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CEO's with good communication skills worth more than money in the bank
In the wake of both President Zuma and President Obama's state of the nations addresses last month, its evident that most political and corporate leaders worldwide think they are good when it comes to their ability to communicate. But most delegate the task to their marketing or PR departments and few actually tweet and talk for themselves, corporate speech writers not withstanding.
One of the best communicators in corporate SA today must be FNB's CEO, Michael Jordaan. His intelligent, emotive and seemingly sincere opinion piece on the facing leader page of Business Day last week - following the controversy regarding the online extension of the bank's advertising campaign - deserves accolades.
So says Ruth Golembo, Managing Director of Lange360, a strategic communications consultancy which has for the past 25 years consulted to SA's top corporates, consumer brands and JSE-listed companies. (Disclaimer: FNB is not and has never been a client).
Golembo says that while most CEOs polled over the years rated communication skills as an essential attribute, very few actually took it sufficiently seriously to make it their personal responsibility.
And yet all the research shows corporate reputation and trust in organisations is generally closely linked to both the corporation's ability to communicate effectively and to the credibility of the top executive team including the CEO.
"The ability to communicate effectively at work - and even in one's personal life - is possibly one of the most critical skills," says Golembo.
"Going far beyond business issues, the ability to share ideas, thoughts and experiences has contributed to the advancement of the entire race. Poor communication is easy to find in underperforming companies, but luckily it's an area which can be relatively easily improved and measured. And generally speaking, effective communications can significantly and positively influence overall business performance."
But some CEOs don't realise that communication is a two-way process, Golembo says.
"In addition to getting your own message across, it is also important to employ active listening. As guru Peter Drucker said - the most important thing in communications is to hear what isn't being said."
The 2013 edition of the CEO scorecard, an annual study by Harvard University's Business school which rates the 100 best performing CEO's in the world using mainly performance data instead of popularity to score CEOs, shows most chief executives focus on short-term financial results at the expense of longer-term performance, Golembo notes.
The study concludes that CEOs were incentivised to make their quarterly or annual numbers, or else their compensation dropped and their jobs were in jeopardy. Stock analysts, shareholders, and often their own boards were tough on them if they missed their short term goals. In SA, there are numerous examples of board pressure leading to resignations which exacerbate the leadership vacuum in SA, she says.
The Harvard researchers - Prof Morten Hansen (management professor at Berkeley School of Information), Herminia Ibarra, Professor of Leadership and Learning and Urs Peyer, associate professor of finance - suggest it is essential to develop a way to gauge long-term performance and reward CEOs for this rather than for short-term decisions made under pressure.
"Whether FNB will loose business in the wake of the storm over its airing of the comments from young citizens amplified by FNB in the online space and this has a significant impact on the bank's profits in the short term or not, it is inspiring to see what is obviously a deeply committed CEO communicating so eloquently," Golembo says.
Jordaan in his article, made the point that FNB's advertising campaign was to "help" their customers and in fact the country at large. He says it was never their intention to offend government which would obviously not make good business sense. And he says it so boldly and clearly that one cannot help but believe him.
Lange 360's press office
|Lange 360 is one of the most influential communications consultancies in South Africa. It provides full-service communications for corporate, financial and consumer brands as well as investor relations, brand building, crisis communications, media liaison and a broad range of marketing services.|