CEOs and individuals in business leadership roles are frequently confronted with the dichotomy of making decisions to ensure the long term health of their companies, while maximizing short term profits. Their management roles compel them to lead the organization as if they are owners, but in reality, these organizations are owned by and at the mercy of investors and customers who determine the value of their products and services.
In a recent survey conducted by Fortune Magazine, 77% of CEOs said it would be easier to manage their companies if they were private. This feedback comes in a climate of increasing numbers of activist investors who purchase a significant amount of company stock, then proceed to make recommendations to the board and company leadership on how they should run it to increase value. To be fair, all such suggestions are not bad, and some have led to considerably positive results in the bottom line of these companies. But these CEO owners may find that their company’s mission and purpose are no longer aligned with where others want them to go.
Customers also have a powerful voice in shaping corporate strategies and decisions. Pepsi worked hard over several years to reformulate its diet cola to remove aspartame, thereby meeting the needs of people who wanted to move away from artificial sweeteners. However, many other diehard Diet Pepsi drinkers didn’t like the taste with the sucralose replacement, and complained loudly. So Pepsi recently announced that the old aspartame formula would return to the market, and they will sell both versions to meet the needs of all those customers. Oh, and did I mention that their sales volume slumped more than 10% during one of the quarters that the aspartame formula was off the market?
Ultimately, companies are at the mercy of and owned by their financial stakeholders. Whether you purchase shares of stock or a $5 product, you vote with your wallet on their future success. Strategic and principled decisions on the part of the board of directors and leadership team, that don’t benefit the stakeholders tend to become quickly overturned. They may hold critically important positions in the company, but the most important decisions are driven by clients and investors. Because if clients don’t buy-in to what you’re selling, you won’t be selling much for long. And if investors don’t think you’re a good growth prospect, they won’t invest in your future.
Ownership in our personal lives mirrors the corporate experience. We pursue and accept positions based on our skillsets and a desirable salary. We move up the career ladder based on positive feedback from others in terms of our potential and added value. We take on different assignments at various companies because someone has said that we need to do it, even if it doesn’t fit our dreams. Employers invest in us. Clients decide they want what we’re selling. And if we’re not careful, we find ourselves in a position where we’re no longer calling the shots on our own careers, our development or our lives.
This is especially true for those in the spotlight; who are well-known or famous in their community, industry or environment. Several recent examples in the Detroit area sports world include Calvin Johnson, a 30-year-old all-time leading wide receiver for the Detroit Lions, and Pavel Datsyuk, a 38-year-old star of the Red Wings Hockey team. Johnson retired after the 2015 season walking away from a $16M salary because he was simply tired of the wear and tear on his body. Datsyuk opted to walk away from $5.5M in the middle of his contract to return to Russia and play his remaining few years in his home country. Their team owners, team mates, and fans desperately wanted them to stay; people who had emotional and financial investments in their careers. But they each made a difficult decision to do what they knew was best for them personally and their families. They decided to own themselves.
Who Shapes YOUR Decisions?
So the question for you and me is, what decisions are we making because of pressure from someone else who has invested time or money in us? It may be a mentor or sponsor; a spouse or parent; fans, friends, social media followers; customers or financial investors in our business enterprises. Who has expectations of us that aren’t aligned with our expectations of ourselves, and our vision for the future? What will we lose by following their path of least resistance? What will we gain by following our path of greatest attraction? The goal at a personal level is to own our decisions, our work and our future. We must avoid making decisions driven by short term financial opportunity alone, and instead take the long term view of how we can add value to others and fulfill our purpose. This means avoiding compromise with those who don’t support our values and goals. So choose carefully. Choose wisely. Who owns YOU?