The Virgin Way: Everything I Know About Leadership (10 page)

A MAN, A PLAN, A MANIFESTO

Along with Hemingway’s six-word story, the other piece of clever writing that stuck with me from school was the longest palindrome (something that reads the same backwards as forwards) I have ever seen. It reads,
‘A man, a plan, a canal – Panama.’
But I am getting off track. As memorable as they might be, I am not suggesting palindromes would make good mission statements but when I first read Active’s Guide document it struck me that it was neither a mission statement nor an employee handbook; if anything it could probably be best described as a ‘manifesto’.

Hopefully that word hasn’t been too tarnished by the way it is used by a lot of politicians running for office where the definition of a manifesto would frequently be ‘a series of empty promises’. I have to say, though, that given the paucity of good mission statements out there, the time may be ripe for a change, and so ‘manifestos’ may be the way to go. Certainly in popular usage at least, a manifesto does seem to imply much more of a call to action than any mission statement, however well written.

So consider if you will the manifesto produced by Ron Faris who was formerly head of marketing for Virgin Media and has just started Virgin Mega, one of our newest businesses. Its purpose is to sell – oops, Ron wouldn’t approve of that word. Its purpose is to ‘enhance the discovery of all things around music’. It features a mobile app where fans can get in-line online to acquire limited edition goods, play all kinds of fun games and enter contests to jump the queue. It also features real-life bricks-and-mortar pop-up stores with all kind of limited edition clothing, art, concert tickets etc. around specific popular artists and upcoming shows where waiting in line is an important part of the mission – a visual demonstration of your fanaticism. There is also a website where fans can get in-line-on-line to acquire the same kind of limited edition goods and play all kinds of fun games and contests to jump the line. But let me have Ron explain it as he does in his ‘manifesto’, which I found to be an extremely emotive document:

‘
These days, too much is for sale. More energy is spent on the convenience of what to buy rather than the passion for what you’re buying. Nothing stands for anything any more. Everything is everywhere. Convenience has no soul. It’s time to take retail back. Take it all underground. If the world is about ubiquity, then we’re about scarcity and intimacy.

Virgin Mega sells products inspired by bands and pop culture that you can’t find anywhere else. We thrive on the
“
now
”
. Not what’s coming in ten minutes or what happened ten minutes ago. It’s about what’s about to happen. That moment between the line you waited in for hours and its epic payoff. The
Hype.

Virgin Mega is not about shopping. It’s about hunting and coveting. True fans wait in line. In rain. A lot. Because they care. And sometimes what you go through to get the things that rock is just as rewarding as what you get. It’s the experience. The friends
’
n’ things you discover while waiting in that
line.

Virgin Mega is for the fanatic. Whatever makes you tick. The more you love music the more we love you. We’ll bring you closer to the artists you love by serving up clothes, kicks, art, and tickets. All inspired by the music and pop culture you dig and all of it fuelling the addiction you have to lifestyle. All our products are limited and numbered. Sometimes what we sell won’t be easy to find. And sometimes if you’re not paying attention, they’ll vanish before your eyes. For ever. You’ll have to pay attention. You’ll have to prove your fanship. You’ll have to wait in line. A lot. And you’ll love every minute of it. Come hang at Virgin Mega. Unlock what rocks.
’

So if that isn’t enough to move you over to pithy, engaging manifestos rather than old-fashioned wimpy mission statements, then I suspect you’re a lost cause.

I’m kidding, of course, but if you must have a mission statement, above all else I urge you to keep it real, make it unique to your company and keep it concise. And when you’ve done all that, just for fun, give it what I call the ‘escutcheon test’ – try to imagine it on the bottom of a heraldic coat of arms. Maybe it’s a throwback to my old school motto or something, but I have always thought that if the Virgin Group were ever to adopt such a motto, then something along the lines of

‘Ipsum Sine Timore, Consectetur’

would look incredibly impressive on a scroll right below our familiar red Virgin logo.

Loosely translated from the Latin this means ‘
Screw It, Let’s Do It
’ and, as mission statements go, that’s about as real as it gets!

And its multiple myths

‘Leadership is the ability to hide your panic from others.’

Lao Tzu (sixth-century Chinese philosopher)

Based on the above, it seems that some key leadership skills haven’t changed much at all in fifteen centuries. I can definitely relate to this one but in the early days of Virgin, at least, I might have been more specific and tweaked it to read, ‘Leadership is the ability to hide one’s panic from your bank manager!’ Something I apparently failed to achieve immediately after the launch of Virgin Atlantic when, fearing we were getting in way over our heads, Coutts Bank pulled the plug on our account. Needless to say we quickly found other sources of more imaginative funding, but Lao Tzu would presumably have been less than impressed with my performance.

‘THE ANSWER’S YES. NOW WHAT WAS THE QUESTION?’

In the early days of Virgin, one of our people nicknamed me ‘Dr Yes’. It was a friendly (I hope) dig at my perpetual eagerness to go along with trying new ideas. Only I knew that in part it might also have something to do with my inherent dislike of confrontation. I also mused on whether my new nickname was possibly driven by my strong resemblance to Sean Connery in his portrayal of James Bond in the 1962 movie
Dr. No
, but I fear that was just wishful thinking. Anyway I did have to laugh many years later when I read somewhere that then British prime minister, Tony Blair, had said, ‘
The art of leadership is saying no. It is always very easy to say yes.
’ Hmm, looks like I lost out on that leadership trait as well!

One very positive and rapidly spreading development in the modern definition of leadership is how it is becoming much less about power vested in a single person or role, and more about a collective process in which the authority and power is shared by a group with a shared interest. The way in which the Elders tackle major conflicts and other serious global issues is a perfect example of this mode of operation. The team is comprised of elder statesmen (and women) from all over the world like Kofi Annan, Graça Machel, former US president Jimmy Carter, Mary Robinson and Fernando Cardoso, who have come together with the single-minded goal of working together for peace and human rights. In a world of over-inflated corporate egos and boardroom skirmishes it is truly humbling to see these amazing people’s work ethic and dedication to simply getting it done.

This expansive networking of the leadership role means that it is no longer the exclusive domain of just those folks with a ‘C’ in their titles. It always irks me to hear references to things like ‘our leadership team’. Such exclusionary terminology is a big mistake, not only because of its deification of the illustrious chosen few with Cs in their titles, but more importantly the implication that by default everyone else is not a leader! In fact, the only meaningful thing on your business card is your name and your contact information. The title beneath it says nothing about the level of respect you deserve from the person you hand it to – that’s all down to what you say and do, or in some cases
don’t
say and do from that point on. Just as seniority is usually just a measure of tenure and has specific linkage to contribution, unfortunately titles have no true bearing on anyone’s true ability to lead.

The fact is that one way or another and to varying degrees we are all leaders in our own orbits, be it in our families, our communities, among our peer groups or in the office. You can be well below ‘C level’ and still be a valuable leader. The really good news about the spreading of authority through a more collective approach is that it gives a much bigger stage on which a wider set of cast members get a chance to show how well they can perform.

I’m not at all keen on printed corporate organisation structures. You know, the ones that start with the CEO or president sitting in splendid isolation in the little box on the top row and then fans out line by line in a perceived descending order of importance. I actually once heard a senior executive complain that his position on such a chart was an insult as it had his box positioned a fraction of an inch lower than that of someone he considered to be his peer. My rather curt response to this utterly childish comment is not something I’d want to put in print, but suffice it to say I think he got the point. If you really feel such charts are necessary, I much prefer the orbital variety. That’s the type where the CEO sits in a circle in the centre of the page and all of his direct reports are in smaller globes that encircle the CEO – almost as if he or she were the centre of his or her own little solar system. It might sound odd but try it – at least nobody has a beef about their respective levels as they are all in an equidistant orbit from the Sun God in the centre.

In my experience, any culture with an over-emphasis on ‘knowing your position’ creates problems that get in the way of relationships, causes resentment and, as a direct result of this, can interfere with progress and innovation. The demarcation lines that any form of elitism creates can only serve to harden the walls of departmental silos that need to be softened not reinforced. Also, I’ve found that hierarchies based upon strictly observed pecking orders are usually denied the multiple layers of leadership that one finds in healthy results-oriented rather than status-conscious structures. Call it the ‘Don’t ask me, I just work here’ syndrome if you will, but when there is an authoritarian ruler at the top of the heap, almost every layer beneath them is much less likely to make timely decisions based on their own instincts, preferring instead to push everything ‘upstairs’ and thereby reducing the chances of either getting it wrong and/or overstepping their corporate marks.

LUNCH BOXES

To this day some cultures are much more accepting of blind respect (or at least an appearance thereof) for traditional highly tiered pecking orders than others. Japan would be one example of this, and even a few older European companies tend to still have a somewhat ‘Upstairs Downstairs’ attitude to their employee ‘class system’. A few years ago I was invited to lunch in the executive dining room of a long-established London-based company. I was amazed to find that their lordly executive dining room had its own private chefs, more waiters than diners and the food and service were as good as many a top city restaurant – complete with a lengthy wine list. I am sure such things may still exist, even if that particular company is no longer around, but hopefully not for much longer. When the senior management of a company considers itself too precious to share the same food and dining space as the rest of their people, then frankly it would not be a place I’d want to work!

There is a lot of ancient and still valid symbolism involved with breaking bread together. It is something that healthy families will still do, while dysfunctional households seldom sit down to a meal together. In business too there is a lot to be said for encouraging all of your employees to mingle over mealtimes and if you are the head honcho, you too should try and make a point of joining them on a regular basis. When we built our new headquarters building for Virgin Atlantic outside of London – officially named ‘The Office’ long before the TV show of the same name – I think we spent more time designing the centrally located, ground-floor dining hall than we did any other part of the facility. It was time and effort well spent as it fast became the social centre of the building with every level of employee meeting and eating there on a daily basis – and why not? The food is excellent!

GOOD VERSUS ‘EVILUTION’

While a good manager will have the ability to supervise others, keep them within company guidelines, play by the rules and read the maps they’re handed, all this tells you nothing about how comfortable they will be going off-road and breaking new ground. Striking out in new unexplored directions takes a whole different mindset and one that often means breaking, or at least massaging, a few of the old rules. Management is much more about maintaining processes, disciplines and systems than about changing them. Strong leaders, on the other hand, while maintaining stability, must have vision, creativity and, perhaps most importantly, the ability to influence others to follow and support them in the challenges of moving an organisation into uncharted and often highly risky territory.

Good leadership is by definition all about taking the venture forward and finding viable new avenues where the business can evolve and prosper. Poor leadership, on the other hand, typically tends to be static, much more about protecting the status quo and, if there are any around, resting on laurels. This ‘don’t rock the boat’ approach may have been a viable business model twenty years ago, but at the frenetic pace of business today it is no longer an option. To stand still today is to go backwards – and quickly!

While I have found that outstanding leadership tends to come in a huge range of very different and often quite quirky and eccentric packages, poor leadership usually displays a lot of common denominators. There are also a lot of contradictions, however. For instance, how would one rate a leader with the reputation for being ‘Such a great guy – he never gets in anybody’s face and just lets us all get on with our jobs’? Such an individual could either be a highly skilled delegator or just someone who has no stomach for confrontation. While few people – myself included – genuinely enjoy confrontational situations, when they arise, dealing with them in a timely manner is an inescapable and important part of effective leadership. Some leaders are frequently guilty of shying away from anything that might result in an altercation in the mistaken impression that this will make them more likeable to their employees. The reasons for an aversion to facing up to confrontation can be several: either they just don’t have a sufficient level of confidence in their own technical understanding of the problem to be able to stand their ground and win, or frequently they’d simply prefer to turn a blind eye in the hope that by ignoring the issue it will over time somehow manage to sort itself out. Unfortunately, failing to confront a problem while it’s at the smouldering stage will more often than not only lead to its proliferation into a fully fledged fire that is much harder to extinguish and can do a lot of long-term damage.

Another relatively common confrontation avoidance technique with weak leaders is to always have someone else on hand to take care of the dirty work on their behalf. This will typically involve having a senior management ‘hatchet man’ to handle anything where they don’t want to risk dirtying their own hands or damaging their ‘Mr Nice Guy’ reputation. Is this an example of skilful delegation? I think not.

There seems to be a lot of confusion around the subtle but critical differences between ‘delegation’ and its first cousin ‘relegation’. Simply stated, ‘delegation’ is handing on the responsibility for a situation together with the authority to resolve it. Relegation on the other hand is simply pushing a problem away but without including the power to really do anything much about it – except perhaps to shoulder the blame. In short, one of the most common mistakes to be found in poor leaders is an inability to understand the difference between these two ways of working. In the same way that this kind of leader is skilled at relegating blame, they are usually very good at holding their people accountable – everyone, that is, except themselves.

TAKE ME TO YOUR BLEEDER

A classic example of what can go tragically wrong in the absence of smart forward-thinking leadership has to be what happened to Kodak. For over a century Kodak was virtually synonymous with photography all around the world. They invented the automatic camera over a hundred years ago, and ‘A Kodak Moment’ (a photo opportunity) became part of the English language. When I was about twelve years old, I remember my excitement one Christmas at getting my very first camera. It was
the
coolest camera of the day, a Kodak Brownie Box Camera, and I was beside myself with delight.

But times change and while Kodak should have been in the driver’s seat when digital photography first emerged – in 1975 they had developed a digital camera that was the first of its kind – the product was soon dropped for fear it would threaten their existing photographic film business. Instead of embracing the opportunities that the new technology presented and exploiting their resources to lead the charge, Kodak’s senior management instead seemed to bury their heads in the sand. It was almost as if they believed that if, as the industry leader, they were to ignore it then digital might magically go away – but like King Canute who thought he could turn back the tide, they were very much mistaken.

Eventually, seeing the error of their ways, Kodak condescended to try and create contrived synergies such as ‘Photo CD’ that fell somewhere between their traditional analogue offerings and digital technology, but compromises seldom work. While Kodak tried desperately to hang on to the past and the huge 70 per cent profit margins they had enjoyed from their traditional film business, newcomers to the camera game like Sony swept right on by them and, as they say in the US, ‘ate their lunch’. Kodak’s share price dropped by 80 per cent in 2011 and they filed for Chapter 11 bankruptcy protection in January of 2012. It took until September 2013 for Kodak to emerge from bankruptcy protection as a greatly pared-down and I suspect, much wiser company. The fact that other major analogue-era imaging companies like Canon, Nikon and Leica all successfully navigated the transition to digital would seem to indicate that the only plausible reason for Kodak’s rapid decline was a catastrophic failure in leadership. And as is almost always the case, leaders who spend too much time looking in the rear-view mirror are seldom positioned to navigate the road ahead.

My interest in the Kodak story stems from my own experiences with the winding down of our once-booming pre-digital Virgin Megastore business. Like Kodak, I too was guilty of a very similar reluctance to accept the havoc that digital technology was about to wreak upon one of our core businesses. Virgin Megastores (our music retailing business) was very near and dear to me, I suspect in much the same way as the film business was to Kodak. Virgin had been in the record retailing business since opening our first little shop in London in 1971 – in fact, back then it was our only business! By the early nineties that one shop had expanded to scores of gigantic Virgin Megastores all over the world.