I've been reading more about the beneficial effect of spreading good cheer. On this basis, take Management Today's annual round-up of Britain's most admired companies as the (local) antidote to 24/7's CEO ousting list.
The MT listing is compiled by peers -- among those who steer the decision are Britain's 10 largest companies in 24 sectors, which evaluate peer businesses alongside industry analysts. They grade a company using nine measures, including innovative capacity, ability to attract and retain talent, quality of products and management, as well as financial solidity.
There's been speculation as to how accurately the listing reflects the the performance of the business across nine criteria -- why did Diageo, the drinks business, not only take top honours this year but score in the top five in seven of those categories? Are its products -- booze brands including Guinness, Gordon's, Dom Perignon -- any more admirable this year than last, asks IMD professor Phil Rosenzweig. Why should a long-serving CEO and management team's eight years of talent development skills suddenly become so praise-worthy?
Rosenzweig attributes Diageo's sudden ascension to the "halo effect":
"Dazzled by the golden glow of growing revenues and improved margins, managers now perceive Diageo as better across the boards. The result is an eye-catching cover story, but one based on flawed conclusions. Nine separate categories, with data scrupulously analysed to create an overall winner? Not at all. Studies like this do little more than capture perceptions shaped by financial results."
Just as Diageo's financial glow has dazzled admirers, so has M&S's difficult year tarnished overall perceptions -- it dropped from the most admired company of 2007 to a lowly 29 in this year's ranking. A difficult year for retailers was probably compounded by Sir Stuart Rose's ill-advised decision to become chairman as well as chief executive -- a sign of hubris that clearly hit the wrong note with peers.
So maybe the list's not entirely objective. But the clue's in the title -- it's Britain's most admired. So here are the CEOs who led the companies in the top 10.
- Paul Walsh, Diageo
- Neil Carson, Johnson Matthey
- Patrick Cescau, Unilever
- Jeremy Darroch, BSkyB
- Sir Terry Leahy, Tesco
- Brian Souter, Stagecoach
- Sir John Rose, Rolls-Royce
- Peter Clarke, Man Group
- Gene Murtagh, Kingspan
- Philip Yea, 3i