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Leading in Turbulent Times

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Shows what every leader must do to cope with perpetual change -- the key characteristic of twenty-first century business
Provides unrivalled access to the best managed boardrooms in the world through unique interviews with some of today's most resilient and innovative leaders
Combines inspirational anecdotes and case studies with solid, pracitcal advice

Turbulent times are here to stay. The global recession is today’s current dramatic headline, but accelerating change and economic uncertainty are the hallmarks of twenty-first century business. Signs like the volatility of commodity prices and fluctuations in currencies are all part of a broader weather system affecting business everywhere. These powerful forces for change are the corporate equivalent of headwinds, something which must be faced and navigated by all leaders and those they lead. The challenge of the next few years is learning to maneuver confidentially in perpetual turbulence.
So what should you do as a leader to keep your business on course? Kevin Kelly and Gary Hayes have interviewed frontline leaders with proven track records for adapting to rapid change and helping their companies thrive. In Leading in Turbulent Times these extraordinary executives—from such successful international companies as McDonald’s, General Electric, Nissan, Coca-Cola, Kaiser Permanents, Marks & Spencer and more—share how they have confronted the challenges every leader must now face.
You’ll discover how to recognize the early signs of rough seas ahead and mobilize and inspire your people to respond. Kelly and Hayes explain what top leaders do to chart new strategies that build on existing strengths and, when necessary, change direction quickly and decisively. But a different course is not always welcomed by everyone, so Leading in Turbulent Times offers advice on putting down mutinies in ways that acknowledge legitimate concerns without distracting or alienating loyal crewmembers. And they focus on how to cope with the personal stress that comes with guiding your organization and your people through the turmoil.
Leading in Turbulent Times shows how you can use change to your advantage, at a time when everyone else is being blown off course.

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26 Chapters

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1 All change


‘My own world has changed. I just don’t think we will be able to put the genie back in the bottle. There will be a new business order coming out of all of this.’

Henry Fernandez, president and CEO of MSCI Barra

Fast, turbulent, mind blowing, exciting, scary. It has never been more difficult to make sense of the world.

Change rules. ‘Our sales are half what they were this time last year, which is a challenge. But I think we’re in the same place that a hell of a lot of other people are in right now’, one CEO told us. ‘The focus on performance is finer. When you are growing at 35 per cent everybody benefits; when your growth goes down to 11 per cent or 12 per cent, the separation between the poor and the best performers increases. And then you need to figure out how to handle it, because in this environment you cannot let that rise. We have had to let some of those poor performers go.’

Over the past three recessions in 1981, 1991, and 2001, the car rental company Hertz never experienced its annual sales contract more than 3.5 per cent in any given recession. In November and December 2008, it saw a 20 per cent fall. In January 2009, Hertz announced a reduction in its global workforce by 4000 employees in a bid to decrease costs due to reduced rental demand. Hertz had already reduced its workforce by 22 per cent in the past two years.


2 Knowing when the winds are coming


‘I’ve been practising Japanese martial arts since university and one of the concepts you pick up is that you learn to read energy, people energy, body energy. You see the person, he’s going to move, you see a punch, you see a kick, you see everything, but there’s something else and by beginning to read that something else gives you a competitive advantage.’

Bijan Khosrowshahi, Fuji Fire and Marine

K.V. Kamath is chairman of ICICI Bank, the biggest private sector financial services group in India, as well as being the country’s largest private equity player, the biggest life insurance and general insurance company, and the third largest asset management firm.

As we spoke, K.V. Kamath was preparing to become chairman of the company, having been CEO since 1996. It was a mark of his leadership style and achievement that he was handing over to a 47-year-old woman who had risen up through the bank. K.V. Kamath’s entire business philosophy is built around creating a meritocracy, encouraging young talent and promoting superior performers to powerful positions at an early age. His commercial insight can be neatly summed up as speed equals capital.


3 All hands on deck


‘My experience being a CEO for ten years is that you’re much better off being transparent and communicating frequently with your employees as to what you’re doing and why you’re doing it.’

Mark P. Frissora, Hertz, Chairman and CEO

Every week George Halvorson writes a letter to over 160,000 people. The chairman and CEO of Kaiser Permanente writes a note celebrating something someone in the organisation has done. ‘Usually the letters are about us as people, the people at Kaiser Permanente; these are the kinds of things that we do; these are our values; these are our accomplishments. They’re typically things that are illustrative of a collective effort’, he explains.

Halvorson has been in the letter writing habit throughout his career. His weekly letter has become a fixture over the last two or three years. Previously it was a 10- or 12-page quarterly letter, something he has been writing for 20 or so years since he ran a plant in Minnesota.

Named CEO and chairman in March 2002, Halvorson has over 30 years of healthcare management experience. Kaiser Permanente, founded 1945, is the US’s largest non-profit integrated health plan, serving more than 8.6 million members in nine states and the District of Columbia.


4 Navigating a new route


‘Clients come first. Relationships are tougher, pricing is hard, issues are more intense, companies are struggling, so I spend a lot of time with clients. You’ve got to leverage yourself deeper into the organisation, use the skills of all your people, and use the processes you built in good times to cover the tough times.’

Sam DiPiazza, PwC

‘It is vital to see this challenge as an opportunity, to boldly face up to it, and to continue to provide value to customers’, says Kazuyasu Kato of Kirin Holdings. Tom Glocer phrases it differently though his sentiments are much the same: ‘Terrible markets are a great time to extend the amount of open water you have on the competition.’

Or take this view from Ed Dolman of Christie’s International: ‘Over the last few months, despite the obvious disappointment at suddenly seeing revenues falling and remuneration levels being reduced, and going through a lot of the painful aspects of downsizing the business and letting people go, there is a real feeling that we’ve got an opportunity to take back the company, shape it to how we want it to look for the next two, three years, that there’s much more control being applied, and that we’ve got much more control in this market. There’s a more stable working environment, people are basically much happier with their lot. There’s less poaching going on, they’re glad to be employed. It’s a totally different environment to manage in, and it does mean that you feel empowered to influence some of the changes that you’ve been trying to make over the last two or three years but just haven’t been able to put in place because of all the other pressures of growing the business and hanging on to your top staff.’


5 Mastering mutinies


‘The bigger the company is, the more the job is really managing the people, putting the right people at the right place, thinking about the future of the company, trying to bring everything under one roof, setting the strategy.’

Monika Ribar CEO of Panalpina

A young manager had a highly delegative management style. He delegated as much as he could and took great pride in doing so. Then a crisis arose and he needed things done and done in a hurry. He became more authoritative – we need to do this, we need to do that, I need you to do this by Friday, he told people. Did they rally to his flag? Did they appreciate that his formerly easy-going management style was a luxury the organisation could ill afford at that precise moment? No, of course not. The result was a complete backlash. His staff rapidly reached the point of rebellion.

Puzzled by this, the manager went to his boss and explained that his staff were mutinous and emotionally distraught. His leadership was simply not working, he confessed.


6 Learning to tack


‘In the face of this unprecedented challenge, the single most important quality that every CEO, banker, portfolio manager or politician should possess and display is agility.’

Tom Glocer, CEO, Thomson Reuters

‘Agility has been a major theme and a competitive advantage in our company in the last nine months’, Henry Fernandez told us when we talked. ‘Prior to the financial crisis, our business lent itself to long and studious deliberations given the longer term, steady and subscription nature of our business. By October of 2008, we realised our clients, mainly only asset managers and pension funds globally, were undergoing incredible changes in their purchasing decisions due to the enormous declines in their revenues (asset-based fees dropping substantially in a very short period). Some clients and prospects needed our tools and had money to spend. Others had the demand but did not have any budgets to purchase. The problem was we did not know which was which. Sorting this out within weeks or a few months was a challenge. We needed to act fast. Otherwise our sales would drop precipitously.


7 Living with turbulence


‘Keeping your energy going is at different levels. First, you have to discover something exciting to do in the organisational context. You have to try and celebrate the building of the vision. You have to work with younger people to keep your energies going. You have to have an entrepreneurial mindset, and I think finally you also need to reinvent yourself every year. In today’s world you are obsolete if you are not doing that. If I look at the last 10 years, if I hadn’t reinvented myself I would have fallen by the wayside long ago.’

K.V. Kamath, ICICI Bank

There’s a powerful children’s book called The Giving Tree by Shel Silverstein. It is a story about a tree and a little boy.

Every day the boy comes to swing on the tree’s branches, to eat its apples and sleep in its shade. The boy loves the tree. And the tree loves the boy. But as the years pass the boy finds other things to do and the tree is often alone.

After much time has passed, the boy comes to the tree and asks for money. The tree suggests he picks its apples and sells them in the city. This makes the boy happy; he picks all the apples and goes away. And he stays away for a long time.


8 The leading turbulent times checklist


‘What often happens when you have a time of crisis and things get really tense and don’t go quite the way you would like them to is that you all work better than ever before.’

John Brock, Coca-Cola Enterprises

As we come to the end of our navigation story we want to remind you of the three key ingredients needed for any leader in these turbulent times: passion, people skills (especially communication) and maintaining a long-term big vision.

Turbulence will continue but that does not mean that opportunities come to an end. ‘Don’t change your dreams, that’s what I would say’, advises PwC’s Sam DiPiazza. ‘Don’t rashly decide, well, with all this uncertainty, I’m not going to pursue my long-held ambitions in finance, I’m going to go be a window washer. It might take a couple of years but this will pass, so keep investing in yourself and fight your way through it. If you invest in yourself, keep your dream, you will find a bridge from here to there.’

Ask yourself, how can we benefit from this? How can we come out the other side stronger? ‘I’m a very positive guy to begin with’, says Victor Fung. ‘I get myself fired up, and our people fired up by thinking about the opportunity side of the crisis. The initial reaction of course is fire fighting, everywhere you’re putting out fires, but very soon you say, hey, look, out of all this there’s a real opportunity, and start focusing on some of the opportunities. How we can strengthen ourselves. How we can strengthen our entire staff building skills? How do we improve our market position in the industry as we face this downturn? By focusing on the opportunity, I think we manage to energise ourselves.’




action 71–3, 96, 100

adaptability 70, 104, 106

advertising 5–8

agility 101–3, 119, 148–9, 150

cognitive 8–9

cultural 149

ICICI Bank 104–5

Infosys 106–10

PricewaterhouseCoopers 105, 106

as state of mind 111

willingness to learn 115

Al Zain, Talal 51, 143, 152

Allen, Paul 139

Álvarez, José-Luis 130

‘ambidextrous organisation’ 107

ArvinMeritor 132

Asia 117

AstraZeneca 141

Avon 16

Baker, Richard 138

Ballmer, Steve 142

Balls, Ed 30

Barrett, Craig 142

Birkinshaw, Julian 10

BlackBerry 45, 63, 64, 122

blogs 64–5

‘blue ocean strategy’ 105

boards of directors 62–3, 140–1, 142–3

Body Shop 139

bonuses 155

Boyatzis, Richard E. 76

brand building 65

Branson, Richard 139

Brazil 17, 19

Brock, John 20–1, 64, 71, 145

Brown, Gordon 3

Buffett, Warren 52

Cadillac Fairview 43

CAN see Chief Advisor Network

Carrefour 141

cash management 153

Caterpillar 13–14, 137

CEOs see chief executive officers

chairmen 140–3

change xx, 1–4, 70

advertising 5–8

agility 102–3, 106

macro-economic and political 12–13

organisational 9–12

readiness for 32

resistance to 93

technological 8–9




We would like to thank all those leaders who found time to talk to us about their own approach during these turbulent times. In particular, thanks are due to the following:

Talal Al Zain, CEO, Bahrain Mumtalakat Holding Company
Richard Baker, Chairman, Virgin Active
John Brock, Chairman and CEO, Coca-Cola Enterprises Inc.
Sam DiPiazza, Senior Partner, former Global Chief Executive Officer, PricewaterhouseCoopers
Edward Dolman, CEO, Christie’s International
Carlos Fernandez, Chairman and CEO, Grupo Modelo
Henry Fernandez, Chairman and CEO, MSCI Barra
Tim Flynn, Chairman, KPMG International
Mark P. Frissora, CEO, Hertz Corporation
Victor Fung, Group Chairman, Li & Fung Group
Carlos Ghosn, President and CEO, Nissan; President and CEO, Renault
Tom Glocer, CEO, Thomson Reuters Corporation
Rick Goings, Chairman and CEO, Tupperware Brands Corporation
Kris Gopalakrishnan, CEO, Infosys Technologies Ltd
George Halvorson, Chairman and CEO, Kaiser Permanente
Wang Jianzhou, Chairman and CEO, China Mobile Limited
Kazuyasu Kato, CEO, Kirin Holdings
K.V. Kamath, Chairman, ICICI Bank
Bijan Khosrowshahi, former CEO, Fuji Fire & Marine
Seung-Yu Kim, CEO, Hana Financial Group
Yorihiko Kojima, President and CEO, Mitsubishi Corporation
Bruno Lafont, Chairman and CEO, Lafarge
Richard Langan, Managing Partner and CEO, Nixon Peabody
Anand Mahindra, Vice Chairman and Managing Director, Mahindra & Mahindra Ltd.
Chip McClure, Chairman, CEO, and President, ArvinMeritor
Alexey Mordashov, CEO, Severstal
James Owens, Chairman and CEO, Caterpillar
Takeshi Niinami, President and CEO, Lawson Inc.
Monika Ribar, President and CEO, Panalpina
Stuart Rose, CEO and Chairman, Marks & Spencer
Peter Sharpe, President and CEO, Cadillac Fairview Corporation
Jim Skinner, Vice-Chairman and CEO, McDonald’s
Nick Stephan, founding Managing Director and CEO, Phoenix Partners Group
H. Patrick Swygert, former president of Howard University
Linda Wolf, former Chairman and CEO, Leo Burnett


























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