This Humanizing Growth conversation from the Institute for Real Growth is with the former chief executive of Burberry, later head of retail and online at Apple. It runs from her upbringing in Indiana through both transformations to what she expects of marketing leaders now.
One method recurs at both companies. Before setting a direction, she studies why the institution was founded and what it was for. Her phrasing is that you have to look backwards before you can ever look forward.
Key findings
- At Burberry the purpose the leadership arrived at was custodial rather than competitive. The company was 150 years old, and the job was to keep the institution strong and relevant so it could last another 150 years.
- The business doubled in five years. Alongside it, one percent of profits went into the Burberry Foundation, under a question the company set itself: how many lives can we touch and transform by the power of our performance.
- The company distinguished soft strategies from hard ones and ordered them deliberately. The soft strategies created the culture and united the team, and those in turn enabled the hard strategies, the revenue, and the profit.
- Asked for the biggest blocker to long term multi-stakeholder value creation, she names short-term reporting. Quarterly reporting takes far too much of a chief executive’s time, and part of the remedy sits with boards.
What she took from Indiana
She describes being raised with purpose and what she calls Midwestern core values. The line she returns to is her father’s. He could teach her anything, but he could not teach her to care.
The Burberry job was one she turned down more than once, because she was happy in New York. What changed her mind was a challenge from her predecessor about how few chief executive roles were held by women. She frames the decision as responsibility rather than ambition. If she did it and succeeded, it would empower more women.
Working with visionaries
Her years acquiring and scaling founder-led brands left her with a firm view. Every brand needs a visionary, and every company needs a creative at the table, because they are the ones who see around the corner and warn what is coming.
The same backward-looking method shaped her arrival at Apple. She studied why the founder created retail in the first place, including his instruction that the job was to tell customers things they did not know, and worked forward from that to the store experience.
She describes her own discipline as marketing even though she has never held the title. A marketer’s job is to connect the dots between the history, the purpose, the customer, and the culture.
Leading a large workforce directly
At Burberry she recorded a video every week for 11,000 people, kept to about three thoughts in three minutes and shot on a phone. She carried the habit to Apple, where 55,000 people worked in her organization and the expectation was a translated email. The videos built recognition and trust across stores.
Within six months the organization ran a large crowdsourcing exercise, asking every employee worldwide what they felt the company should be doing more of in their community. Thousands of responses were sharpened by the stores themselves and edited down to eight, which then shaped the new in-store experience.
The principle underneath it is structural. She says companies need to be flatter and that she does not believe in hierarchy, because the people working with customers in their own communities know more than she does.
The crisis conversation she remembers
In 2008 the top 100 were called together to take 50 million pounds out of the business over three to four months. She told them she had never done it before and became visibly emotional. The team leaned in further rather than less, which is where she locates the lesson about authenticity.
The rule they set for the cuts protected the front. Nothing consumer facing was to be cut, and the stated goal was to come out of it stronger.
The S nobody is measuring
On environmental, social, and governance work she sees real traction on the E and the G, and a gap in the middle. The social element is still not clear. Her questions for a company are specific: how are you partnering with non-governmental organizations, and what financial or human capital are you contributing.
Her ambition for reporting goes further than better disclosure. She wants a day when the statement companies are judged on is not only profit and loss but people and impact, noting that laying off thousands still lifts a share price.
What the job of marketing now is
Ahrendts rejects the word marketing for something broader. She defines the work as building a lifelong relationship with every stakeholder, which takes in internal culture and communication as well as customers.
That leads to her prediction, and to the condition attached. This is probably the greatest time in history to be a marketer, and the future chief executives will be the world’s greatest chief marketing officers. The condition is that they stop staying in their lane and take responsibility for every stakeholder rather than reporting upward and stopping there.
On how to lead it, she refuses the either or. You lead from the front and you empower others, in that sequence. People want to know where the organization is going and why, and then to be left to move.
Scope and limitations
The Burberry and Apple accounts are the speaker’s recollections of her own tenure, given in conversation. The doubling of the business and the foundation contribution are stated from memory, without published figures attached.
Source
This page summarises HGS #35: Angela Ahrendts (former CEO, Burberry) on the role of the CMO, sustainability and purpose, by Marc de Swaan Arons.