Most Recent Articles In Business Features
Latest Business Features Articles
- Hamptons Season Begins With Discounts Already
- Growth in Asian Luxury Travel Slowing, but Still Strong
- Age Just One Attribute When Marketing to Consumers
More Articles By
Editor’s note: This is the debut of Think Tank, a periodic column written by influential industry and thought leaders.
Have a comment? Offer your point of view below.
This story first appeared in the January 14, 2013 issue of WWD. Subscribe Today.
Since stepping down some six years ago, after a nine-year tenure as a global chief executive, and having the opportunity to observe and study how other ceo’s handle the role, it struck me how much has changed and how much has remained the same in managing business.
As we begin 2013, the job is more demanding than ever. Being effective as a global ceo requires an intense effort across multiple fronts.
First, the globalization of American companies with major profit centers outside the U.S. adds to the complexity of the business. Spending real time across the globe to better understand the dynamics of a unique market takes stamina and energy. Becoming a student of the cultural nuances and preferences of each market and special business models therein, is a vital prerequisite.
The bar for talent in managing foreign affiliates has been raised. Competition for the talent is fierce. Today’s global ceo plays a vital role in attracting managers to operate these expanding yet complex, new profit centers, as well as motivating, managing and monitoring the executive across time zones.
It falls on the ceo to incorporate the learnings from these global markets into the overall corporate culture. Consider how many U.S. companies view China as being just as important as their home market. Thus, decision-making moves into these regions in a new dynamic way. How one keeps a brand’s vision and DNA consistent and intact, while adapting, tweaking, evolving its direction by regional market can make for some sleepless nights.
Second, the digital revolution and new technology has made change a part of a company’s life and has changed life in every company. The online business has forced management to constantly review their financial formulas, business models and strategies. The economics of a category, a collection, a product, a brand or a business model, can change rapidly. What worked last year may not work this year or the next.
Leading, managing and embracing change starts in the chief executive’s office. The consumer is driving this change: She wants to shop where, when and however she’d like. She is more aware of the choices available to her. Everything is a click away.
A ceo in 2013 must operate with great agility as he-she adapts and reacts and anticipates the fast-changing wants and needs of the customer. This Christmas past, revenue generated online with many companies surpassed the already aggressive growth that was forecasted. In analyzing results, bold moves will be needed in terms of investment by channel as direct-to-consumer continues to grow in importance. Tough decisions on the viability of retail stores, by location, will need to take place.
How brands communicate and inspire their clients has changed forever and will need further refinement. The client experience on a Web site, in a store or a wholesale shop-in-shop will need to be seamless for the customer. Those with congruent brand strategies across channels will lead the way and become the standard by which all others are measured.
Third, there is a heightened challenge due to the increased intensity of competition. The sheer breadth of competitors a company has to contend with would certainly keep me up at night! Gone are the days when companies were single-minded about who they considered competition: Saks worrying about Neiman’s, Estée Lauder about Lancôme. Today’s customer shops everywhere and there are no barriers to entry. Everyone is a competitor as luxury competes with mass, brand flagships with outlets, European shops with airport shops and everyone with Amazon and online-only shops. The challenge for a company is not only in its core products, but the service experience needs to be more compelling than ever in order to gain a competitive advantage. The dynamic of this competitive advantage is driven by the ceo.
Challenging, changing and complex are the realities of running a global company in 2013. So what does it take to be successful today? Yes, one needs integrity, intellectual capacity and curiosity, competitive drive, work ethic, analytical ability, creativity and strategic thinking.
However, the ability to lead, attract and motivate top talent, to build a first-class team, to establish a culture that minimizes politics, fiefdoms, egos and internal rivalries has become essential.
As the dynamics of channel, geography, category and competition change, a ceo must keep asking, “where do I add value today?” And what are the capabilities needed to run the company for tomorrow? “See the future” is one of Leonard Lauder’s great mantras. Be willing to change, admit mistakes, recognize lost opportunities, adapt, modify, evolve, delegate and forever keep learning.
The ability to simplify and distill a company’s objectives, strategies, branding, marketing — and vision — and be able to cut through complexity in order to provide clarity for all constituencies: direct reports, employees, customers, shareholders and boards is a competitive advantage for a manager.
But above all, love what you do. Love the people, the team, have passion for the product, the category, the industry, the selling dynamic, the company. Without this special ingredient, you won’t be as great as you can be.