The secrets to surviving – and thriving – as a CEO
Toshiba's accounting scandal drew attention to Japan’s long-serving leadership culture.
This prompted us to ask: Who are the world’s longest-serving leaders, and what can we learn from their longevity?
With research showing that the average tenure of a FTSE 100 firm CEO is just five years, it reflects the pressure on industry leaders to make a transformational change of their businesses in a short period of time. Contrast this to former Nintendo chief executive Hiroshi Yamauchi, who was at the helm for a staggering 53 years.
Insights looks at Leslie Wexner, Warren Buffett and Martin Sorrell, three of the world’s longest serving bosses, to see what fellow and future chief executives can learn, and ensure their leadership lasts decades rather than years.
Owning the culturally impactful Victoria’s Secret, Wexner holds the mantle as the longest-serving chief executive in the US. Starting his business while John F. Kennedy was still president, the Ohio-native has led L Brands for 52 years, overseeing its growth into one of the world’s largest lifestyle and fashion retailers. Worth $7.6bn (£4.87bn) according to Forbes, L Brands includes Victoria’s Secret and Bath & Body Works within its portfolio, and the corporation registered an earnings rise of 15% last year.
What can bosses learn from Wexner
The power of reinvention: Wexner prides himself on never being complacent and continues to rebrand the company to fit new expectations. Through a string of acquisitions, L Brands has transformed companies, each time taking on new retail brands that point to new target. Examples include Abercrombie & Fitch, which it floated in 1996, and Lerner New York, now known as New York and Company. And this is also reflected in its name: initially called Limited Brands, Wexner changed it to The Limited in the mid-2000s, with the firm now known as L Brands.
Not far behind Wexner, billionaire investor and mentor Warren Buffett has remained at the helm of his company Berkshire Hathaway for almost 50 years. Over recent years, his visibility on social media has made him a recognised business figure to those outside of the City and Wall Street. Nicknamed the Oracle of Omaha, the 84-year-old seems as sprightly as ever, balancing his regular media appearances with overseeing his portfolio of companies worth more than £65bn. Only last month, Buffett was a key figure in prompting the large blue chip food manufacturing merger of Heinz's merger with Kraft Foods Group, doubling Berkshire Hathaway’s stake value to about £16.7bn.
What can CEOs learn from Buffett?
The profits are in the details: In The Essays Of Warren Buffett, the Ohioan advises business leaders to treat deals and acquisition with the same thoroughness as one would in looking for a spouse. Buffett says: “In the search [of a deal], we adopt the same attitude one might find appropriate in looking for a spouse: It pays to be active, interested, and open-minded, but it does not pay to be in a hurry.” And for Buffett this attention to detail in research has consistently proved profitable.
In 1988, for example, Buffett’s analysis of decades of Coca-Cola’s business performance records, in addition to the drinks maker’s planned investment in its outperforming syrup business and overseas markets, led to a $1bn buyout of the corporation’s stock. Going against the advice of Wall Street, Buffett was proved to be right as Coco-Cola’s stock value has more than quadrupled since.
Having left his role as financial director at advertising giant Saatchi & Saatchi in the summer of 1986, Martin Sorrell bought ownership of wire basket manufacturer WPP in the year and turned it into one of the world’s largest communication corporations. Some 29 years later, Sorrell remains chief executive, raking in a reported £43m salary last year, and the company encompasses hundreds of leading marketing, public relations and media agencies, including the Grey Group, Ogilvy & Mather, Young & Rubicam Brands and JWT.
What can CEOs learn from Sorrell?
Aggressive acquisition-led growth: He was prescient in identifying changes impacting the industry – whether it be consolidation, emerging markets or new technologies – and reacted quickly by buying companies. Unafraid to ruffle fears, Sorrell famously led the shock hostile takeover of Ogilvy in 1989, attracting a number of derisory comments from its founder in the process. However, it was a watershed moment for WPP as it showed their growing power, which was only emphasised as Sorrell restructured the famous brand in the succeeding years to make it a driver in advertising during the information age.