x Abu Dhabi, UAEMonday 22 January 2018

Business success must survive the cult of personality

Building an organisation around a certain person can at times be a stroke of genius and other times a ghastly error.

Building an organisation around a certain person can at times be a stroke of genius and other times a ghastly error. In the case of Apple, it is Steve Jobs and Steve Jobs is Apple. Back in 1985 when he was ousted from Apple, it didn't feel like Apple any more. Then with his second coming Apple has restored its status and is in its golden age. Likewise, Virgin and Sir Richard Branson are one and the same. Virgin Atlantic's brand values are fun, value for money, sense of challenge, innovation and quality. All of the things we'd associate with the personality of Sir Richard the adventurer, entrepreneur and author of the aptly named Screw It, Let's Do It: Lessons In Life.

When the late Anita Roddick, the founder of the Body Shop was sidelined by the company's board, for many including myself, the shine came off the brand. Roddick was the Body Shop. It was her passion as an environmental campaigner and her commitment to ethical business practices that forged the identity of the Body Shop. She defined the age of the ethical consumer and was one of the first business leaders to champion fair trade. Where she led others followed.

Nearer to home there are certain business leaders who have been so closely associated with their companies that they are seen as the company. Without them the organisation is not complete. Take Prince Alwaleed bin Talal bin Abdulaziz Al Saud of Kingdom Holdings. He is globally recognised as being synonymous with the brand. He is Kingdom Holdings just as Warren Buffett is Berkshire Hathaway. Both men are surrounded by a legion of highly competent executives, but they are the persona of their organisation, they are the brand.

But what happens to the organisational brand when there is a split between the person who has defined the brand and the organisation which is the brand custodian? How would we feel about Virgin if Sir Richard gave it all up and left to live the life of a wandering dervish trekking through the deserts of sub-Saharan Africa? Would it still feel like that same company? In the past few weeks there have been some prominent GCC personalities who have either acrimoniously split up with their organisations or brought considerable embarrassment to their former colleagues.

For starters there is Saad al Barrak, the former chief executive of Zain in Kuwait. He was seen by many analysts as the driving force behind transforming Zain from a local Kuwaiti operator to an extremely successful pan-Middle Eastern and African business. Under his watch the company grew its subscriber base from 1 million to 72 million and expanded into 23 countries. After his recent departure, which was apparently a result of differences with the board, analysts are talking about a leadership vacuum and questioning the strategy of the company.

There is talk of Zain being taken over. Private equity firms are dreaming about the management and performance fees they could earn as a result of structuring the acquisition of such a prized asset, while Zain's employees are having nightmares as to whether they face unemployment. And then there is Sulaiman al Fahim, ranked at number four in the Arab Power 100 list last year. Previously he bought, then sold Portsmouth Football Club in the UK, and also left Hydra Properties last year.

But despite that many still associate him with the Hydra brand, principally due to the publicity generated through the Hydra Executives television programme which he fronted so successfully. What all of the successful personality brands or organisational brands do so well is create a narrative about themselves. Apple is the purist fighting for design aesthetics and creativity against Microsoft. So in Apple's story arc, Microsoft is the antagonist. Similarly, Virgin Atlantic has been the fun-loving friendly airline compared with the stiff upper lip of British Airways. In both cases the chief executives, Mr Jobs and Sir Richard, played the role of the chief protagonist in the story.

But there have always been and will always continue to be a strong supporting cast without whom the protagonist will not achieve closure to their personal story. Where a great business leader has shaped the organisation in their own identity they have instilled certain core values throughout the organisation. This helps the organisation to be clear as to why it is different. Sir Richard famously remarked: "We give top priorities to the interests of our staff; second priority to those of our customers; third to shareholders."

His reasoning is that staff who are committed to the brand will through their sheer enthusiasm and behaviour delight customers and in the long term this will enhance shareholder return. Those organisations that built their brand around a personality only to see the strategy fall down, need to do what Mike Moser, the author of United We Brand, calls the Tombstone Test. What epitaph would they write on a tombstone if their company went out of business today? This will identify the values that are really important to the company.

So if BMW no longer existed, we would miss their comfort and engineering. For Virgin it would be their sense of fun, value for money and spirit of adventure; for Apple, their design and innovation. By going through this dewy-eyed remembrance, the core values which define the organisation come to the fore. These are the core values whether the leader stays or goes and ultimately it is these values that customers buy into.

Rehan Khan is a business consultant and writer based in Dubai