Every company comprises numerous interlocking fiefdoms and bureaucracies. People are territorial creatures so this is all quite natural. But it can be dangerous to an organisation’s health when, for instance, employee resistance effectively stifles chief executive’s initiative.
How CEO overcomes institutional inertia is measure of his or her worth. The memo, the meeting, the team: each has its place in leader’s repertoire of managerial moves.
One tactic – frequently frowned upon by management pundits – is the CEO end run, in which he starts project, and allows it to develop without the input or knowledge of other executives.
“Bad management!” scream the petty bureaucrats of business, and sometimes they’re right. Sometimes, however, CEOs find themselves stalemated and short on options. The resistance can be deliberate, spawned by culture of learned helplessness. Or it can be product of too many layers of approval and too many focus groups. In these cases, an end run may be the only way to make anything happen. There’s only one rule: it must work, or it diminishes CEO’s authority.
An offer they can’t refuse
My most memorable involvement in an end run was with John DeLorean when he was general manager of Pontiac. I had just met DeLorean at friend’s house in Los Angeles. At the time he was commercial whiz kid so I asked: “How’d you like to own sport?”
“That sounds interesting,” he said. “Go on.” We were, at the time, trying to help the US Ski Team, an organisation and sport that were about as invisible as sport could get. US skiers weren’t doing well and companies weren’t doing anything commercially with them. And yet, as I pointed out to DeLorean, skiing was unquestionably “in” with the upper crust and the jet set. It was associated with people of wealth. “Let me get Pontiac into skiing promotion or two,” I said, “nothing expensive or complicated. If it works out, we can sign on for more extensive contract,” for escalating percentages, of course.
DeLorean liked the pitch, especially the analogy between the speed and balance of skiing and the performance of Pontiac cars. “That’s the kind of image I want for us,” he said, and made decision there and then to go ahead.
I was elated, but then DeLorean said something that gave me pause: “Don’t mess around talking to any of my people,” he said. “You’ll hear from my agency.” From then on Pontiac’s marketing department and ad agencies were kept in the dark. I’m sure he had his reasons, including the fact that nobody wanted any part of the US Ski Team. But it was also DeLorean enjoying making them sweat bit. He obviously wanted to make point as well as produce promotion, and continued to meet privately with me.
Beware the stealth assassins
The time came, however, when Pontiac’s ad agency had to be told. They were flabbergasted. It turned out DeLorean had never met them before he announced that he was personally going to drive this idea through.
So meeting was arranged with the agency, MacManus, John & Adams, at which DeLorean was the only Pontiac executive present. Not even his marketing manager was invited. At 9am DeLorean showed up, along with the US coach, Bob Beattie, and five executives from MacManus. The agency’s chairman wasn’t there. “He’ll be here in five minutes,” said an executive. DeLorean didn’t even look up. “We’ll start now,” he replied.
The agency delivered an in-depth presentation, with research and plenty of informed opinion, all of it weighted against any involvement with the Ski Team. We took our turn, and described our concept – how the Pontiac logo and name would be displayed on team bibs and team members would deliver customer entertainment. DeLorean said yes, and that was that. The first promotion worked, and the resulting association proved to be very good for Pontiac.
It was classic CEO end run. What made it work was CEO ready to carry the banner, all the way through the organisation. And that’s what leaders need to do to make an end run success. Had DeLorean handed the deal to his agencies and executives, I’m sure nothing further would have come of it.
Mark McCormack is the founder of International Management Group. www.successsecrets.com
