Visibility Creates Credibility to Set Expectations
Where have all the business leaders gone? Has public visibility for senior executives become more risky than it’s worth? Or has the current generation of leaders just forgotten how to speak up, after most cut their dialogue with broader stakeholders during the global financial crisis and slow economic recovery.
Does it matter? Is there a consequence to senior executives’ diminished desire to engage publicly to explain their vision, demonstrate values, put business results into context, and contribute to the dialogue about important public issues? From our experience and our ongoing research, we can say that reputation and brand are both at risk in organizations that do not use the powerful lever of executive visibility. There are several specific types of executive visibility that can be used effectively to help build the expectation of customers, investors, employees, policy makers and other stakeholders, and align those expectations with experience
Many organizations have come to feel that executives should avoid public dialogue about progress and the environment for growth, unless they are talking about their own company’s results. This narrow view may also reflect the belief among many business leaders that non-business audiences are so negative in their view of corporations that it isn’t worth the effort to engage.
But, in most parts of the world, the public appetite for listening to business leaders may be improving (and in many places, especially developing markets, the view of business as a source of progress has been more positive). After many years of declining regard for corporations, along with other institutions, corporate executives have missed an opportunity to rebuild confidence in business as a source of economic progress by not playing a more visible role in economic discussions around the world.
There is, and has been, a desire in almost every location for a continued flow of jobs and improved job security. It has become clear that stimulus by governments and corporate capital expenditures can only take growth so far. Business has a critical, global stake in this conversation, because strong economic growth will only come back, or be maintained, if job creation and wage increases for existing employees reignite consumer spending.
Several years ago, there was early momentum in the movement that advocated a perspective defined by the shared creation of social value by corporations. But, outside of the safer confines of business and economic forums, where leaders talk to each other, the heads of most major companies and other large institutions just don’t show much enthusiasm for a broader demonstration of leadership on big issues.
Is any wonder that other parts of society question the role of business, when the headlines are full of facts about companies avoiding taxes, sitting on piles of cash, using some of it to buy other companies, but only slowly creating jobs and hardly raising overall wages at all? Can it be possible that the highest-paid members of society, who lead armies of highly educated, creative problem solvers, have nothing to add to the public discussion about progress?
What is really going on? Of course, companies have good economic reasons to keep financial performance, and financial reserves high. And the best companies do contribute time, money, and ideas beyond their immediate business goals. But they say little about it publicly. And beyond shared value initiatives, most executives have not returned to the active posture of frequent communications, commentary, and public interaction on a scale that reflects the importance of business to society.
Does it matter that many senior executives today avoid making speeches and presentations or giving interviews, and instead generally focus internally on their role as “operator” of an enterprise, rather than “leader?” Do the outcomes that investors, customers, employees and other stakeholders value improve or suffer when top management avoids public engagement, or limits the dialogue to talking about the company itself.
Before we dive into possible ways to do that well, and reasons why it matters, here is a short quiz.
- Think about a movie, book, play or television show written in the past 50 years that featured a CEO or other corporate leader in a central role. Name an activity that would almost always be used to illustrate the act of leadership in those popular-culture vehicles.
You might have in mind an image of someone issuing commands from the head of the board room table, or barking orders into the phone. But if you are thinking more dramatically, you probably imagined a larger than life figure making an important speech, or otherwise stepping into the spotlight to introduce a product, or describe a vision of the future. Personal visibility in a “one–to-many” forum, at a podium or in the media, was considered for decades to be both a requirement, and a tool, of leadership.
- Now, think about the senior executives of recent times. Can you picture a CEO or other corporate leader in a public setting during the years of the global financial crisis?
That question might have elicited a mental picture of a Congressional hearing. A few years before that, many would have imagined footage of a highly paid executive who had cheated or lied, making the perp walk to a waiting law enforcement vehicle. But even in the depths of global recession, some senior executives stood out by communicating about possible solutions, policy initiatives, the creation of shared value—even if their own corporate results were less than certain.
- Finally, think of a senior executive stepping into public visibility today. Imagine that she is making a speech, or giving an interview to a top news organization, or testifying before a group of policy makers. While you are at it, think about the same senior executive speaking to a group of customers, or an employee town hall meeting.
Is your first thought about the risk he or she is taking? How the audience might ask tough questions? Are you imagining the senior executive saying, “Why am I spending my time doing this?”
Or are you imagining a successful moment of large-scale public persuasion that yields large scale benefits?
Although most businesspeople would agree with the statement “leadership is an act,” fewer are clear about “how much executive communications is enough.” In fact, that has become a somewhat polarizing question.
- “CEO as political candidate” is often discussed, but really is not an effective model. Many top executives object to being paraded around frequently to staged events. That’s a good instinct. Today, if you are one of the few who long for bombastic leaders, speaking in front of massive crowds as confirmation of importance, you are likely to remain unsatisfied except by the hour-long ramblings by the leaders of totalitarian regimes. The milder comparison to political campaign-style communications is only valid in limited ways. In fact, the risk of a political model for executive communications is that political campaigns are built around elections. There is one day to win or lose. For senior executives, every day is Election Day, and employees, investors, customers, and other audiences vote with their feet. Outside of the occasional industry forum, there are no moderated debates where carefully prepared leaders present their views. Effective leadership monologue has shifted to a focus on engagement and dialogue. This has been driven not just by changing communications technology, but by concerns and standards about leadership that are in many ways different from those of the past.
- Possibly you are in the “social media first, last and only” camp, wondering why an executive would bother with public dialogue that requires the slow mechanics of face-to-face encounters, rather than the efficient staccato of micro communications inside his or her network. While social media is an important ingredient in sustaining a discussion within and across audiences, we are not yet at the point where major companies can build their whole management character through those vehicles alone (unless social media is the primary business of the company).
- Or you may be in the “say as little as possible” category, because you think every statement by a leader creates risk. But experience tells us that the risk of being misunderstood as an organization rises as effective communications by its leader declines. Expectations go unmanaged, and companies can easily be portrayed by opponents as shadowy giants who take money out of the hands of others. Corporate and institutional leaders who under communicate face more challenges cutting through the competing noise to firmly create and manage expectations about their organizations’ goals, values, and outcomes.
It could be that many senior executives resist public communications because they came into leadership in the past eight or 10 years, when the priority was to micromanage decline in an attempt to limit the impact of the financial crisis and ensuing global economic malaise.
There is no universal solution to the question of who should speak, when, and how much. In many countries, strong silent leaders have been the cultural norm. In some cultures, the idea that the ultimate leader should be accessible to only a select few, seldom if ever commenting publicly, is a long-held bias. Everywhere, arrogance is a very concerning trait among leaders, so a CEO who takes the spotlight too often and speaks about a singular vision of success can trigger the wrong expectations.
Undoubtedly, you can name one or two senior executives who destroyed value for their organizations (public, private, or institutional) by publicly flaring their egos in an ongoing display of destructive narcissism. And you might name a few current leaders who seem naturally to have struck just the right balance between publicly describing their vision and simultaneously delivering successful execution, all wrapped in a warm blanket of approachable personality or avuncular wisdom. These extremes are interesting, but neither opposite proves the point for the majority of companies: fine tuning executive visibility is hard work, and it carries some risk, but done properly, it generates enough reward to be worthwhile.
Despite risks and concerns, there is still demand for the voice of the leader to define the vision, values, business objectives and outcomes for an organization of any type or size. Leadership communications matter because senior executives focus attention and raise impact of content. Simply put, if someone important is speaking, then more people listen. However, they cannot hope to be effective if they simply are talking about themselves and their own company.
Once we accept that there is gain from public dialogue, it all comes down to having something for the top executive or team members to say that is meaningful to the audience.
How should companies and their leaders determine what is relevant for an executive communications platform?
In an op-ed published upon his retirement as CEO of IBM, Sam Palmisano said that he used four essential questions as his guide to running one of the world’s largest companies. One of those questions was, “Why should society allow you to operate (your company) within their defined geography?” That question must be answered by any organization that wants the permission to operate and the opportunity to define and grow its own markets. Stakeholders evaluate those answers in many ways, but the most natural and effective is on a personal level, hearing from an individual who represents an enterprise in a responsible role. That is, a top executive, speaking in a setting where he or she expects to be held to his or her word.
We know from our FleishmanHillard Authenticity Gap research on more than 1,000 companies in 30 industries around the world that expectations about companies on six factors– “doing right,” credible communications, consistent performance, care of employees, community impact, and care of environment—have a major impact on purchase decisions even compared to the effect of traditional brand characteristics—innovation, customer care, and the perception of better value.
Theoretically, the process of building reputation and brand to support business outcomes requires at least three steps. Audiences must be informed, engaged, and activated by the brand or organization. That’s true whether you want someone to buy a product, take a job, make an investment, become a supply chain partner, or authorize regulatory relief. All of those, and many other organizational outcomes, require an audience to act or advocate in a particular way. All of those audiences choose to do so because it serves their own interests, on some level. But the starting point is awareness. Without awareness there is no reputation for the company or its leaders.
While there are many ways to achieve awareness, presenting information in the voice of an organization’s leader is a proven and efficient approach. While no top executive (except perhaps an incumbent national leader campaigning for reelection) should spend all of his or her time on public communications, it’s typically the earned media and personal interactions that create the most credibility for an organization, most efficiently.
Earned media, like interviews or personal participation in public forums, are a natural starting point for engagement. Engagement is a word that’s frequently used today, but in its simplest definition engagement stands for the attraction of an audience into an interaction, preferably a sustained interaction. Engagement starts with attraction. You have to want to participate, in order to be engaged.
Nothing is more attractive in most cultures than the opportunity for an individual to hear information on a topic of interest from “the source.” That is, from the highest authority, from an expert, from a decision maker or top influencer. Why are those sources compelling? Because they know more than we do, they allow us to listen and judge and feel like we are reducing our personal risk by being better informed. The premise here is, when a topic relates to a company or institution, there is no substitute from hearing the truth from the top.
Well, you might say, savvy audiences have plenty of their own information, so perhaps uninformed voters or average consumers are swayed by the voice of authority. But that certainly wouldn’t apply to, for example, investment professionals. In fact, investor perception polls repeatedly show that, after financial performance, the quality of the management team is the most important indicator used to evaluate company success. Putting that talent on display is productive even from the view of this critical audience.
To be effective, communications opportunities that position the CEO or other senior executives need to be both authoritative and engaging. That means executive communications must address the interests of the audience, as well as the company’s interests.
Executive visibility is both an advantage and a requirement for success, for any organization that requires the engagement and support of customers, investors, employees, policy makers and other stakeholders. It does not have to be time consuming, and it can directly support business goals. But it does require planning, preparation and careful execution, because personal credibility is a very valuable attribute for any leader. If you aren’t cultivating and defending executive visibility, you are leaving potential value on the table. That is inexcusable in today’s business environment.