U.S. Senator John McCain’s 2005 book, Character is Destiny, was not only a testimony to lives of leaders well-lived, but also a clarion call for how to live life overall.
“It is your character, and your character alone, that will make your life happy or unhappy. That is all that really passes for destiny. And you choose it. No one else can give it to you or deny it to you. No rival can steal it from you. And no friend can give it to you. Others can encourage you to make the right choices or discourage you. But you choose.”
—John McCain, United States Senator
In business, this is time of the year when the editors of Fortune look ahead to the new year and announce the World’s Most Admired Companies (WMAC). For more than 30 years, the WMAC has been an in-depth annual ranking process in collaboration with Korn Ferry, the global talent company, of the Fortune 1000 and Global 500 companies, in 56 sectors. I had the opportunity to guide a Fortune 200 company through the process for five years, each year advancing up the ranking scale. It was never one person’s achievement, but as it should be, one that was the annual culmination of a total enterprise, team effort.
While not for every company, the WMAC assessment process is an informative rubric, because reputation is tangible (“fungible”). As much as 30 percent of a company’s Wall Street value is goodwill and reputation.
While there are changes from year to year, the perennial Top 10 WMAC have typically been:
- Apple
- Amazon.com
- Alphabet
- Berkshire Hathaway
- Starbucks
- Walt Disney
- Microsoft
- Southwest Airlines
- FedEx
- JPMorgan Chase
How are companies evaluated?
There are nine attributes used by WMAC to rank leaders in their industries. Despite the size of an organization, or whether it is commercial, non-profit, or public sector, the attributes can assist organizational leaders in devising strategies, and tactics, to secure their organization’s sustainability, and sustainable competitive advantage.
Let’s look at the them:
- Ability to attract and retain talented people
- Quality of management
- Social responsibility to the community and the environment
- Innovativeness
- Quality of products or services
- Wise use of corporate assets
- Financial soundness
- Long-term investment value
- Effectiveness in doing business globally
In show business, there is the saying: “There are no small parts, only small actors.” And so it is in business. There are businesses that think they are small. In that case, they will have a self-fulfilling prophecy of staying “small.” There are small businesses that think big, and they are the leaders of tomorrow.
The attributes are scalable. They are particularly important in a hyper-competitive environment for both customers, as well as the talented employees who ensure customers stay loyal. Taken together, they underscore that reputation is a team sport. It’s not the public relations department. It’s not the communications department. It’s not the community relations department. It’s not the human resources department. It’s not the marketing department. It’s everyone’s department. It’s everyone’s responsibility.
But most of all, the attributes can inform and guide the character of an organization, and the people who are its heart beat. Like beauty, character starts… and stops… from within. And for it to be true, character, values and norms must start at the top. They must be walked, not just talked.
Character is particularly critical at a time of crisis. We only have to reflect on the gas line explosion crisis north of Boston last September to underscore the fact that bad things will happen. What matters is what do you do to be prepared.
Guided by virtue ethics, rooted in Greek philosophy, leaders and their organization will do the right things, at the right time, in the right way. This is all the more important in the minutes after an incident—-the “Golden Hour”—when actions can make the difference between an incident elevating to a full crisis. To paraphrase Warren Buffet, it can take years to build a reputation, only to have it lost in minutes—or even seconds.
