The reputation of the CEO has been claimed to contribute up to 70% of the reputation of the organization.
That’s great with a “super-hero” CEO. But it’s dangerous when the leader insists on doing dumb stuff. A prime example was demonstrated this month when the CEO of internet giant GoDaddy, Bob Parsons, thought it would be a good idea to post online a video of himself hunting and killing an elephant in Zimbabwe.
The reaction from conservationists and animal protection organizations was prompt and completely predictable. However the reaction of Bob Parsons was somewhat less predictable. Instead of the conventional apology, he launched a detailed justification of his action, arguing that elephants are a major problem in some areas and that the local people had asked him to shoot the rogue elephant, which was reportedly destroying their crops.
That might be true, but it wasn’t the point. Parsons forgot that in issue and crisis management perception IS reality, and no amount of explanation could warrant the photograph of him triumphantly standing by the downed elephant with a gun in his hand. Yet he still tried. “When you see me smiling in that picture I’m smiling because I’m relieved that no one was hurt, that the crop was saved, and that these people are going to be fed – the type of smile when you get a good report card or achieve a goal.”
Of course that didn’t explain why the video zoomed in on some of the villagers wearing GoDaddy hats (those shots were later removed). And, as Time magazine online pointed out, Parsons is a keen hunter who has previously shot other big game in Africa. It was even suggested the whole episode was a publicity stunt for the internet provider. Regardless of the truth, and regardless of the claim that 20,000 GoDaddy subscribers cancelled in protest, the reality is that a rogue CEO undoubtedly damaged his organization’s reputation.
Sadly CEOs are only human – despite the image they may have of themselves – and corporate history is littered with leaders who made dramatically wrong decisions or whose personal failings damaged the organization – think David Jones CEO Mark McInnes who left after improper behaviour with a female employee, Energex CEO Andrew Kremor forced to resign after insider trading, BP CEO Tony Hayward whose mis-statements intensified an oil spill crisis, and his predecessor at BP who was forced to resign after a personal scandal.
The dubious benchmark for CEO failure may have been set in the 1990s, when Gerald Ratner, CEO of a British jewellery chain store, described one of his own products as “total crap” and said another would not last as long as a prawn sandwich. His remarks saw the company share value fall from two pounds to ten pence and resulted in 330 store closures and the loss of 2,500 jobs . . . including his own.
Communication professionals are often the people who need to provide frank and fearless advice to CEOs. In all of these cases, we will probably never know whether the CEO concerned was badly advised, or whether they got good advice and chose to ignore it. In fact it would be nice to think that not many CEOs are as spectacularly disastrous as the infamous Mr Ratner. But as Albert Einstein commented: “Only two things are infinite, the universe and human stupidity. And I’m not sure about the former.”