Sunday, 7 December 2008

The Dangers of Branding Leaders (and Roy Keane)

Julie Hodges and myself are in the middle of writing an article on leadership branding, so I was intrigued by a recent post on the Australian HR online magazine (5th December, 2008, HR Daily), which appeared with the headline ‘Strong CEO brand improves candidate attraction and retention’
Citing a study by Minolta in Australia, ' Richard Branson (Virgin), Bill Gates (Microsoft) and Steve Jobs (Apple) are the business leaders Australian workers are most inspired by. Westpac CEO Gail Kelly was the only Australian CEO to make the top five list. Workers were also asked to identify which of the world's biggest companies they would most like to work for. Google topped the list, followed by Microsoft, Virgin, IBM and Apple. Locally based banks Macquarie ANZ, Westpac, followed by BHP Billiton, a mining company, ranked sixth, eighth, ninth and tenth respectively.

This headlining of leaders is further testament to the notion of ‘celebrity firms’ being tied up with celebrity leaders. Violina Rindova, and her colleagues in a 2006 article in the Academy of Management Review entitled ‘Celebrity Firms: The Social Construction of Market Popularity’ argued that a celebrity firm is developed from the media’s search for organizations that symbolize important changes in society by taking bold or unusual actions and which attempt to create distinctive identities. These firms are natural targets for ‘dramatized realities’ created by the business press. Google is one such firm that has become one of the most widely discussed success stories in the business press; also Apple whose products define the industry standard.

Most of the business press coverage focuses on the founders. For example, Google is often reported by referring to Larry Page and Sergey Brin. An Economist article of January 2006 portrays Page as the ‘visionary geek-in-chief', pronouncing at software conferences on the range of new products that will help Google achieve its ambition to ‘organize all the world’s information’. The storyline portrays the firm’s celebrity through Page’s missionary fanaticism, claiming that visitors to Google feel they are in the company of religious zealots rather than ordinary employees. Much the same story could have been written for Apple in the 1980s and, to a lesser extent, for Virgin over the last decade or so.

Though employees and the business press may feel the need to put leaders on a pedestal because of their requirements to find simple solutions to the complex problems of explaining why firms (and football teams!) are successful, are there dangers in doing so, and in having a corporate brand so closely linked to celebrity leaders?

My answer is yes. Much of the academic evidence points out that senior leaders don’t have a major impact on organizational performance. For example, Jeff Pfeffer and Robert Sutton claim that the hard evidence shows the impact of leadership on performance are modest under most conditions, strong under a few conditions, and absent in others. ‘Studies from leaders from large samples of CEOs…, university presidents to managers of colleges and professional sports teams show that organizational performance is determined largely by factors that no individual - including a leader - can control’ (‘Hard Facts, Dangerous Half-Truths and Total Nonsense’ p.192) Like a number of writers in this field, they also point to the dark side of leadership – narcissism, ruthlessness, group think and risky decision-making by people believing themselves to be all powerful. So, is it better to have leadership brands that are less reliant on powerful individuals and more on distributed leadership throughout the organization, i.e. build organization systems and brands where the actions of powerful and skilled individuals matter least. And should leaders act more wisely by knowing when to get out of the way so others can make contributions?

My own football team, Sunderland, provides a dramatic recent example of the problems of celebrity and wise leadership. Roy Keane, its talismanic manager, was over-loaded expectations by success-starved supporters seeking ‘instant pudding’ and a sports press always on the lookout for celebrity stories. Keane acted wisely by resigning when there were no calls for him to do so. He rightly expressed his self-doubt that no sane person could live up to such expectations (and implicit leadership theory –see earlier post) and resigned in as low key a manner as he could. Good for him and a lesson to other leaders (and firms seeking to brand themselves on the basis of individual leaders).

5 comments:

cv said...

Hi Graeme-

I share your concerns about the practice of tying the corporate brand too closely to the 'celebrity' brand of any given leader.

Although a powerful and well-defined leader/ personality can be attractive and even inspirational, there are too many problems associated with real persons as proxies for an organization's identity.

Rindova and her colleagues outline several of these problems, and there are even more (I've written some academic papers about them myself, focusing on the symbolic aspects).

But beyond mere symbolism, and in addition to the problems related to a person's personality as a proxy for the organization, there is also the very simple and significant problem of a singular person representing an organizational system. This practice puts too much power into the one person and not enough into the organizational system that actually creates and sustains the attributes that define the organization. Kind of like the "great man" fallacy. Apple not only is not Steve Jobs, it's more than Steve Jobs -- more complex, more shared, more resilient, more accessible.

I think that organizations should avoid emphasizing the relationships between their CEO or other spokesperson and the organization's identity beyond what stakeholders will do already. Instead, they should give more credit to the organization's systems and members collectively.

CV Harquail www.AuthenticOrganizations.com

inseiffolliet said...

graeme,

2 points.

the celebrity leaders you mention have become celebrity (!?) because of their amazing leadership skills which is the opposite to mr keane who essentially became a manager because of his football skills and celebrity (!?).

that said, mr keane's resignation may be due to his difficulty in accepting criticism and failure as evidenced by various episodes in his career, not least the irish world cup debacle.

i think the debate of whether football managers are successful leaders is seriously clouded by the end point analysis used particularly by fickle and urealistic fans. Only 1 team can win a league; that doesn't make the rest of the managers failures.

ffolliet said...

interesting comment here too

http://leaderswedeserve.wordpress.com/2008/12/06/roy-keene-great-player-charismatic-but-vulnerable-leader/

ffolliet said...

http://leaderswedeserve.wordpress.com/2008/12/06/roy-keene-great-player-charismatic-but-vulnerable-leader/

has other interesting comments on Keane and leadership

Graeme's HR Blog said...

Ross, we can discuss on Friday.

Have left a message on cv's excellent blog