LEADING CHANGE INSIDE FUJITSU

The health care quandary BEVERLY GOLDBERG – p18

Leadership saves lives PETER LEES – p26
Helping hospitals to improve health care Kamalini Ramdas – p32

Business
LEADING CHANGE

INSIDE
FUJITSU
Fujitsu is big in Japan, but less
known elsewhere. Stuart Crainer
and Des Dearlove were given
unique access to the Japanese
technology giant to learn more
about its plans for change.
In a meeting room on the 32nd floor of
Fujitsu HQ in central Tokyo, a group
of managers is trying to describe the
company. “It isn’t a smart and sexy
sort of place,” says one. “We are quiet.
Quiet and confident,” adds another.
“We never give up,” ventures a third.
“Our DNA is based on giving it a try,
just doing it. At the same time we are
solid. Craftsmanship is at the core of
our manufacturing. Trustworthiness
is also very important because we
work very closely with customers.” Fujitsu Tokyo
The discussion moves from
English to Japanese. There is,
we are told, a word in Japanese, and distinguished track record as
which describes Fujitsu perfectly a technology pioneer. In 1954, “It isn’t a smart and
— ‘dorokusai’ — but no one is Fujitsu developed the first Japanese
computer, and in 1976 it created
sexy sort of place,”
sure of the best translation. It has
something to do with being pragmatic the first Japanese supercomputer. says one. “We are
and reliable, and getting on with Fujitsu engineers made it possible
to process Japanese kanji characters,
quiet. Quiet and
the job without a making fuss.
After more discussion, we creating the first computer with confident.”
agree that the closest English Japanese language capability in
equivalent is down-to-earth. 1979; and in 1992 the company
Fujitsu is down-to-earth. introduced the world’s first 21 inch
This is an odd description for a full-colour display, followed in 1995
high-tech company with Fujitsu’s by the first 42 inch plasma screen. systems for train drivers to mobile
pedigree: it is the third biggest player Today, it leads the Japanese domestic phones. It is also closely involved
in the global IT services market, laptop market and is involved in a in a variety of scientific projects
with sales of 4.6 trillion yen (US$50 range of technologies from cloud in Japan and around the world,
billion) and 172,000 employees computing to the next generation and in expanding the role of IT in
in 60 countries. It also has a long of supercomputers, from simulation agriculture, healthcare and education.

ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 07

BUSINESS
And yet, Fujitsu remains grounded
— down-to-earth; ‘dorokusai’. In
markets where it is long established —
such as Europe and the United States
— it retains a stubbornly low profile.
In others, including China and India,
it is barely known at all. For 75 years,
Fujitsu has quietly gone about its
business — a quiet giant. Now, under
the leadership of its new president,
Masami Yamamoto, the Japanese
information and communication
technology company is set on change.
Change, of course, is not unusual
in the corporate world. But this is
change with a difference. Led by
the steely-eyed Yamamoto, Fujitsu
is attempting to shape not just its
own future but that of its customers
— and, perhaps, society, too.
Facts of corporate life
Driving the change is the same down-
to-earth pragmatism that is written
into Fujitsu’s DNA. “If you look at
the life cycle of companies they have
a period of rapid growth, a period of
stability and then they start declining.
Each of these periods lasts 20 years,”
says Yamamoto, a 34-year Fujitsu
veteran. “We are now 75 years old
so the message is clear: we need to
reinvent and reshape ourselves. The
challenge for Fujitsu is to move onto
the next growth stage. The danger is
that if we don’t we will start to decline.”
Yamamoto’s C-suite colleagues are
08 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010
Photo: Emma Cross
01 02
“We need to change
things if we are
to become a $100
billion company.”
01 Masahiko Yamada, President of
Technical Computing Solutions
Unit: Customers rule
02 Fujitsu Workplace Receives 6
Star Green Star Certified Rating
03 A receptionist awaits visitors at
Fujitsu's showroom in Tokyo
04 Chiseki Sagawa: Philosophy
meets technology
05 Hideyuki Saso: Intelligent
traffic lights
similarly frank. “We need to change
things if we are to become a $100
billion company,” says corporate
senior executive vice president (EVP)
Hideyuki Saso matter-of-factly. “For 04
example, there are a lot of processes in
our product development and there is
the danger that, as time passes, people
focus on the processes. It is like when
people won’t cross the road until the
light turns green even if there are no
cars approaching. What we need in the
organisation are intelligent traffic lights.
We have to continually revisit what
we do and figure out the best way.”
Corporate senior executive vice
president and director, Kazuo Ishida,
warns: “If we want to globalise,
05

03
we must change. If we are to bring
in truly global standards and our
knowledge and experience from
throughout the world, there is not
much time. This could be the last
chance for Fujitsu to change.”
Fujitsu’s Yamamoto and his senior
management team are not the first
to appreciate and lament the short-
lived nature of corporate success.
In his book Living Company, the
former Shell executive Arie de Geus
pointed out that only a handful of
companies last beyond a century.
Reminders of corporate mortality
are easily found. Look at Jim Collins
and Jerry Porras’ business bestseller,
Built to Last, and you will quickly
discover that many of the companies
have struggled since being held
up as benchmarks of longevity.
Equally, examples of companies
that have reinvented themselves
are few and far between. Think of
Nokia’s move from being a timber
company to mobile phone giant.
Famously, too, IBM transformed
itself from a computer hardware
company to a business solutions
firm under Lou Gerstner.
Fujitsu is setting out on its own
journey. Yet, in conversations with
Fujitsu’s executives, it is clear that
IBM looms large in its world view.
Historically, IBM was the giant and
Fujitsu the pesky upstart. The rivalry
goes back a long way and has provided
LEADING CHANGE INSIDE FUJITSU
Making
History
a focus for the company and its
1935
managers for decades. Beating IBM
is a common refrain when Fujitsu
executives recount why they joined Fuji Tsushinki Manufacturing
the company in the first place. Corporation (currently Fujitsu
IBM is still Fujitsu’s largest Limited) established as an
offshoot of Fuji Electric’s
competitor. But, under Yamamoto, Communications Division
Fujitsu is intent on moving out (capitalised at 3 million yen
of Big Blue’s shadow. “In our with 700 employees).
minds we still tend to see IBM as
the big competitor, but there are
others — like HP,” he observes. 1940
It is also clear that the journey that Delivers Japan’s first
Fujitsu is embarking on is a different domestically produced
“T-type” automatic switching
kind of transformation. Big Blue was system to Japanese Ministry
going broke and faced extinction of Communications and
unless it changed. Fujitsu faces no Transportation.
such crisis. Indeed, its 2009 operating
income was just over $1 billion with
more than $3 billion available in cash.
1954
And yet the urge to change is strong.
Higher ambitions
Unveils Japan’s first relay
Avoiding decline is an understandable type, electronic computer,
goal, of course, but Fujitsu’s the FACOM 100.
ambition goes beyond simply
ensuring its own survival.
The company has declared its
1964
Delivers Japan’s first data
intent to use technology to contribute communications system, FACOM
to society. At the heart of its vision is 323, to Nikko Securities Co., Ltd.
the notion that computing should be
configured around human beings and
not the other way round. So while 1980
rival IBM trumpets its Smarter Planet Becomes largest computer
concept, Fujitsu talks about using company in Japan.
Introduces Japanese word
technology to enrich people’s lives. processor, OASYS 100.
“This will involve collecting
data on the behavioural patterns of
people and organisations that mobile 1995
phones and other ubiquitous products
generate, and taking advantage of
cloud computing, supercomputers,
and other technology infrastructure to Commercialises world’s first
analyse the data,” explains Yamamoto. 42-inch colour plasma display.
“This data has the potential to
revolutionise all aspects of human life
— from healthcare to transportation,
2005
and education to agriculture.”
Fujitsu predicts a big shift in the
role of technology in business and in Launches globally
society. While other IT providers tout PalmSecure contactless
a world view that sees an increased palm vein authentication
role for computing solutions to equipment business.
existing problems, Fujitsu emphasises
how quality of life can be enhanced 2008
by technology. In this view of the Sales of “universal designed”
future, technology is more than just an mobile phones surpass the
enabler; it is a journey, a dialogue with 12 million unit mark.
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 09
BUSINESS

society that allows people to shape

their own future. It is the shaping
element that distinguishes the Fujitsu
point of view from its competitors.
For Fujitsu there are three pillars
to this strategy. First, you have to
get close enough to customers and
end-users to see the world through
their eyes. Second, you have to have
a truly global perspective and reach,
to offer local solutions anywhere in
the world (a variation on the “think
global, act local” dictum). And
third, you have to be committed
to a sustainable future. The third
prong, in turn, has two elements: the
greening of IT products; but also the
opportunities to use new technology
to tackle environmental issues — for
example, using a supercomputer
simulation to model global warming.
Underpinning all of it is the idea
that technology has an essential role
to play in the evolution of civilization.
Says corporate senior EVP and
director, Masami Fujita: “People
used to see us as a mobile phone
or PC company. Now, they see
that we are contributing to society
— we are shaping tomorrow, as
our branding puts it — and that is
very attractive to young people.”
Such higher aspirations are made
real when you meet Aiichirou Inoue,
president of the Next Generation
Technical Computing Unit. Inoue
worked three years at another
company and then joined Fujitsu
where he was a driving force behind
the company’s mainframe computer 01 Fujitsu’s flexible electronic paper “I want the young engineers
business for 27 years. Given his long features an image memory
working on this project to be excited
service, Inoue could be forgiven for function. This enables continuous
display of the same image even and to enjoy their work,” says Inoue.
possessing an air of ennui. In reality, when electricity is turned off “But, let’s be clear: the K Computer
he is a ball of creative energy, excited 02 The OASYS 100: Fujitsu’s
first Japanese-language will make the future for Fujitsu,
and under pressure in equal measure.
word processor Japan and for human beings. It will
“In my previous roles, I couldn’t do 03 View from Fujitsu HQ give us the ability to look at the
the things I wanted to do. I wanted to 04 The Fujitsu Group Malaysia
Eco-Forest Park in Sabah State weather of the future and there are
build something by myself, not just to 05 Hands off: The world's a huge number of healthcare uses.
use it, but to build it,” he explains. first contactless personal
identification method That’s what I mean about its power
Now, his creativity and passionate
to change humanity. A computer is
leadership are about to bring a change
just a big box; what’s interesting is
in the world of the supercomputer.
Inoue is charged with developing to see it as a tool to help mankind
Fujitsu’s new supercomputer, and societies around the world.”
collaborating with Japan’s Institute
of Physical and Chemical Research, On the offensive
known as Riken. It is nicknamed the K While the bold ambitions of the
Computer by Riken. K is a play on the K computer are alluring, any sort
Japanese word “kei” for the number 10 of organisational change is hard.
to the power of 16. It is a big number The older you get, the harder it
and a big build with a $1 billion total becomes for companies as well as
development budget and Fujitsu’s people. Sprightly septuagenarians
development group numbering are rare — though less so in Japan.
some 1,000 people. Development So how do you convince a 75-year-
of the K Computer began in 2007 old company that it needs to change
and is scheduled to finish in 2012. and then convert it into reality?

10 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010


01 03
The answer from Fujitsu is that,
first, you change the tone. Masami
Yamamoto took over as president
in April 2010 after the controversial
— and, for Japan, highly unusual
— departure of his predecessor.
Yamamoto, the youngest president
of the company for 30 years, brings
a more modern style of leadership
and a new perspective to Fujitsu’s
business. He talks about going on
the offensive and observes that the
company has tended to be defensive.
It is a point backed by other senior
leaders at the company. “We’re being
more proactive with customers,” says
corporate senior EVP Kenji Ikegai.
We asked Ikegai about his future
hopes for the company. “I want the
company to be a global IT player in
products and services. If we don’t
change, our business will shrink.”
Such frankness is unusual among
senior leaders in any corporation.
And it is a constant refrain as we
talk to Fujitsu’s leadership team.
05
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 11
LEADING CHANGE INSIDE FUJITSU
“We’re being more
proactive with
customers. If we
don’t change our
business will shrink.”
02
Chiseki Sagawa, 29 years with the
company, is the president of Fujitsu’s
platform strategic planning unit. “We
need to have more confidence to go
to the next stage. Everyone inside
Fujitsu knows we need to change.
We need to move from optimising
industrialisation to optimising how
people live, it is a mix of philosophy
and technology,” he says.
Reconnecting with its DNA
If changing the tone is the first
element, the second in kick-starting
change at Fujitsu was to gather
the ammunition to back the need
for change. Engineers — and
04
that is primarily what Fujitsu’s
people are — respond to data.
Research by Fujitsu’s corporate
brand office found that understanding
of what the company did and stood
for was often very limited in the
global marketplace. Only a small
percentage in some key markets
outside of Japan identified Fujitsu
as an IT company. This was
exacerbated by a lack of coherence
between its various global operations.
It looked muddled and confused, an
assemblage of companies, ventures,
cultures, products and brands.
To better understand its employees,
as well as its customers, Fujitsu
surveyed 85,000 of its employees
in Japan. It also surveyed customers
and employees outside of Japan.
The research identified three key
characteristics of its brand: responsive,
ambitious and genuine. Says Masahiro
Terauchi, general manager of the
Fujitsu corporate brand office: “The
brand promise is what we want to
be known for; the brand attributes
BUSINESS
The art of Fujitsu
management
Dreams
and detail
“For me the excitement lies in
turning technology into profitable
technology,” says Kazuo Ishida.
“Along the way we make
mistakes. Over my time with the
company I have run 28 projects
with teams ranging from 50 to
800. Some were a year long. At
the end you hand over and move
on to another project. But, I was
never happy with how things had
gone. I always looked back and
identified where, when and how
it could have been done better.”
Fujitsu is a technology company
built on engineering expertise. Its
senior executives typically started
their careers as engineers. An
appetite for detail is part of their
training. Fujitsu engineers prefer
doing to theorising and have an
elevated view of the likely impact
of innovations on broader society:
they see engineering as a route to
improving the world. Dreams and
detail are in unusually
close alignment.
Customer
first
The fashionable business
ideas of our time suggest that
customers are unreliable guides.
Simply, they do not know what
the technology is capable of,
so how can they tell you what
they want or would like? As a
result, the emphasis of recent
years has been on retaining
talented individuals rather than
attracting and retaining high
spending customers. Fujitsu is
old-fashioned in its adherence
to the edict that customers come
first. All Fujitsu executives talked
about the vital importance of
staying close to customers.
Thirty-six years with the company
and now a corporate senior
executive vice president and
director, Kazuo Ishida told us of
his first day working as a systems
engineer. “I went to work with a
banking client. It felt as though
I had become a banker, such was
the identification we had with the
customer. That stuck with me
and I still spend half of my
time with customers.”
12 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010
Grow with
customers
Says Richard Christou: “You
don’t shape the future by simply
selling technology. There has
to be a dynamic, proactive
interchange with customers.”
Customers are not static. Fujitsu
regards them as a growth
opportunity. But this does not
mean trying to screw more sales
out of each account. The win-win
hope is that as customers grow,
Fujitsu will grow alongside them.
“We have a track record
of working with Japanese
companies and there is an
opportunity to grow with them —
and our other customers — as
they globalise. As companies
expand they need to use systems
which are consistent, which they
are familiar with, and which can
receive high levels of support
worldwide,” says Kenji Ikegai.
Masahiko Yamada, president
of the company’s Technical
Computing Solutions Unit, is an
engaging Fujitsu veteran. “At one
stage, I remember thinking that
we need to really focus on costs
and technology. I was wrong:
relationships with customers are
more important,” says Yamada.
Many companies focus on
contracts, Fujitsu emphasises
genuine relationships and
growing with customers.
Multicultural
and global
“If you think about where future
market expansion will occur,
you can only conclude that our
future growth will depend on how
successful we are in developing
our global business,” says
company president
Masami Yamamoto.
His thoughts are echoed with
even greater emphasis by
Richard Christou: “I think we
have a two-year window to
become more global in outlook.
We have to move decisively.
If we do not become more
global, we will shrink.”
The initial ethos of globalising
companies was to try to export
the same products, services and
culture worldwide. This was the
does things differently. As it
deploys the concept, Fujitsu
largely American multinational works seamlessly alongside
model of the 1960s and 1970s. its customers to create value
Then, in the 1980s and 1990s, for them by defining and
the cry was for globalising visualising management
companies to be global and local, challenges with customers.
to combine global strength with
At the same time, Fujitsu
local sensitivities — witness has always recognised the
McDonald’s offering localised
importance of being at
menus throughout the world. technology’s cutting edge. Visit
Now, a new generation of its Technology Hall in Kawasaki
globalisation is occurring as, in City on the outskirts of Tokyo
particular, companies from India and you are struck by the sheer
expand globally. The emphasis range of its interests — from
of these organisations — and of cloud computing to electronic
Fujitsu — is to combine a clear medical record systems, plasma
sense of having roots while also displays and point of sale
having the open mindedness to displays at supermarkets. The
embrace different business and range of products gives it a
national cultures. At Fujitsu, balanced portfolio and a radar
emphasis is put on the company for converging technologies and
being a global organisation with new innovations that can be
Japanese roots. It is multicultural transferred across products.
but clear in its origins;
globalisation with an open mind. The fruits of
Quiet experience
Fujitsu has a cadre of highly
confidence experienced managers. They
Respect and humility are know the company and its
deeply entrenched in Japanese
culture. Similarly, they
customers inside out. Many of
inform Japanese business
the senior leaders have worked
with the company all their
culture and corporations.
working lives. As engineers
Gung-ho competitiveness they have a constant urge for
is uncharacteristic. Rather,
improvement. They are like
collective aspirations are the mechanics tinkering with a car
focus — whether they are for the
engine in search of a slight
team, the company or society. but significant performance
The emphasis of Fujitsu’s enhancement. Things can
research is not on creating always be improved. Always.
sexy, must-have technological
fripperies. Instead, it regards
improvements in technology
as integral to improvements in
how we live and how societies
are organised and behave. This
belief runs deep, but quietly.
Co-innovation
rather than
domination
Technology companies place
huge store in innovation. But
at Fujitsu the emphasis is on
co-innovation with customers.
This is exemplified by the
company’s concept of Field
Innovation. This is a concrete
example of how Fujitsu

are how we deliver the brand
promise; and the brand positioning
is who we are and what makes us
special — we are the Japanese global
information and communication
technology (ICT) company with
a commitment to local service.”
Armed with a clear idea of what
it stood for, in 2010 the company
announced a new brand promise:
“shaping tomorrow with you”. It is
the first truly global branding exercise
ever undertaken and implemented by
Fujitsu and is intended to provide a
rallying point as the company changes.
The phrasing may be new, but
people within the company agree that
what it describes is quintessentially
Fujitsu. “The company’s brand
promise ‘shaping tomorrow with
you’ is a new way of describing
what we have always stood for,”
says president Yamamoto. “It is
already in our DNA, but stating it in
this way crystallises what makes us
different. It is a catalyst for change.”
And change is something that
Fujitsu cannot ignore because
the world it inhabits is changing.
The role of technology in society
is changing — and with it the
role of technology providers.
Of course, the high-tech sector
is always a vortex of change. It goes
with the territory. But from time to
time, there are big shifts. Examples
include the switch from mainframe
computers to client servers in the early
1980s; and more recently the move
towards ubiquitous devices such as
smartphones and tablet devices like the
iPad. Allied to this latest development,
the industry is now entering a new era
characterised by cloud computing.
Cloud computing uses the internet
to provide resources, software and
information on demand. People will
no longer need to store large quantities
of data or software on their personal
devices because they will be able
to access them from anywhere. For
users, cloud computing holds out the
promise of just-in-time computing;
they will no longer have the need
for expertise in, or control over, the
technology infrastructure. For many
users and businesses, this is a liberating
development. But for established
IT providers, such as Fujitsu, it
represents a radical departure.
“Three years ago we made a major
announcement on cloud computing
and it felt like an exciting new
direction. IT will be increasingly a
utility, accessed on demand,” predicts
Kazuo Ishida, a 36-year Fujitsu
veteran. “This has the capacity to
change everything about how, when
and where we access technology and
the uses we put to technology.”
Challenge on two fronts
On a commercial level, change is
necessary says Yamamoto because
Fujitsu faces two big challenges: the
need for global expansion and the
need to develop a new business model
fit for the cloud computing era.
Like many companies, Fujitsu
is extremely strong in its domestic
market and is active globally but
without the same level of success or
dominance. The company operates
through more than 500 group
companies in 60 countries around
the world. A total of 37% of its sales
and around 70,000 of its 172,000
employees are now accounted for
by overseas markets. Its target is to
generate more sales outside Japan.
While global in scope, until now
Fujitsu has lacked coherence to its
operations. The company’s slogan
in the 1960s was “infinite growth”.
The result was that Fujitsu amassed
a sprawling array of subsidiaries and
joint ventures. Among other things,
in the late 1990s, for example, it
acquired Amdahl in the United States
and ICL in the UK. It also had a joint
venture with Siemens in Europe. The
moves were often successful as stand
alone ventures but were too loose to
provide any critical mass. In short,
the whole was not greater than the
sum of its parts. A big problem was
that the subsidiaries operated under
a variety of different names, failing
to leverage the Fujitsu global brand.
“We have suffered from a lack of
gravity in Europe and elsewhere. In
those places, it seems as if we just
happen to be a global company,”
laments Chiseki Sagawa. “There
is a need to create a gravitational
force to pull things together.”
Acquiring gravity takes time.
Over recent years, Fujitsu has worked
hard at renaming and reclaiming
subsidiaries, to make more sense of
what it does and where it does it. In
2002 it brought ICL and Amdahl
under the Fujitsu brand. In 2009
Siemens’ stake in the joint venture
was bought out to create Fujitsu
Technology Solutions. In the United
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 13
LEADING CHANGE INSIDE FUJITSU
“‘Shaping tomorrow
with you’ is a new
way of describing
what we have always
stood for. It is already
in our DNA.”
States, Fujitsu merged three of its
independently operating businesses
in 2009. One name, of course, does
not necessarily mean one culture.
“We want to create a different sort
of global company,” says company
president Yamamoto. “All of our
companies have their own cultures
so we are creating a multi-cultural
global company. All these companies
work closely with their customers so,
as their customers develop globally,
we can help and develop with them.
We can help them globalise their
businesses. In the past there was a
tendency to leave our global business
to the independent discretion of our
subsidiaries outside of Japan, each of
which differ in terms of their origin
and subsequent development.”
In response, Fujitsu has reorganised
its global businesses along regional
lines with Richard Christou, corporate
senior EVP (the only Westerner in
the company’s management team) in
charge. “There has been a fragmented
approach but whatever we do
now has to be done globally,” says
Christou, who estimates that Fujitsu
is half way in its globalisation journey.
“Companies like IBM or Oracle offer
exactly the same experience wherever
you encounter them throughout
the world. We cannot do that. What
we can achieve is consistency of
values and objectives rather than
consistency of action. Responding
to customers has to be done locally
and individually. We want to be a
transnational organisation which shares
experiences and knowledge between
regions but which has a light centre.”
BUSINESS
While aiming to globalise alongside
its customers, Fujitsu is also clear
that it remains a Japanese company.
“We still need a base to hold this
global company together and that is
in Tokyo. That’s why we talk about
a global Japanese company,” says
head of R&D Kazuo Murano.
A new business model
The second big challenge facing
Fujitsu is changing its business model.
Big IT providers have already felt
the pain of an economic downturn,
the banking crisis and the arrival
of a new era of computing. Fujitsu
is no exception. A decline in its
solutions business has led to sweeping
reductions since 2008 in costs and
expenses across the company.
Key operations have been
restructured. In 2009, for example,
the company completed the transfer
of its hard-disk drive business to
Toshiba. Fujitsu’s LSI business also
shifted to a so-called “fab-lite” business
model — whereby the company
minimises its own production scale
by outsourcing to external foundries.
More fundamental structural
changes can be anticipated, but
there are signs that the worst may
be over. The company raised its
operating income from 68.7 billion
yen in 2008 to 94.3 billion yen
in 2009. It also set an ambitious
target of 185 billion yen for 2010.
Financial discipline is the first
step. But Fujitsu needs to renew
itself. Renewal comes from the roots
and the roots of Fujitsu have always
been firmly anchored in innovation.
As president Yamamoto explains:
“Computing is going through a
transformation. IT used to be in
a finite area. Now, we see that
through cloud computing there is an
opportunity to expand its role. Think
of areas such as agriculture. These
are the new areas we are exploring.
These applications of technology are
revolutionary. What was unthinkable
is now possible so we have to develop
in what were uncharted areas.”
Shaping tomorrow with you
Fujitsu itself is entering uncharted
territory. To simultaneously globalise
and be at the vanguard of an
expanded role for technology in
society is a big ask. The company
believes it is achievable if it stays true
to one of its fundamentals: staying
14 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010
close to its customers. This is the the authors
“with you” component of its brand Stuart Crainer
promise. To emphasise the point, scrainer@london.edu
Masami Yamamoto visited more than Crainer is the Editor of
100 corporate customers within the Business Strategy Review.
first three months of being president. Des Dearlove
Says Chiseki Sagawa, president of des.dearlove@
suntopmedia.com
Fujitsu’s platform strategic planning
Dearlove is an Associate
unit: “We are more humble than some Fellow of Saïd Business School
other companies. We have tended and a visiting professor
to be the follower rather than the at IE Business School.
visionary company. There are three
routes to success. You can either be
a visionary company, compete on
cost or you can focus on customers.
We are the third. We emphasise that
we understand customer issues and
we always finish the project.”
Staying close to customers is one
thing; helping them shape tomorrow is
quite another. Co-creation, popularised
by the late CK Prahalad, is fashionable.
Many companies talk about developing
products and services with customers.
But in reality it is far easier to provide
solutions to customers than it is to
develop them with customers. It
goes beyond co-creation to true co-
innovation. The latter takes an endless
reservoir of time and patience. Western
companies are not known for either.
Yet Fujitsu, “stubbornly trustworthy”
and endlessly patient, is a company
that is built for co-innovation. It
may well be its greatest asset.
Fujitsu’s new business model is
all about co-innovation. “This ability
is probably the biggest attribute
we have at Fujitsu,” says Sagawa.
“But we need to change the way
we work and think. In the past we
helped customers solve problems
they identified; in the future we need
to share common challenges. We
need to move beyond listening to
customers to innovating with them.”
“Shaping tomorrow with you”
is a big promise. We asked Fujitsu
president Masami Yamamoto what he
wanted the company to be famous for
in a decade. His answer was typically
bold but matter-of-fact. “Contributing
to society. Making society more
prosperous and more convenient.
It is all about challenging new areas
with customers. That is also an
important message for our employees.
It is about shaping tomorrow.”
The aspiration is clear. But the
philosophy remains grounded.
It is ‘dorokusai’ — down to
earth. But ‘dorokusai’ with a
new-found confidence.

Leading
thoughts
Making
better risk
management
decisions
During a three-year research
project on risk management
in large organisations, Julian
Birkinshaw and Huw Jenkins
interviewed three dozen executives
from a diverse array of business
sectors.Their findings reveal
that risk management must
be personal to be successful.
Managing risk has always been one
of the key functions of an executive.
But rarely have the consequences
of ineffective risk management been
as clear as they are today. Consider
three high-profile cases: BP’s
Deepwater Horizon explosion in
April 2010, Toyota’s recall of more
than nine million cars during 2009
and 2010, and Lehman Brothers’
collapse at the height of the credit
crisis in September 2008. All three
were caused by low-probability, high-
severity risks; and in all three cases
the consequences, in terms of loss
of life, environmental damage and
economic costs, have been severe.
LEADING THOUGHTS Making better risk management decisions
There are no simple ways of
avoiding these types of risks, and
yet the evidence suggests that some
companies are better able to manage
them than others. The credit crisis
illustrates this point very clearly:
while Lehman Brothers and Bear
Stearns were wiped out — and while
UBS, Citibank, Merrill Lynch and
Royal Bank of Scotland were badly
hit — several other banks (including
Goldman Sachs and JPMorgan Chase)
sailed through unharmed. What
explains the very different fortunes of
the winners and losers in this period of
unprecedented turbulence?
Our argument, in a nutshell, is that
in the years leading up to the credit
crisis, financial services companies
focused unduly on the formalisation
of risk management by developing
multistage procedures, with many
signatories, to evaluate what risks were
worth taking. They also relied on
externalisation of risk management to
a large degree — the use of expertise
and approval from outside parties
such as auditors, regulators and
credit-rating agencies.
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 41
Risky business
Risk is the potentially negative impact
arising from a future event, and it
can be calculated as a product of
the probability of the future event
happening and the scale of loss
associated with that event. Firms face
multiple risks of contrasting types
all the time; so, rather than think in
terms of removing risk altogether, the
task of the organisation is to learn
how to manage its risks appropriately.
Indeed, it is a truism in the world of
business that riskier activities require
higher rates of return to make them
worthwhile investments; thus, to a
large degree, the organisations that
become highly capable at managing
their risks are likely to generate
superior returns over time.
Risk management requires firms to
balance two distinct types of risks —
the ‘false positive’ risk associated with
investing in a potential opportunity
that does not transpire, and the
‘false negative’ risk associated with
failing to act on an opportunity that
did transpire. The consequences
of false positive and false negative
STRATEGY
There is no simple way
to build a supportive
culture. It takes many
years of consistent
messages and actions
from a leadership
team. But there are
nonetheless a couple
of basic principles
that can be applied.
errors are very different; effective risk
management is all about evaluating
the pros and cons of these two types
of errors and adjusting decision-
making processes accordingly. For
example, if an oil and gas company
is extremely cautious about investing
in new oilfields, it can generally
avoid costly false-positive mistakes
in the form of dry wells; but it risks
leaving money on the table that other
competitors can pick up. In other
words, the more one type of risk is
42 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010
minimised, the more the other type
ends up occurring.
So how do firms manage risk?
How do they bring to bear the
necessary level of knowledge and
expertise on difficult decisions? And
how do they ensure that individuals
act in the best interests of the firm,
rather than themselves?
Historically, the answer to these
questions was the model known as
‘bureaucracy’, the regulations and
structures used to control activity.
While the term is often used in a
pejorative sense, bureaucracy has
many benefits: it encourages the
development of formal rules and
procedures that transcend individual
idiosyncrasies and historical
orthodoxies. However, it also has
many unwanted side effects: it can
become overly rigid and specialised,
it encourages groupthink and it can
lead to depersonalisation and a lack of
ownership on the part of employees.
It is this last set of concerns, around
depersonalisation and loss of ownership,
that is most salient here. As firms grow,
they need to build formal systems to
generate economies of scale and scope,
but they also need to balance that with
the agility, personal accountability
and freedom of expression that come
from a small, more entrepreneurial
environment. While this point is often
made in the context of innovation
and creativity, it is just as valid in the
management of risk.
RoJ
Consider, for example, the winners
and losers in the credit crisis. While
there were certainly some notable
failures among small players such
as hedge funds, the major losses
were borne disproportionately by
the very large banks. This was partly
because small financial services
companies did not have the credit
ratings or balance sheets to carry
the so-called ‘super senior’ tranches
of the collateralised debt obligation
(CDOs) that ultimately got the big
investment banks into trouble. But it
was also partly because the decision
makers were close to the action,
highly knowledgeable, and personally
accountable for the outcomes of their
decisions. As one leading hedge fund
executive commented to us, “We

have robust informal systems, we
communicate naturally and we develop
our own views on what risks to take.
We get a return on our judgement”.
JPMorgan Chase, one of the
least-affected major players, also
had a highly cohesive top team
that took ownership of its risk-
management agenda. As is now
well known, CEO Jamie Dimon and
his team saw early warning signals
(back in 2006) of the credit risk on
mortgages and the market risk on
CDOs, as a result of which they
reduced the bank’s level of exposure
to mortgage-backed securities.
Most of the large investment
banks, in contrast, had hundreds
of employees working in risk
management, using procedures so
carefully defined that well-intentioned
managers could no longer see the
forest for the trees. According to one
report: “The risk governance failings
[of the banks] resulted from an over-
reliance on low-level risk decisions in
siloed businesses, product lines and
trading desks that ignored how these
exposures contributed to a firm’s
overall risk profile.”
LEADING THOUGHTS Making better risk management decisions
The net result was that some of the
investment banks ended up making
false-positive and false-negative
decisions. Not only did they steer clear
of promising lines of business that other
firms, such as hedge funds and private
equity houses, grew into, they also
made horrendous trading losses on
some of the lines of business they chose
to invest in. When a firm makes both
types of error at the same time, it is a
sure sign that the system is not working.
Three approaches
So where did bureaucracy go wrong?
In our view, it failed because it allowed
individuals to detach themselves, legally
and morally, from the system in which
they were working. We suggest there are
three complementary approaches
to managing risk in large firms:
– Formalisation involves using
system-wide procedures and rules
to evaluate and adjudicate on what
risks are worth taking.
– Externalisation involves making
use of the expertise and seal of
approval provided by third parties,
some required by law (auditors and
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 43
regulators), others optional
but widely used (credit ratings
agencies). Both of these approaches
are manifestations of bureaucracy,
the former controlled by the firm’s
management, the latter controlled
by third parties.
– The third approach, personalisation,
involves pushing the responsibility for
evaluating and making a judgement
around risk to those individuals who
are making decisions and requiring
them to live with the consequences
of those decisions.
While all three are necessary and
used to varying degrees all the time,
the recent evidence in banking
and elsewhere suggests we need to
redress the balance back towards
personalisation, especially in large
firms. Goldman Sachs, one of the best
performers through the credit crisis,
is frequently held up as the acme
of personalisation. As the Financial
Times reported: “Employees [at
Goldman] typically view themselves
as being affiliated to the bank, not the
business line, and there is a strong
ethos of shared accountability.” And
in JPMorgan Chase, Jamie Dimon
is known to have taken an active
personal role in risk briefings. But
Goldman Sachs and JPMorgan Chase
are clearly exceptions: other firms in
the sector relied, and continue to rely
heavily, on bureaucratic approaches to
risk management.
The personalisation approach
to risk management applies in
many different contexts. In the
pharmaceutical industry, for example,
firms make high-stake investments in
new drugs all the time. These firms
have sophisticated formal systems
and stringent external regulations;
but, in addition, they are able to
rely on the strong ethical norms and
professional standards of the medical
fraternity, a form of personalisation.
As one observer noted: “Such experts
are driven by a public willingness
to improve collective knowledge of
products rather than by a private or
commercial will to distribute them.”
It is this shared accountability among
medical professionals that helps to
minimise false positive risks.
Or consider an entirely different
context, the social services profession.
There was the tragic case in the
UK in 2008 of the death of ‘Baby
Peter’ at the hands of his mother
and stepfather, despite accumulating
STRATEGY
evidence of abuse. On further
investigation, it became apparent that
the local social services organisation
had formalised its support services
to such an extent that social workers
were spending 60–80 per cent of
their time on paperwork, rather than
out in the field talking to the families
of at-risk children. There had been
60 separate appointments with Baby
Peter and his mother; but, because
these were spread over so many
different social workers, the full story
had not emerged until too late. One
investigation into this case concluded
that computer technology “replaced
a system where social workers wrote
case notes in narrative form, which …
made it easier for different officials to
quickly pick up the details of complex
cases”. Or, in our terminology, the
formalisation of risk management,
through computer monitoring and
nationally-imposed targets, squeezed
out the personalisation approach that
many would see as the essence of
effective social work.
Personal touch
While the concept of personalisation
has intuitive appeal, many people
struggle with how to apply it in a
large organisation that, by definition,
relies on significant amounts of
formal systems to get work done. Our
research suggests three necessary and
supporting elements.
High-quality insight It goes
without saying that those making
decisions require good quality
information, effective analytical tools
and the competence to interpret this
information. But it is rare for all
these things to come together. More
often, decisions get made with poor-
quality insight from self-interested
sources and with relevant information
fragmented across different parts of
the organisation.
The credit crisis provides abundant
examples of such failings. Lloyds
TSB’s acquisition of HBOS, for
example, was a massively risky
decision made on the basis of very
limited insight. While the board of
Lloyds TSB was clearly under a lot of
pressure from the Bank of England,
its primary responsibility was to its
shareholders — and it failed them.
At a more micro level, studies have
looked at the securitisation of mortgage
loans in the run-up to the credit crisis.
They show that, when loans were
44 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010
securitised and sold on to non-banks,
the likelihood of default was far higher
than when loans were sold to affiliates
of the originator. The non-banks, in
essence, lacked the high-quality insight
to make the right judgements about
the risks they were taking.
Effective personalisation of risk
management is therefore about building
a system that puts the right information
in the hands of those making the call
and then transforming that information
into insight through deep experience.
Here’s one example of how this
works in a different setting. The UK
police force gathers intelligence on a
daily basis about criminal activities,
community affairs and so on. Usually
these are dealt with quickly and without
note; but, occasionally, an incident
flares up and becomes really serious.
To better alert themselves to the
potential flare-ups, and in recognition
of past failings, the police force in the
late 1990s instituted a critical incident
approach in which an employee of any
rank could call together a cross-force
group to consolidate all the available
information about an incident and
make a call on how to react. Critical
incidents are only called occasionally,
when the officer’s ‘antennae’ are
twitching, but they provide an effective
way of quickly bringing to bear all the
different views on an issue and reaching
a thoughtful decision.
Many large companies have also
developed specific techniques for
improving the quality of insight around
important decisions. For example,
one major mining company has an
independent evaluation team that
will put together their own analysis
of a proposed investment (such as a
new mine) before a decision is made.
Almost in the manner of a court of law,
the investment committee reviews the
proposal by the business unit seeking
investment funds; then, it considers
the independent team’s assessment.
By having two points of view, the
quality of insight is improved and the
likelihood of a false positive investment
is significantly reduced. This company
now has an enviable record in making
profitable mining investments.
Personal accountability It’s
no surprise that effective risk
management requires personal
accountability, but most firms get
this wrong as well. Sometimes there
are too many decision makers, or the
decision maker is too far removed
So where did
bureaucracy go wrong?
In our view, it failed
because it allowed
individuals to detach
themselves — legally
and morally — from
the system in which
they were working.
from the action to feel any genuine
responsibility. And, often, there is no
link between the decisions taken and
the rewards provided. For example, in
the run-up to the credit crisis, many
banks traded in risky securities to
optimise revenue growth or short-term
profits without giving due regard to
the appropriate cost of capital or the
long-term nature of these securities. It
is now conventional wisdom among
commentators that a key factor in
the creation of the current financial
crisis was this focus on short-term
accounting profit and the use of
highly geared incentives around it.
What is needed, instead,
is a system in which personal
accountability is rewarded and in
which the individual or team with the
highest-quality insight is also the one
making the decision. For example,
one of the basic principles that every
airline captain knows well is to have
risk decisions made at the appropriate
level. ‘Appropriate’ here means the
level at which the individual has the
necessary experience and maturity to
make a good decision. The captain
may, for example, delegate specific
decisions to engineering specialists or
dispatchers; but the decision to fly the
plane rests with him or her — not on
the wishes of the air traffic controllers
or the airline’s chief executive.
The same logic applies in policing.
In the critical-incident model
described above, a key principle is
the concept of command, whereby
one individual leads and coordinates
a response, even if it cuts across
multiple departments or police forces.
In the business world,
accountability is as likely to sit with
a team as with a named individual,
but the logic is essentially the same.
Every board member in a public
corporation, and every partner in a

partnership, understands his or her
formal accountability. But clearly
the top of the organisation is not the
appropriate level for many decisions
to be made. As with the airlines
and the police, firms need to find
mechanisms for pushing personal
accountability down to those who are
closest to the action without those
at the top abrogating their overall
responsibility for the decisions being
made on their watch.
Supportive culture The informal
norms of behaviour in a firm, its
culture, should support the principles
of high-quality insight and personal
accountability. But all too often, these
informal norms end up undermining
the effectiveness of decision making.
Some firms exhibit a fear culture
in which bad news is hidden from
top executives; some have a purely
mercenary culture in which everyone
looks out for themselves; yet some
other organisations suffer from a
culture that’s chronically risk-averse,
with almost zero tolerance for false-
positive errors.
Of course, there is no simple way
to build a supportive culture. It takes
many years of consistent messages and
actions from a leadership team. But
there are nonetheless a couple of basic
principles that can be applied. One is
the need for transparency of purpose, a
higher-order reason for the organisation
to exist. Many investment banks such
as Lehman Brothers and Bear Stearns
had formal vision statements, but the
credit crisis revealed that these were
full of empty rhetoric. Transparency of
purpose, instead, refers to visible and
ongoing commitment to a set of non-
financial objectives.
Consider, for example, a leading
mining company that committed
a decade ago to eliminating one
type of risk: employee injuries at
work. All leaders signed up to this
goal, all employees were trained
on the company’s safety standards,
measures of lost-time injuries were
monitored for all sites, and managers’
compensation was linked to safety.
Today, all meetings, even those in
white-collar environments, start with
a safety update. Safety thinking is
deeply ingrained in the minds of
individuals throughout the company,
and the resulting safety record is
impressive. Cultural transformation,
in other words, is possible when it
is tied to a very clear purpose that
everyone can identify and when it
LEADING THOUGHTS Making better risk management decisions
is reinforced through consistency Authors
of action. For example, one of the Julian Birkinshaw
key features of the critical incident jbirkinshaw@london.edu
approach to policing described earlier Birkinshaw is Professor of
is to acknowledge the efforts of the Strategic and International
Management, Senior Fellow
individual who calls it — even if it of the Advanced Institute of
proves to be a false alarm. Management Research and
The other principle is a refusal Deputy Dean for Programmes
to simplify the big picture. Academic at London Business School.
studies have been done of nuclear Huw Jenkins
huw.jenkins@btgpactual.com
power plants and aircraft carriers,
Jenkins is a Managing Partner
locations where errors can have in BTG Pactual. He was formerly
catastrophic consequences. The studies CEO of UBS Investment
have sought to understand how these Bank and has an MBA from
‘high reliability’ organisations function. London Business School.
It turns out that one of the key
features is that individual employees
— involved, for example, in routine
maintenance activities — are expected
to take responsibility for seeing how
their work fits into the big picture.
Rather than compartmentalising every
task, employees are encouraged to
look across organisational borders
to understand how their work has
implications for others.
A balanced system
The components of a personalised
approach to risk management are
far from surprising. However,
personalisation should not be
viewed as a substitute for the
formalisation and externalisation
of risk management — it must be
a complementary approach. The
best-managed financial services
companies essentially balance the
three models. There is true ownership
of the decision to underwrite a risk
by the manager or trader who has
the appropriate level of expertise and
insight. There are formal systems for
setting limits for exposure to the types
of risks the organisations will tolerate.
And external agencies are brought in
periodically to validate and quality
assure the internal processes.
Once again, Goldman Sachs is
an interesting example. As a former
partnership, there is a greater degree of
personal accountability and ownership
than in most other banks; but,
according to CEO Lloyd Blankfein,
“Risk and control functions need
to be completely independent from
the business units.” Personalisation
and formalisation at Goldman Sachs
are the yin and the yang of effective
internal decision making: they keep
the organisation in harmony.
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 45
REVIEW

Values make the organisation as well as the men and women

within the organisation. What are you passionate about?

FACE VALUES
“Like anything
With values else, values are
nothing is best demonstrated
as opposed to
impossible talked about.”
Richard Hytner is Deputy
Chairman of the global advertising
agency, Saatchi & Saatchi.
Responsible for the company’s
strategy and for its programme
of continuous transformation,
he works with leadership teams
around the world to accelerate
transformational performance.
Hytner joined Saatchi in 2003,
having previously been UK CEO
and Chairman of the advertising
group, Publicis, and Chairman of
The Henley Centre. He was also
a co-founder of the Manchester
United Supporters’Trust, reflecting
his belief that brands are truly
owned by the people who use them.
In this interview with Richard
Brass, Hytner discusses values,
‘Lovemarks’ and the overriding
importance of purpose.

How important are values in business?

Tremendously important. At Saatchi,
we talk about being purpose-driven,
having a really clear purpose. The best
ally you can have in business is a very
strong sense of what your dream is,
what your huge challenges are and
then, critically, what beliefs and values
underpin that. We spend a lot of time
with our clients getting them to a
clear, strong sense of purpose. A lot
of companies have a mission statement
or a vision statement and they’re just
Photo: lc griffiths

words on a page. Unless you can bring

those to life with a strong sense of
values — and explain why those values
make you different from anybody
else, then it’s just a kind of generic

72 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010

 FACE VALUES nothing is impossible

wish. Typically what differentiates

companies is less what their goal
happens to be and much more the
kind of character, personality and
beliefs that drive them. That’s where
you look for sources of distinction.

Which companies stand out

for their values?
If you compare and contrast some
of the more disruptive, challenging
organisations — Virgin’s an easy one
to quote, but also note Southwest
Airlines and, these days, the Amazons
and the Googles — they have values
that in some way make it really clear
whether you belong or you don’t.
They’re kind of lighthouse companies.
They put themselves out there and,
on the basis of that, their customers
and their employees self-select. That’s
one of the great advantages they have
over the market leaders who feel that
their values have to be sufficiently
broad that they don’t quite manage to
describe who in essence they really are.

What are the essential values within

Saatchi & Saatchi?
We have what we call a spirit, which is:
“Nothing is impossible.” That’s a spirit
that’s quite topical. We just celebrated
our 40th birthday with the original
Saatchis, Maurice and Charles, who
coined that mantra. It’s something
we have held very dear since they
left. Unless you are the kind of person
who signs up to behaviour that says
nothing’s impossible, you’re not really
a Saatchi person. We’re looking for
radical optimists, people who really
believe they can change the world
— and it’s very, very defining.

Demonstrating values
How do you get that kind of thinking
across to your clients?
Like anything else, values are best
demonstrated as opposed to talked
about. You have to be a little bit wary
about shouting about values because,
quite often, you can protest too much.
If I want to make you feel that I’m

ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 73

REVIEW
FACE VALUES
“We believe in the
unreasonable power
of creativity. We also
believe that an idea is
not an idea until it’s
executed brilliantly.”
funny, I tell you a joke. I don’t say
I’m funny. Values work like that. We
would like to think that our clients
look at us and say, “My goodness,
they’re real can-do people.” They
don’t actually have to say they’re
‘nothing’s impossible’ people. So you
don’t often have to advertise your
values or give them too much voice,
but you do have to make it really
clear to your own people that this is
the behaviour that we expect, that we
reward and that we hold dear.
Saatchi has developed the concept of
Lovemarks instead of brands. How
important are values to that concept?
We have eight core beliefs, one of
which is that we believe in the power
of creativity to earn clients’ loyalty
beyond reason. Everybody who comes
to Saatchi, if they don’t buy into the
fundamental idea of Lovemarks, then
they’re not really going to have a
great time with us. We believe in the
unreasonable power of creativity. We
also believe that an idea is not an idea
until it’s executed brilliantly. Ideas can
be cheap. What makes an idea really
special is when it’s out there.
How do you instil those values
throughout your organisation?
By a massive commitment to training
and development. In the last three
74 BUSINESS STRATEGY REVIEW ISSUE 4 – 2010
years, I have personally overseen
the training of 3,500 people. I’ve
been to every continent in the world
to talk about the purpose of the
company. Everywhere we go, we
get the purpose out first. Our chief
executive, Kevin Roberts, is fantastic
at referencing the purpose in pretty
much every communication he has.
Whether it’s one-on-one or an all-staff
communication, it’s always rooted in:
“We are this kind of company, this is
what we’re trying to do, here’s what we
believe and that’s why we’re making
this decision.” It’s constant, to the point
where people really do know the lingo.
Again, you’ve got to be terribly careful
that people don’t just sing the company
song. They’ve actually got to feel it.
For us, the only way of giving them
that chance is to give them two-day
experiences around the purpose
of the company and how to take
Lovemarks thinking into our clients’
business and in what kind of spirit.
It’s a disproportionate emphasis on
training and development.
Increasing importance
Are values more important in
business now than in the past?
I think they are, because people
today have huge expectations of the
companies to whom they’ll lend their
talent, particularly Gen Y. That kind
of generation is simply not going to
gift their talent to companies that
aren’t really clear about what they
stand for. And increasingly, if they
don’t stand for making the world
a better place, then they will just
be rejected. That’s why we think
sustainability’s going to be so very
important. Not simply because it’s
a kind of business imperative, but
because it’s a talent imperative as well.
We find the best people will go off
and do their own thing if they don’t
trust businesses to house the kind of
beliefs they do or if they can’t find the
right business doing the right thing by
the planet and by people.
The younger generation simply will
not come to work for companies that
haven’t got massive commitments to
targets on carbon reduction, companies
that don’t give their employees time off
to do things that are good for society or
companies that aren’t really conscious
of the communities directly around
them. Among clients too, if anything,
I think I’ve seen an acceleration in the
sustainability agenda through hard
times because I think most companies
now have wised up to the fact that this
could be a great way to save a great
deal of money.
What does Saatchi do in terms of
contribution to the community?
For years and years we’ve encouraged
our creative talent to unleash their
brilliance on social causes. We have
huge pro bono programmes in place
that allow people to do fantastic work
for causes they care about. That’s
number one. Number two is that, three
years ago, we launched a programme
called ‘Do One Thing’, which is to give
people a mission to do one thing every
day that they think is going to make
their lives, their immediate families or
their communities feel better. That was
launched in a spirit of real optimism.
It isn’t saying “you must stop drinking
water out of bottles” or “you must stop
bringing the car into work”. It’s much
more giving people a sense of “we want
you to do one thing that’s going to make
you personally happier and feel better”
because we feel these movements are
best done in a spirit of optimism as
opposed to fear.
What do you do yourself to
contribute to the community?
Again, I’m encouraged by our
CEO, who leads from the front. He
has a massive programme in place
himself, so everyone knows this isn’t
just something that’s negotiated but
is something that’s encouraged. I
personally am chairing a sustainability
educational enterprise in Sierra
Leone, and I went there this year to
have a look at how our kids are doing.
I’m currently chairing the Mending
Broken Hearts appeal for the British
Heart Foundation for a big piece of
pioneering research. And Michael
Hay at London Business School has
a thing called the ‘Business Bridge
Initiative’, and he’s asked me to be
a trustee of that.

Shaping careers
Do you think values should
be an essential part of business
school education?
I do and I’m really encouraged,
because as an executive fellow at
London Business School I have been
in the privileged position of seeing
the emergence and development of
the school’s own ‘Vision and Values’
project. One of the great things that
Sir Andrew Likierman is bringing
to the school is a really strong sense
of values. I hosted a workshop with
him and a team from right across
the school, a really diverse group of
faculty and people from marketing and
operations; it was really encouraging
to see how he’s set a tone in which
it’s acceptable to disagree with one
another, even fun to disagree. He’s
leading the values from the front,
he’s encouraging strident debate,
he’s encouraging diversity of thought
and he’s letting people have their say,
which I think in a business school is
so important.
Aside from Saatchi’s particular
values, what values have guided
you in your career?
I believe that emotional intelligence is
every bit as important as intellectual
intelligence. I’ve always believed in
family first. I believe in the power of
humour and humility in business.
These are the kind of things that I
hold dear and try to practise as best
I can. As you get older and wiser,
you get more sure-footed about what
works for you and, more importantly,
you get more unabashed about living
the values that you hold dear, which
makes it much easier to navigate your
way through the tough times and
complexity in business, because people
begin to see what kind of person you
are, what it is that’s going to really
bring out the best in you.
We invite people — I’m now
running programmes across the world
on this — to marry personal purpose
with organisational purpose, to make
sure what it is that they most want to
do and what they most believe marries
with (and hopefully amplifies) the
FACE VALUES nothing is impossible
Author
“I believe that emotional Richard Brass
intelligence is every richard.brass@gmail.com
Brass is a business and finance
bit as important as journalist who has written for
newspapers including the Daily
intellectual intelligence. Telegraph, The Times and the FT.
I’ve always believed
in family first. I
believe in the power
of humour and
humility in business.”
company’s purpose. If it doesn’t, it’s
still a useful exercise, because people
can quickly realise that they’re in the
wrong place and need to move on.
This year, we’ve taken 100 people
across the world, our key inspirational
leaders, through personal purpose
reviews in the hope that they can see
things about the company’s purpose
that can really accelerate their own
personal purpose and vice versa.
What’s the most important piece of
advice you could give about values?
When I was in my last class of
the Sloan programme at London
Business School, somebody said
to Rob Goffee, Professor of
Organisational Behaviour, “If you
had one piece of advice as you go into
the world, what would it be?” He said,
“Be yourself — more — with skill.”
That’s become the mantra that I use.
It’s brilliant advice, and I wish I’d
adopted it when I was 21 as opposed
to waiting till I was 42. It has guided
me to make some fundamental
decisions. I think that it operates at the
personal level and at an organisational
level. And it’s all about values. I’ve
shared that with my kids and with
anybody who seeks out advice. Get
on with being who you are — just
get better and better at it.
ISSUE 4 – 2010 BUSINESS STRATEGY REVIEW 75