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Myopic CEOs

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After interviewing more than a hundred Chief Executive Officers (CEOs) and other C-level executives from multinational companies, regional conglomerates, and small and medium enterprises (SMEs) in more than half a dozen Asian countries – from mainland China to Singapore, and from India to Korea, what does Joseph Baladi find as the most obstructive hurdle preventing mediocre and good Asian companies from breaking through a decades-long glass ceiling and achieving brand greatness? Myopic CEO leadership, he declares, in ‘ The Brutal Truth About Asian Branding: And how to break the vicious cycle' ( www.wiley.com).

“The CEO is driven almost exclusively by a desire to (only) make money – and rarely by passion. He will often over-promise and under-deliver. He will take shortcuts and consider himself clever for doing so. He rarely looks beyond today and lacks a vision for tomorrow.”

Top-level ignorance

If that portrayal of the CEO's mentality hurts, the description of top-level ‘ignorance' can be more so. For, the author observes that the CEO misunderstands branding and sees it as the company name and logo, and its promotion as taking place almost exclusively through the media. “Its conceptual, business, and strategic dimensions are totally lost on him, and his impatience causes him to dismiss or undermine the process before it even gets underway. As a result, Asian consumers fail to love, lust after, or be inspired by most Asian brands.”

In Baladi's view, much of Asia's traditional management philosophy is rooted in Confucian-based values, creating thus an environment where many CEOs operate, and see themselves, as patriarchal figures, as individuals who are at once irreproachable, and unapproachable. The resulting management style resembles a ‘by decree' approach, rather than one that is inclusive, he argues.

An interesting quote in the book is of Tom Doctoroff, JWT North Asia CEO, thus: “Chinese companies are sales-driven and managed by emperor-kings who rule in a defensive, even self-protective manner… Quite often, the instructions are promulgated in an ambiguous manner, resulting in an undercurrent of anxiety on lower levels, not an all-for-one future focus.” Alas, that should be true in many organisations closer home, too.

Make money

The almost universal reply that the author gets from CEOs for the question, ‘What is the mission of your company?' is ‘To make money.' And he says this single-minded, primary, and often exclusive goal of most Asian CEOs is commonly inculcated in the minds of their senior managers, from where it is filtered down to the lower ranks of employees.

While there can be nothing inherently wrong with the goal of making money and ensuring that the business is profitable, what shocks the author is that the CEOs pursue the goal in a self-defeating manner. “First, they fail to recognise that making money for its own sake is a flawed strategy; that making money is, rather, the result of a coherent strategy.” Also, in their haste to deliver on the goal, they misunderstand the business and brand strategy development process and try to fast-track it or gloss over it, he reports.

A book that can leave you devastated.

CEOs adopting a command-and-control business management style fail when it comes to recruiting and encouraging all members of the company to work together to deliver a product or a service that can effectively compete with compelling Western brands, explains Baladi. They fail not only to harness the energy and intellectual contributions of all the constituents they have on hand, not to mention their untapped intrinsic enthusiasm, whose loss or absence is impossible to measure, but also to create a culture that works to ensure that the customer promise is delivered on a consistent basis, he rues.

Two factors

Digging deeper into this malaise, what the author discover is that two factors contribute to the myopic perspective of CEOs. One, the anachronistic obsession by CEOs and their top executives with keeping everything ‘secret'; and two, the inability or reluctance to view the brand as a tangible asset.

As for the second problem, there can be help from professional accountants who can put a value to brand. But the ‘secrecy' factor is a more serious one, because it hinges on the common Asian belief that sharing plans with employees and external stakeholders can make the company vulnerable to competitors.

“Consequently, it is most often only the inner circle that is familiar with the company's direction and objectives. In many cases, however, not even the inner circle is appraised of these objectives or asked to contribute to their formulation…”

D. MURALI

(This article was published in the Business Line print edition dated January 30, 2011)
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