Monthly Archives: February 2017

CNBC: CEOs Shouldn’t Be Afraid to Stand Up to Trump

President Donald Trump‘s actions are sending shock waves through the business community, but will CEOs have the courage to challenge him?

Publicly, most CEOs are declaring how pleased they are with the President’s attention, which has been greater in the past three months from President Trump than it was in eight years under President Obama. Trump is promising them lower corporate taxes, fewer regulations on financial services, health care and energy, and improved infrastructure, while acknowledging business as the driver of economic growth. Every week the President is meeting with CEOs from major industries. Last week it was retailers; before that, airlines and automobiles.

Beneath these rosy promises, Trump’s policies are setting off alarm bells in C-suites. Even before his inauguration, he shook business leaders with a series of tweets attacking such great American stalwarts as Ford, General Motors, Boeing, Lockheed Martin, and United Technologies, criticizing their global manufacturing plans, while threatening them with large tariffs for imported products.

Ford and United Technologies’ Carrier division immediately offered compromises to avoid Trump’s wrath. Concerned their companies might be the next recipient of a Trump tweet, the CEOs of Amazon, Fiat/Chrysler, and Sprint rushed to Trump Tower with offers to employ more Americans. In reality, they were just re-announcing previously published expansion plans. CEO Brian Krzanich told the President that Intel was restarting a $7 billion facility in Arizona, which was originally launched in 2011 under President Obama, and then postponed in 2014 due to lack of demand.

In a recent interview with Harvard Business Review, former U.S. treasury secretary Larry Summers called on business leaders to stand up to the Trump administration, asking, “If CEOs who employ hundreds of thousands of people are not in a position to speak truth to power, who is going to do so?” Rather than trying to curry favor with President Trump, business leaders need to advocate for their long-term needs, and challenge him when his actions will harm their long-term futures.

Since his January 20th inauguration, President Trump has signed more than 20 executive actions on issues including jobs, trade, immigration, national security, health care, and financial regulations. Most controversial to date was the 120-day travel ban, a move the State of Washington challenged as unconstitutional. The Washington court temporarily lifted the ban, which the Trump administration challenged in the Court of Appeals.

This represented a seminal challenge to technology companies that rely heavily on immigrants. With more than 5.5 million jobs going unfilled for lack of qualified applicants, they cannot afford to hire only American-born citizens. Thus, 97 technology companies including AppleGoogleFacebook, Microsoft, eBay, and Intel, stepped up by taking the unprecedented step of filing a joint amicus brief challenging the order, claiming it “threatens companies’ ability to attract talent, business, and investment to the United States.” They were joined by Coca-Cola, General Electric, Goldman Sachs, JPMorgan, Starbucks – more than 140 companies in all – marking the first time CEOs had actively challenged Trump. On February 8, the President had his most significant defeat when the Court of Appeals refused to reinstate the travel ban.

In addition to the travel ban, Trump’s actions are shaking up leaders in other sectors. His proposed border adjustment tax on imports would adversely impact major apparel and electronics retailers like Walmart, Target, Best Buy, Nike, and Under Armour that rely on overseas production. A 20 percent border tax would lead to a 20 percent price increase for consumers, creating more strain on their wallets and threatening the jobs of 15 million retail employees. Trump’s egregious tweet against Nordstrom accused the company of treating his daughter Ivanka unfairly for discontinuing her branded products.

Nordstrom defended its decision, citing declining sales of Ivanka’s products.

Under Armour CEO Kevin Plank tried to curry Trump’s favor, calling him “a great asset to America.” He was forced to recant when Steph Curry, his firm’s top sponsored athlete, responded he would agree if Plank removed the letters “et” from his praise. Plank acknowledged the border tax would hurt his firm’s sales since “there are no apparel makers or textile companies left in America.”

Trump’s numerous executive orders are easy to issue but often vague or unclear about details, making their implementation complex and confusing. As Trump tries to repeal Obamacare, he is learning how hard it is to design a reasonable replacement. The same is true for reducing financial regulations by gutting the 2010 Dodd-Frank bill, since no one wants to risk a 2008-style collapse.

Given the chaos in Washington, how should business executives lead in the Trump era? Will they have the courage to step up to these new challenges? My advice is to stay focused on their business, while not letting the president’s machinations throw them off course and speaking out whenever required.

Here are five recommendations for business leaders:

  1. Focus on True North. Stay focused on realizing your mission despite the uncertainty. Do not deviate from the core principles that define your company for fear of retaliation from the Trump administration. Staying on track will deepen the loyalty of customers and employees – the people who matter most.
  2. Build on your strengths. Develop a clear vision of how your company will win by strengthening unique differentiators setting you apart from competitors, and leveraging these strengths to gain competitive advantage.
  3. Adapt your tactics, not your strategy. Continue with strategies established before Trump took office, but rapidly adapt tactics to this era of extreme volatility. Encourage employees to stay agile and think creatively about different ways of achieving their goals, despite roadblocks they face. You may be forced to make tactical adjustments, but pursue your strategy with laser-like focus.
  4. Don’t abandon globalization. Globalization is a reality that will continue despite the administration’s recent efforts to halt it. An “America First” mentality limits your growth potential, so continue to build your global business without backing away from expanding overseas. Embrace globalization by targeting new foreign markets, hiring diverse employees, and building overseas operations. At Medtronic we hired three Americans for every job created overseas as the company expanded from 4,000 employees in 1989 to 85,000 today.
  5. Prepare for the jobs of the future. Speak out publicly to encourage Trump to address the real jobs issue: the skills gap created by the lack of lifelong training and education. Prepare your workforce for jobs of the future instead of protecting antiquated jobs as Carrier agreed to do. Take a cue from Amazon, General Electric, and SAS, whose programs enable employees to develop skills required for tomorrow’s world.

Business leaders have a responsibility to step up to the challenges presented by Trump’s administration and lend their voices to shape a better country. By building their businesses for the long-term, they will strengthen the economy and the nation.

Commentary by Bill George, a senior fellow at Harvard Business, former Chairman & CEO of Medtronic, and the author of “Discover Your True North.” Follow him on Twitter @Bill_George.

This content was originally posted on on 2/24/17.

A Strategy For Steady Leadership in an Unsteady World

Management is tough enough in normal times. But what are leaders to do when their companies are buffetted by global uncertainty? Bill Georgeexplains charting a course True North.

With the events of 2016—Brexit, the election of Donald Trump, threats from terrorists and cybercriminals, climate change—business leaders have entered a new era requiring new ways of leading. Traditional management methods seem no longer sufficient to address the volume of change we are seeing. I label this VUCA 2.0.

In a 1998 report designed to train officers for the twenty-first century, the United States War College presaged a world that is “volatile, uncertain, complex, and ambiguous” —VUCA, for short. VUCA describes perfectly what is happening in the global business world today.

Business is not running as usual. Leaders must deal with growing uncertainty, complexity, and ambiguity in their decision-making environments. CEOs have little idea what to expect in terms of health care policy, financial transactions, national security, and global trade—all of vital importance to themselves, their employees, and their stakeholders.

Managerial training in the classic techniques of control systems, financial forecasting, strategic planning, and statistical decision making have not prepared them for this amount of flux in the environment.

In short, these rapid-fire changes are putting extreme pressure on business leaders to lead in ways not heretofore seen.

The VUCA manager

Now is the time for authentic business leaders to step forward and lead in ways that business schools don’t teach. Let’s examine these different ways of leading comprising VUCA 2.0:

Vision – Today’s business leaders need the ability to see through the chaos to have a clear vision for their organizations. They must define the True North of their organization: its mission, values, and strategy. They should create clarity around this True North and refuse to let external events pull them off course or cause them to neglect or abandon their mission, which must be their guiding light. CEO Paul Polman has done this especially well by focusing Unilever’s True North on sustainability.

Understanding – With their vision in hand, leaders need in-depth understanding of their organization’s capabilities and strategies to take advantage of rapidly changing circumstances by playing to their strengths while minimizing their weaknesses. Listening only to information sources and opinions that reinforce their own views carries great risk of missing alternate points of view. Instead, leaders need to tap into myriad sources covering the full spectrum of viewpoints by engaging directly with their customers and employees to ensure they are attuned to changes in their markets. Spending time in the marketplace, retail stores, factories, innovation centers, and research labs, or just wandering around offices talking to people is essential.

Courage – Now more than ever, leaders need the courage to step up to these challenges and make audacious decisions that embody risks and often go against the grain. They cannot afford to keep their heads down, using traditional management techniques while avoiding criticism and risk-taking. In fact, their greatest risk lies in not having the courage to make bold moves. This era belongs to the bold, not the meek and timid.

Adaptability – If ever there were a need for leaders to be flexible in adapting to this rapidly changing environment, this is it. Long-range plans are often obsolete by the time they are approved. Instead, flexible tactics are required for rapid adaptation to changing external circumstances, without altering strategic course. This is not a time for continuing the financial engineering so prevalent in the past decade. Rather, leaders need multiple contingency plans while preserving strong balance sheets to cope with unforeseen events.

With external volatility the prevalent characteristic these days, business leaders who stay focused on their mission and values and have the courage to deploy bold strategies building on their strengths will be the winners. Those who abandon core values or lock themselves into fixed positions and fail to adapt will wind up the losers.

Bill George is senior fellow at Harvard Business School, former chair and CEO of Medtronic, and author of Discover Your True North.

This content was originally posted on on 2/14/17. 

CNBC: Japanese PM Abe Key Partner for US

Watch Bill Discuss Pres. Trump’s meeting with Pres. Abe of Japan and the court ruling on the travel ban.

This content was originally posted on on 2/10/17.