Most CEOs want their companies to do things right because that’s a sign of good management. But good management isn’t necessarily good leadership; good leaders are obsessed with doing right things. Good leadership creates strategic change, the forerunner to strategic advantage. CEO’s have plenty of generic strategic choices to drive a business forward. Most run the store by trying to do more of the same, but better. Yet, when things get tough, they soon revert to doing more of the same with less. I prefer specialist strategies—in other words, doing less, better.
Jacobs Suchard thrived as a chocolate and coffee specialist with brands like Toblerone, Milka, Côte d’Or, Nabob Coffee and Swiss Water Decaf. The acquisition by Kraft put an end to that. I know; I worked under the acquirer for the better part of a year. Inherent in the Kraft behemoth is a culture of doing more with less. Clout is the strategy.
The key to competitive advantage is setting the strategic game rules of the marketplace and shattering market paradigms with entrepreneurial leadership. Make the right move and your competitors follow. And while they scramble to catch up, you’re working out the next move on the strategic game board. That culture emanates from the CEO’s office. If a risk-averse CEO is recruited, an entrepreneurial spirit can dissipate in days.
A new boss charged with transforming a bureaucracy into nimbleness must shift the mindset of an entire organization. Yet, no matter how hard he or she tries, some people never change. Dismissal can wake the rest, but changing mindsets takes time. Three years would pass before Jacobs Suchard’s Canadian unit embraced the do right things culture. If you weren’t passionate, creative and competitive, you didn’t do well at Jacobs Suchard (aka Nabob Foods). A director of a competitor’s Board called us a ‘gang’. This was the ultimate complement. We viewed business as a combination of sport and war where success wasn’t enough; the other guy had to fail. Frankly, this isn’t necessarily the way to succeed in business. The mindset worked for us when the bank’s hungry wolf was at our door. But in my final years as CEO, it was senseless to engage in bitter wars that challenged margins. A competitor doesn’t have to fail; they too, can make a profit. But they cannot be permitted to lead; they must play catch-up. That’s how I played the game.