues that the league enjoys.

5 years ago only 8 countries had live football on TV. Now 207 countries regularly beam it out to their populations as the global football explosion has taken hold.

Quinn knew he needed a brilliant manager with a high profile and he opted for the controversial, untried but massively popular figure of ex-Manchester United legend Roy Keane to take the mantle.

It was a masterstroke; he turned round the failing team and motivated his players to not only rise up the table but to get promotion in his first season. Keane’s reputation as a player has also enabled him to bring in talent that would have rejected the move to the North East previously.

It is now a career step that is not unrewarded. Sunderland is a city of only 200,000 people and yet 45,000 home fans turn up religiously to every game.

At the Dublin conference Quinn spoke with a conviction, passion and self-depreciating humour that was shot through with authenticity and compelling leadership qualities.

He closed with a story that summed up his time at Sunderland.

As part of the team’s marketing thrust, there was to be a picture of Keane snarling and angry and leading his team on. For this it needed Keane to agree to the publicity, which is something he too spurns and instead opts to concentrate on winning.

Asking Keane was never going to be easy and so the Board drew lots as to who would be responsible for coaxing him into it and Quinn was genuinely relieved it was not him.

Strange behaviour for the Chairman to not step forward when he is the boss? Maybe. But Quinn is always authentic. He has no pretensions to being something that he isn’t and he is happy to admit to being daunted by things he shouldn’t be.

In the end Keane readily agreed and when it came to the shoot he was asked to stand in the corner and pretend to be angry.

He snarled back at the photographer “you’ve got 60 seconds and I’m not pretending”.

He is the exact antithesis of Quinn but therein lies the magic. Like all great leaders he has brought in people to complement his own style. Quinn has charm, vision and an ability to listen and take advice, Keane is all tenacity and presence.

But the real trick is that fundamentally they are remarkably similar. They have a team ethos that trickles through every facet of Sunderland and puts the Club and its success before egos and grandstanding.

As the recently departed Jose Mourinho from Chelsea said, “Great players don’t win trophies, great teams win trophies”.

And Sunderland has a great management team.

LORD JOHN BROWNE

noreply@blogger.com (René Carayol) — Tue, 02 Oct 2007 11:46:00 +0000

A few months ago I was approached by The Money Programme to present a Friday night special on the ignominious fall of Lord John Browne. They wanted a balanced report on what actually happened to the celebrated industrialist and to uncover the truth behind the headlines.

The feeling in the press was that BP was already distancing itself from their former leader; in came Tony Hayward and already there was more media warmth, a softer line on the Texas City refinery disaster and a friendlier approach. A new sheriff was very much in town and the BP bandwagon rolled on with every indication that its reputation as a world player remain intact and was arguably growing.

But what about Lord John Browne, the dethroned Sun King?

Browne had always been a hero of mine; the genius at spotting mergers and acquisitions at the right price at the right time and the man that had single handedly transformed BP into an international giant.

And yet no leader is good at everything. There are always areas of weakness.

Lord Browne’s Achilles heel was that having grown BP beyond all recognition, he simply didn’t have the empathy or connection with his people to spearhead the hugely challenging integration between the different cultures that now came under his stewardship.

If the unimaginably successful first 8 or 9 years of his tenure had been about growth, the troubled last 3 years were all about integration.

It was a disaster.

Truly inspired leaders have humility; a trait that endears them to everyone that follows them. Take Mandela, who had the support of both sides of a then deeply divided South Africa. Both blacks and whites worshipped him.

Browne instead acted up to his nickname of the Sun King, with the board of directors little more than his courtiers. He was too revered and too idolised by everyone and everything around.

It has been said time and again but when people are not stopped and questioned it becomes a dangerous and arrogant game. It happened to Margaret Thatcher. It happened to Tony Blair. It is a very British trait to put success stories on a pedestal until they are deposed.

And then the shackles are off and the mighty fall hard. Perhaps a little too hard.

All truly great leaders know their strengths and know their weaknesses and surround themselves with people that can compensate for the faults.

That’s the theory at least; in reality you have to make sure you listen to those people. When I spent time talking to BP employees it was clear that Browne was seen as aloof and isolated and was simply too far removed from the decision makers at ground level.

Any leadership failure comes down to being disconnected. If it is being disconnected from the board of directors then you can get away with it for a short time. Being disconnected from the workforce and people will quickly catch on that there is something wrong. Being disconnected from the customers kills the business.

Just look at M&S before its turnaround. Or even look at Virgin Media.

Branson has always been incredibly careful with the Virgin brand but he simply didn’t listen to the masses that told him NTL was renowned for appalling customer service. Turning them into Virgin Media was a bold move by the master of branding.

But even putting the Virgin name to NTL has not covered up the cracks. Now Virgin itself is tarnished and all because Branson has become disconnected from the very people that buy his products.

Everyone needs a critical friend and a supportive challenger. We used to call them Non-Executive directors whilst the US calls them Independent Directors.

It might just be that Lord John Browne’s biggest mistake was that he had simply forgotten to use his sounding boards.

If you are in a leadership position, ask yourself a question before it is too late.

Who is providing the tough but necessary feedback?

HURRICANE KATRINA

noreply@blogger.com (René Carayol) — Wed, 26 Sep 2007 08:00:00 +0000

It’s only by travelling to the deep south of the US that you can truly understand the carnage caused by Hurricane Katrina. Even now on the second anniversary of the devastating storms there are thousands upon thousands of abandoned homes on silent streets as the Big Easy struggles to get back on its feet.

It has been all but forgotten in Europe. It might even have been forgotten in most of the US but in the scorching heat of Louisiana and her surrounding states it is still a burning and resentful issue.

New Orleans epitomised the American urban sprawl and housed over a quarter of a million residents. Most are still waiting to return.

Over 100,000 residents are still stranded in Texas and tens of thousands are crowded into basic state-owned caravans around the city.

If this wasn’t a famous city in the richest nation on Earth and was instead a scene from the shanty towns of Africa we’d call the survivors refugees.

And that is exactly what they are; make no mistake about it.

The majority of the displaced come from the underclass of American society and nobody in the US wants to talk about it. Why? Because the line between race and class continues to blur as the underclass is virtually always black.

In the past it has been easy for many to simply say, “Out of sight, out of mind”.

Katrina blew this all open. As the crippling footage and pictures from New Orleans burst on to the world’s television screens two years ago it was impossible to not be left dumbfounded that they were being broadcast from the most advanced country in the world.

Those who could leave the city did; the middle class and financially self sufficient left in droves under their own steam.

But many had no choice but to stay.

In Houston and other nearby cities there are swathes of taxi drivers that are recent arrivals from New Orleans, working all hours to return to their loved ones at the weekends with as much money as they can make.

When they get back in the week to earn their paltry salary they are competing for the worst housing. They’re rarely seen in the big city centres and are usually packed into the outlying ghettos.

Initially it was portrayed as a positive move as the big urban centres breathed out to accommodate neighbours who had hit hard times. But this bonhomie is now creaking and, just like in other blighted parts of the world, the “refugees” are struggling to be accepted.

It struck me that, unlike the South East Asian tsunami, the genocide of Darfur or the earthquakes of Indonesia, the aftermath of Katrina has not been revisited and supported.

Whenever there is a natural crisis in the world it is always well portrayed in the media across the UK and Europe.

And yet this natural crisis has been consigned to history and left behind solely because it happened in America. Nobody has helped out and nobody has contributed. Many secretly asked the silent question, “Why should we help? They can handle it themselves.”

Which means that whilst one nation acts alone slowly and unsupported, its people suffer.

Those that I bumped into and met in New Orleans reminded me of the impoverished I have spent time with in Kenya and South Africa. The only difference was that in Africa the Western charities were in full flow.

In the Unites States the situation is more hopeless – there is a strong feeling that their own government has let them down and after that there is no where else to turn.

There is no cavalry arriving.

Surely there is no excuse for this to happen.

This is the First World; there is money, there is democracy, there is knowledge. There should not be suffering on this scale.