I always look forward to Michael Maccoby’s visits to London. He is a wise and insightful observer of the world. I reviewed his most recent book The Leaders We Need for the FT a couple of years ago.
Last week he was in town, and he told me about the senior corporate executive who had once said to him: “Don’t ask business to save the world.” What the executive meant was that all the talk of do-gooding, of CSR, of ethical business, was all very well. But in the end private sector businesses have to make a proft to survive, and nothing can get in the way of that.
The kicker to the comment was the acceptance that better regulation – government intervention – very well may be necessary to save the world, and business would have to realise this too. “Give us a better game to play,” this executive had said.
Michael Maccoby explained it like this: if the game of soccer (football) was getting too dangerous, if people were regularly breaking their legs, you might want to change the rules. But you would still want the game to remain essentially the same. Maybe some of the rules of business will have to change if we want to save the world – on carbon, on water, on waste. But it will still be business. Governments and business will just have to work together on this.
I wonder what those business leaders, who lent their names to various political campaigns in the run-up to the British election, feel about the negotiations that have gone on these past few days in London? Did they strike them as being businesslike, orderly, professional? Is this how they would like to hand over power to their successors?
Business and politics rarely mix well, as I have noted here before. The last five days have only served to confirm me in that view. I wonder if businesspeople will be so quick to come forward to support any of the parties before the next election, whenever it is.
Well done Harvard. That is my immediate reaction to yesterday’s news that Nitin Nohria, professor of business administration at Harvard Business School, will be taking over as the schools’s new dean on July 1. He is not the “safety first” candidate. He is on the record as having declared – in the Harvard Business Review, no less – that managers have “lost legitimacy” in the wake of corporate scandals, and that business has a lot of work to do to win back the public’s trust.
Together with his colleague Rakesh Khurana, Prof Nohria has challenged the orthodoxy that claimed there was little wrong with the conventional MBA syllabus or with the approach taken by the élite business schools. Both of these things played a part in contributing to the over-confident mentality which dominated business and finance, and which led to the great financial crisis. By appointing Prof Nohria, Harvard University has signalled that it is not frightened of debate, or reform – indeed, it wants to play a leading role in both these activities.
Just about to take part in a conference call with Harvard President Drew Faust and Professor Nitin Nohria, who has today been named as the new Dean of Harvard Business School. He will take over on July 1.
This is an exciting appointment. Prof Nohria, with his colleague Rakesh Khurana, has led a vigorous debate on business ethics and the need to reform the MBA.
There will be a short news item on www.ft.com later today and more in the paper from my colleague Della Bradshaw in due course.
News broke over the weekend that the chief executive of the UK restaurant chain Little Chef has left the company. A few months ago I wrote about my less than joyful experience of eating at a recently revamped Little Chef outlet. There’s no need to rehearse the whole story again here. In summary: the company had hired the Michelin-starred chef Heston Blumenthal to advise them on updating and improving their menu. A TV camera crew had recorded this work and produced a rather upbeat and feel-good programme about a miraculous turnround at the company.
I was sceptical, especially after a somewhat disappointing meal at the flagship restaurant. I concluded my column by saying that the company would not be able to hide the truth from customers for long.
A couple of weeks ago I had another frankly horrendous meal at a Little Chef (do I ever learn? No I do not.) This branch was only another 40 miles or so up the road from the flagship one. They served me possibly the worst scrambled egg I have ever paid money for.
Now we learn that the CEO is out. Is the company’s heart really in this Hestonisation process? Does it have the competence to pull it off?
We are now roughly half-way through the British general election campaign. The country will vote on Thursday May 6. What was expected only a few weeks ago to be a fairly tame and predictable event has become much more exciting, on account of an innovation in British politics – televised debates between the three main party leaders.
The second of three debates took place last night. A commonplace in other mature democracies, the blockbuster election confrontation has finally arrived in the UK. It has upset the party planners and strategists, and overturned expectations.
So far so healthy. This is supposed to be a democracy, after all. But something is not quite right.
This cover story in the latest issue of Business Week, on changing times at General Electric, is well worth a read. I am a Jeff Immelt fan. He takes a lot of hits on behalf of CEOs everywhere, being one of the most famous corporate bosses in the world. But I know he doesn’t let it get to him, because I’ve heard him say so – “To hell with it!” is his attitude. He is not going to let the media define him.
Being CEO of GE is one of the hardest jobs in the world. But Immelt is candid, straight, thoughtful and, I think, pretty effective. We should not be writing him off just yet.
Some readers may be beginning to tire just a little of the tales of heroism some of us (me included) are inflicting on colleagues as we explain how, in defiance of volcanic ash and transport woes, we have managed to get back in to the office.
(Thanks for asking: stranded in Milan, I got a sleeper from Verona to Paris - grazie mille Fiorella Passoni of Edelman’s Milan office – and then found a suddenly available seat on the last Eurostar out of Paris last night.)
I finally got home at midnight, three days later than planned. Not nice, certainly, but not quite the nightmare others have suffered. I only had me to worry about. I managed to fit in a couple of decent meals too.
The more interesting point here is that thousands of us have been undergoing a practical exercise in crisis management. The familiar, steady-state world has been interrupted. We have been plunged into confusion. How have we coped?
Terribly sad news this weekend – CK Prahalad has died at the early age of 68.
There will be an obituary on www.ft.com later today (Sunday), and in the print edition tomorrow (Monday).
UPDATE: Here is the obituary of Prof Prahalad
Ten days ago the FT published my interview with Paul Polman, chief executive of Unilever, in which he made some strikingly robust comments on the (in his view misguided) theory that public companies should worry about creating shareholder value before anything else.
Several letters representing almost every possible point of view have since been published in the paper: derisory, technical, supportive, adulatory. My colleague Michael Skapinker offered his own wise perspective yesterday, and today we have published two more readers’ letters on the topic.
Is there anything left to say? Plenty. Yesterday my colleague Ravi Mattu and I had a fascinating conversation with Roger Martin, dean of the Rotman School of Management at the University of Toronto. He had some forceful observations to make on one of the key elements of the shareholder value debate: the idea that top pay should be tied to the company’s share price to align management’s interests with those of the shareholders.
Tomorrow I am heading to Milan to attend a symposium hosted by the European Academy of Business in Society (EABIS), which is titled “The future of economics and management in a post-crisis world”. Shareholder value is firmly on the agenda. I shall blog a few highlights when I get a moment to do so.
And I shall try and make some sense out of all this in my column next Tuesday (April 20).