As we struggle to emerge from Wall Street’s nuclear winter, a new generation of business leaders may be forgiven for not solving all of the problems left on their doorsteps, but they won’t be forgiven for failing to offer a way of looking at what lies ahead.GE’s Jeff Immelt recently offered up a disquieting, but instructive, first take:
“There’s an expression we use that ‘past is prologue,’….That’s not true. You go through in your lives certain times when things change. And this is a time when things change. And one of the things that changes is what business leadership is going to be all about and what it’s going to mean for all of us personally and some of the things that we have to go do and we have to think about.”
This was said around the same time as the ‘Alan Greenspan Wasn’t God After All’ catharsis. Now—setting aside the obligatory Mother Goose pronouncements about trust, accountability, and how much corporations love puppies—it will be interesting to see how a 21st century business leader, an aspiring Pierpont Morgan, addresses Immelt’s challenge.
This is a time when things change. And one of the things that changes is what business leadership is going to be all about.
With the requisite caveat that there are factors in play that are beyond his or her personal control, I would offer two crisis management guideposts: Pierpont must be both the Moses, the force, and his brother Aaron, the PR man.
Pierpont’s main mission will be to show his company’s stakeholders—employees, clients, governments, media and opinion leaders—a way out of the wilderness. Moses needed to remind the squabbling Israelites that the hike across the desert was worthwhile because it was based on a central principle: Freedom—and maybe a little condo by the Dead Sea where they could tell the grandkids to stop running by the pool. Simple, attainable stuff. Eventually.
In an era where the marketplace demands instant gratification, Pierpont’s “Aaron instincts” will need to emphasize that there is a time to reap and a time to sow—disabusing the marketplace of the notion that double-digit returns will be the sole template going forward.
It’s not impossible. For years, critics scoffed at Amazon.com and Jeff Bezos, dismissing the online retailer as an Information Age Potemkin Village. It turned out that Bezos’ business model—buying things inexpensively without having to get off your rear—was one of the only ones that was viable. Eventually.
Pierpont needs to understand that crisis-management is about storytelling. It’s a battle of symbols, not facts. Contrary to what corporate “quants” may want to believe, the world of spreadsheet and computer models is extinct. In fact, the more data, the bigger the lie seems. It’s impossible to separate where the quantification of operational performance ends and narrative begins.
If the finance kingpins who brought us to this point possess a resonant micro-narrative, it is best encapsulated by the recent fiasco with AIG executives’ post-bailout $400,000 spa junket. This little parable rings true because it reinforces the belief that “they just don’t get it.”
On the other hand, Warren Buffett has become the great financial storyteller of our age because he isn’t just a wildly successful investor, he is an archetype. Pierpont Morgan’s name told a story of ruthless indestructibility. The very invocation of Buffett’s name weaves a self-contained tale that even people who don’t know a thing about finance understand: Humble beginnings, diligent homework, intuitive choices, geometric returns and an appealing grounding in sensible living. He’s made his billions investing from Omaha, Nebraska, not a penthouse in Manhattan. Put differently, Buffett’s “story” rings true, and doesn’t offend the senses so we allow him his success.
One possible model for aspiring saviors is Tyco’s Edward Breen. After the career of his predecessor, Dennis Kozlowski, went up in a flaming $6,000 shower curtain (a narrative symbol if there ever was one) and a lengthy prison sentence, Breen dismissed his entire board of directors. He replaced nearly every employee at corporate headquarters, and played the “inside game” of rescuing Tyco’s vulnerable government contracts and business-to-business operations.
Because Tyco was not a household name, Breen eschewed conventional public relations, and focused his storytelling skills in an elite tier of decision-makers, persuading them that a new team was in the cockpit. His efforts went largely unheralded. Not every resurrection need be front page news, it just has to resonate with a core group that matters.
Pierpont will have to segregate audiences that can be reached from those that cannot, and, accordingly, make plans to rally potential cohorts and hit back at obstructionists that can’t see past the populist archetypes of crimes and punishments.
We’re in for many rough years (not months), and whether it’s a recession or a depression, I suspect it’ll look a lot different than the 1930s, but I’m not sure how. One thing I am sure of, though, is that the Pierponts who lead us out of it will be subversive thinkers who look at history and human nature as it is, not how they want it to be, and have both the operational and storytelling skills to make it all make sense. Eventually.