My friend and colleague at the Medinge Group, Ava Hakim, passed on a few papers from her day job at IBM. The first is the latest edition of a biennial global CEO survey, while the second asks the next generation of leaders—Generation Y. The aim: to find out what these groups think about the challenges and goals for CEOs.
Unsurprisingly, both studies (involving thousands of respondents) had commonalities, though Generation Y placed global awareness and sustainability more highly on their list. Creativity, however, is ranked as the most valuable leadership trait. What society doesn’t need, they tell us, is the same-again thinking if we are to make progress in the 2010s. The old top values of ‘operational excellence’ or ‘engineering big deals’ no longer come up top in this new decade.
Or, as I heard from one gentleman yesterday, we can’t afford to have the sort of ‘experience’ certain people tout, for they do not have 25 years’ experience—they just have one year’s experience, over and over again, 25 times.
You know I’m going to say it, so I might as well: this sounds like the sort of ‘experience’ some of my political opponents have had, day in, day out. Groundhog Day comes to mind.
Indeed, the studies indicate that we have a far more complex world, and same-again thinking isn’t going to cut it.
In the first study (emphasis in original):
Creativity is the most important leadership quality, according to CEOs. Standouts practice and encourage experimentation and innovation throughout their organizations. Creative leaders expect to make deeper business model changes to realize their strategies. To succeed, they take more calculated risks, find new ideas, and keep innovating in how they lead and communicate.
The most successful organizations co-create products and services with customers, and integrate customers into core processes. They are adopting new channels to engage and stay in tune with customers. By drawing more insight from the available data, successful CEOs make customer intimacy their number-one priority.
Later:
Facing a world becoming dramatically more complex, it is interesting that CEOs selected creativity as the most important leadership attribute. Creative leaders invite disruptive innovation, encourage others to drop outdated approaches and take balanced risks. They are open-minded and inventive in expanding their management and communication styles, particularly to engage with a new generation of employees, partners and customers.
And:
Creative leaders consider previously unheard-of ways to drastically change the enterprise for the better, setting the stage for innovation that helps them engage more effectively with today’s customers, partners and employees.
The study also highlights an increase in globalization, especially in developing markets, leading to greater complexity. It also says the most successful leaders are prepared to change the business models under which they operate.
In fact, the world we now live in demands that our leaders are globally aware, and see the need to compete in a global market-place.
The implications for this city are that Wellington can no longer afford to see itself as merely the capital of New Zealand or the geographic centre. It is one of many cities that must compete for attention and resources at a global level—which means creating world-class centres of excellence for our industries. Creating such clusters can even help them stay domestically owned.
The study indicates that the style of leadership is going to be, necessarily, internationalist—which means we can’t afford to have leaders who are monocultural, and fake multiculturalism. This, like any aspect of a brand, must be embodied for real. It doesn’t mean giving up what ‘being a New Zealander’ is; it does, however, mean that we have to be able to communicate with other nations and cultures, seeking advantages for ourselves.
Innovation is a driver both in terms of internal processes and as a core competence—so leaders had better be prepared to do this. And being closer and more transparent with customers—or in the case of a city, citizens—is something practised by the most successful leaders, says the study. It reminds me of the topics in the first book I contributed to, Beyond Branding—where integrity and transparency were at the core.
When it comes to the Generation Y study, the results were similar. This table summarizes the two quite well, and notes how the two groups differ:
I don’t want to be giving the impression that the second study is less important, but realize that some of you are sorely tempted to see me wrap up this post.
I will say, quickly, that the lessons are clear: the next generation expects leaders to be globally minded and sustainable.
Chinese respondents in the second study, in fact, valued global thinking ahead of creativity. This perhaps highlights where the People’s Republic, above the other Chinese territories, is heading: looking outwardly first and delivering what customers in export markets want.
As creativity is naturally a trait among Wellington businesses, it’s nice to know that many are already prepared for the challenges of the 2010s. And some of our most successful names would not have got to where they are without global thinking, even if some have been acquired by overseas companies: 42 Below, Weta, and Silverstripe come to mind.
However, I can’t see these traits being reflected in politics—and that’s something I hope we can change in the local body elections, for starters.
Certain media are reporting the city’s [debt] in the $200 million–$300 million mark but our outside-council research reveals this is a very conservative estimate. It’s likely to be more.
Regardless of whether it’s $200 million or half an (American) billion (scary just saying it), any deficit that’s nine digits long can’t be good for a relatively small city.
One of my plans after I get into office will be to balance the budget, which is why I have been going on about growing jobs and businessesin such a big way. In a very shortcut way of explaining it: more new businesses, more ratepayers, fewer reasons to increase the rates. Which, I might add, this current administration has already locked in for us over the next few years, letting the next mayor get the blame.
I object to any cuts in library services, even if there is a strong denial that that is happening. In a knowledge economy, we cannot afford to create a class system of the knowledge-rich and the knowledge-poor.
On this note, recently I asked Don Christie of the New Zealand Open Source Society to examine an open-source strategy for Wellington City. For starters, we discussed how the library software is a proprietary system that costs this city a considerable amount—when there is a New Zealand-developed open-source program that many other cities have implemented.
While it would be nice to keep believing we can afford expensive software to run city services, I don’t like debt, and I certainly don’t like owing people any money.
And I’m not prepared to sell off our water to technocrats or any profitable part of the family jewels to see the hundred-million figure reduced.
There are good examples of open source working for cities and creating significant savings. Zaragoza, Spain, has been moving to a complete open-source desktop. And it’s not the only one.
Furthermore, open source will mean jobs in Wellington. This will mean new jobs. I have already gone on about the tech clusters being a vital part of this city’s economy. Open-source skills are in high demand, and if overseas trends are anything to go by, we can attract these skilled people to our city. Already Wellington is a centre of excellence in many IT-related fields. I’m talking about extending this and making a real claim to open-source. Let the world know that Wellington is the home of not just the most advanced software and visual effects’ companies, but logically extend that to open source as well.
It’s projected that by 2020, 40 per cent of jobs in IT will be open-source-related, so if we don’t do it, another New Zealand city will. I’m not about to give up one of our most important advantages, one which has been emerging in the capital since the 1990s.
Such moves can be done with the city and Wellington’s private enterprises working together—but this will need to come from the top, and be put in motion by a mayor who’s passionate about job creation. It’s one of the biggest challenges we face, and I seem to be a lone voice on focusing on this for our city.
Rumour has it that the new Saab—a small car (finally)—will resemble the ur-Saab, the 92. In fact, inside Saab, it has the codename 92.
Where have I heard this one before? I know. Stefan Engeseth’s Detective Marketing, 2001 edition. And from what I understand, since in 1999 I could not read much Swedish, it featured in the original Swedish edition, too.
While I am no fan of retro design, a modern one that has strong inspiration from Saab’s roots could go down well with the market—especially if the new 9-1 model had some advanced, non-fossil-fuel powertrains.
A car tied to Saab’s roots as an airplane manufacturer could reinvigorate passion for the brand in the same way as the Jaguar mascot unveiling under John Egan in the 1980s. And new boss Victor Muller, CEO of Spyker, has wasted no time getting Saab loyalists excited about the brand again. He has not set his sights on brand-new customers: he wants the old Saab buyers back.
While it might have Opel underpinnings, it at least gets Saab into the European premium compact car game, one which GM denied it, probably due to overlap with its mainstream brands. It was an opportunity missed as BMW, Audi and others broke in to the compact and supermini game.
I know at least one Swede who finds Muller’s promises exciting, and I sincerely hope to be proven wrong when I expressed doubts about bringing a 40,000-sales-per-year company back from the brink. Below is the announcement of Spyker finalizing its purchase (via Detective Marketing).
When he talks about ‘DNA’, Muller really means brand: it will rediscover and redefine that brand and its entrepreneurial spirit, using it to fuel the corporate culture, and having that drive product quality, R&D and other functions. If he succeeds in reaching his 100,000-per-year goal, then we can say that brand loyalty was a huge driver.
His first announcement alone has been praised, Saab’s 100-day plan gives distributors and loyalists some certainty, and the folks in this video actually look enthused—already this is not like a tired, Rover-style attempt at getting the company back on its feet, even if the annual sales’ figures are far worse than what the English company had prior to its collapse.
I was surprised to learn that Toyota still has not issued a worldwide recall of its troublesome Prius NHW30 model, even though one had gone out in New Zealand.
In layman’s terms, the brakes allegedly don’t work when you want them to. In more complex terms, the software has trouble distinguishing between different types of braking, and drivers may experience a delay in ‘pedal feel’.
I was always a bit sceptical about the recalls over the unintended acceleration, given that the last time I heard those words, they were in relation to a falsified report from CBS’s 60 Minutes, a show known to me for making up stories (Killian memoranda, anyone?). Hearing them again, I thought it was just another excuse for the clumsy driving of a few individuals who couldn’t figure out where the accelerator was (which was what happened with Audi in the US). But it seems this matter has been around for a long time, and recalls were being done even last year.
But the Prius matter, something that has not come under a global recall, appears more serious than carpets getting in the way, which is the problem behind the unintended acceleration complaints. AFP reports:
The Transport Ministry has received some 80 complaints in February about malfunctions in the brake system of the latest model of the flagship Prius, the Tokyo Shimbun reported without quoting sources.
Five of them were actual crashes in which the drivers claimed the brakes did not work properly, the daily said, adding that the ministry would urge the company to launch an investigation.
It was not possible to immediately confirm the report.
Already Toyota has been berated by top management for going too far from its core principles by its honorary chairman, Shoichiro Toyoda. The company had been trying to sell big cars in China during the financial crisis, and spent a good part of the 2000s developing large pick-up trucks for the US market. Bloomberg reported last June that a meeting was called:
Shoichiro scolded the president [Katsuaki Watanabe] for being so anxious to boost sales and profits that he’d let Toyota emulate now bankrupt General Motors Corp. and Chrysler LLC. Toyota had become addicted to big, expensive cars and trucks and had forgotten the customers’ need to save money, Shoichiro said, according to the person’s account.
In other words, Toyota’s culture has been suffering, and we all know what happens when sales’ volume and profit are pursued at the expense of quality or engineering. (Ask Mercedes-Benz.)
Toyota may be an example where too many niches were created, simply to get consumers in the showrooms—and now that’s coming to bite it on the rear end. Having too many niches has one immediate drawback: consumers no longer understand the structure of the range. Is the small car the iQ, Ist, Vitz, Porte, Belta or Passo? Do I move from that to a Corolla, Auris, Blade, Corolla Rumion, Probox, Raum, RAV4 or wotsis?
The mistakes are understandable in some ways. Toyota had to create more new models as attention spans shortened. While a car might be able to be presented as “new” for two years in the Japanese market 10 years ago, consumers expect something else within half a year. To fund this appetite, the company looked for ways to maximize profits in every market—with the US one fuelled by bigger and bigger vehicles. It had to take costs out of cars, especially with electronics (by combining as many functions on to one system as possible) and architecture—and it may be these areas where the Prius suffered.
But no company can really afford to pursue too many niches—Mazda overextended itself in the late 1980s and early 1990s, as did Nissan in the early 1990s—when times are tough. Toyota should have forecast a downturn, as many business experts did. The question that the company needs to ask itself is: what made it so blind in the 2000s?
Even ignoring the idea of unintended acceleration for now, Toyota ends the lunar year on a low. It will always have its diehard followers—there are many models not affected by these issues—but the company must refocus its brand for the New Year toward its traditional principles. There is every sign the company knows that, with Akio Toyoda, the founder’s grandson, now at the helm, and doing spot checks down on the production floor. (I’d rather Toyota have someone like that than a “celebrity CEO” who gives good press. The era of the celebrity boss is over for now.) It is simply a pity that the company did not get on to its mounting problems—there are claims that unintended acceleration reports began surfacing with Toyota’s Lexus ES model as early as 2004—sooner.
Few buy a Toyota because the cars make one’s heart beat faster. They are a default choice for many people who want the simplest conveyance from A to B. Akio’s job has been reminding his own team of that, and reinstituting the ‘Toyota Way’ and kaizen, terms that many of us who went to business school during a certain era recall.
