“Desk Notes” is a working-greenhouse of eclectic thoughts, ideas, and micro-essays in process of germinating into presentations, speeches, articles, and commentaries, with a focus on business, strategy, and management.
Michel Bergerac
“At Revlon, we don’t sell frozen peas, we sell dreams.” Michel Bergerac articulated this brilliant, innovative, cut-to-the-bone Revlon concept-statement in 1976, meaning to say, basically, that while Revlon is a manufacturing company like any other manufacturing company inasmuch as it acquires earth-extracted raw materials and upgrades them into value-added consumer packaged goods, as far as the company positions itself, and as far as the purchasing public is concerned, Revlon is about one thing and one thing only: “How our products transform you into the most beautiful person in the world.” Masterful corporate positioning. And only subtle, off-center reference to Brand Revlon. Absolutely perfect.
Charles Revson founded Revlon in New York City in 1932. Legendary Revlon CEO Michel Bergerac became his hand-picked successor in 1974. Over eleven years, Bergerac made dozens of acquisitions beyond core cosmetics into unexpected yet, in fact, logically connected sectors such as vision care, drugs, and medical diagnostics, and proceeded to transform Revlon into a major health care industry player. By 1984, health care was a major contributor to Revlon’s corporate profitability.
Under Mr. Bergerac’s leadership in the consumer packaged goods sector, Revlon became an early adapter in the use of strategic management analytical tools for evaluating the corporate portfolio, business units, product lines, and product life-cycles in discernment of where to invest, where to stand firm, where to harvest or divest. Perfume brand Charlie was the first Revlon product to undergo such scrutiny. Charlie was launched in 1973 behind a breakthrough TV advertising campaign, one of the most successful of all time, targeting the newly emerging, free-spirited, 20-something independent woman, featuring model Shelley Hack as smiling and confident in a glittering gold pantsuit by Ralph Lauren driving a yellow Rolls Royce convertible to the curb of Café Carlyle wherein everyone inside knows her and, wherein, none other than Bobby Short at piano, sings the jingle-praises of Charlie; within three years Charlie was the best selling perfume in the world. However, nevertheless, strategic analyses indicated the possibility of downside market vulnerability for the product. As a result of findings, as an insurance policy, Mr. Bergerac introduced Jontue in 1976, a perfume created to appeal to a more romantic audience with the catchline, “Sensual, but not too far from innocence.” In short order, Jontue became the second largest selling perfume in the world while Charlie never skipped a beat at Number 1; an impeccable alignment of creativity, art, and business strategy. Forty plus years later, amazing to note, in such a ferociously competitive sector, Charlie and Jontue continue to remain well-stocked on Fragrance Department shelves of notable emporiums.
Mr. Bergerac, always pushing the envelope, said this to The New York Times in 1976: “The most important thing is to seize a trend, and when we come in with our might it won’t matter that we weren’t the first. Everyone will think we were.”
Reassess Strategy Continuously
“Strategy is like French bread, you have to bake it fresh every day,” from a speech by Patrick Duggan. Put another way, “No plan survives first contact with the enemy.” Prussian Field Marshall Helmuth von Moltke (1800 - 1891), known as Moltke the Elder, considered a tactical genius and the Father of Modern Battlefield Strategy, shifted thinking away from the traditional, set-piece battlefield master plan to variable schemas with pre-established options and contingency plans, in our time, a methodology we call scenario forecasting. According to Field Marshall Moltke, “No plan of operations extends with certainty beyond the first encounter with the enemy’s main strength,” that is to say, in a constantly evolving environment, strategy must be continuously reassessed and readjusted. Sir Winston Churchill, Prime Minister of the United Kingdom from 1940 to 1945 and again from 1951 to 1955, said, “Plans are of little importance, but planning is essential.” As Supreme Allied Commander of the Allied Expeditionary Force in Europe, so named in 1943, and 5-Star General of the Army, Dwight Eisenhower commented, “Plans are worthless, but planning is everything.” Eisenhower also said, “The very definition of ‘emergency’ is that it is unexpected, therefore it is not going to happen the way you are planning.” On the other hand, probably no one has expressed this existential concept more eloquently than boxer Mike Tyson when asked if he was worried about Evander Holyfield’s fight-plan in regard to their upcoming June 28, 1997 engagement in Las Vegas when he said: “Everyone has a plan until they get punched in the mouth.”
Strategy 101
Strategy is movable action wherein the attainment of critical and specific objectives is everything, meaning, for example, in warfare, decisively defeating the enemy; and in business, achieving and perpetuating market supremacy. Also of note, in the realm of business, as in warfare, strategy is, first and always, competitor-driven. When a business discussion does not include reference to competitors, it is not about strategy.
Strategy is not an official document gathering dust on a desk; rather it’s a living, thinking, breathing, open-ended modus operandi.
If a business environment may seem to be evolving slowly, beware; such may be, in fact, a dangerous illusion. Be mindful of the safety warning inscribed on passenger-side-mirrors of motor vehicles: “Objects in Mirror Are Closer Than They Appear.” Always keep strategy well-ahead of developing events.
David Ogilvy
Impresario David Mackenzie Ogilvy, 1911 to 1999, the man who put the eyepatch on the model wearing the Hathaway shirt, who coined the word “Schweppervesence,” and founded Ogilvy & Mather in 1948, is known as “The Father of Advertising.” Having been trained early-on at George Gallup’s Audience Research Institute, he attributed the success of his advertising campaigns to meticulous research, and is on record as having said, “Advertising people who ignore research are as dangerous as generals who ignore decodes of enemy signals” and “Never stop testing and your advertising will never stop improving” and “The most important word in the vocabulary of advertising is TEST. If you pretest your product with consumers, and pretest your advertising, you will do well in the marketplace.” All of these insights, of course, are directly transferrable to the formulation of business strategy. David Ogilvy may be one of the first to publicly recognize advertising as both art and science; that success in advertising demands coordinated input from the left and right sides of the brain.
Matthew Weiner, creator of hit-TV period drama series “Mad Men,” 92 episodes in the timeframe 2007 to 2015, acknowledges his lead character, Don Draper, was in many ways modeled on David Ogilvy, and that he studied Ogilvy and his published works to ascertain the inner-workings of the advertising business. Ogilvy released two titles that stand the test of time: “Confessions of an Advertising Man” (1963), over one million copies in print and often a requirement for academic courses on advertising; and “Ogilvy on Advertising,” (1983). This is a short compendium of his insights into the matter of success in the business of advertising, and beyond.
“Don’t bunt. Aim out of the ballpark. Aim for the company of immortals.”
“In the modern world of business, it is useless to be a creative, original thinker unless you can also sell what you create.”
“The best leaders are apt to be found among those executives who have a strong component of unorthodoxy in their characters. Instead of resisting innovation, they symbolize it - and companies cannot grow without innovation.”
“Great leaders almost always exude self-confidence. They are never petty. They pick themselves up after defeat.”
“Great leaders are always fanatically committed to their jobs. They do not suffer from the crippling need to be universally loved. They have the guts to make unpopular decisions - including the guts to fire non-performers.”
“You cannot bore people into buying your product, you can only interest them in buying it.”
“A good advertisement is one which sells the product without drawing attention to itself.”
“Nothing kills a bad product faster than good advertising.”
Ogilvy’s rules-of-the-road are as applicable to our time as they were to his; applicable not only for marketing, advertising, corporate communications, and public relations executives but also - if not more so - for entrepreneurs, C-suite executives, and board members whose responsibility it is to make the ongoing Business Case for the Enterprise to the broad spectrum of private, public, and sovereign investors.
The Day Charles Steinmetz Schooled Henry Ford
German-born American mathematician, electrical engineer, philosopher, and technological pioneer, Charles Proteus Steinmetz (1865 to 1923), considered a genius in mathematics and electronics, and known as “Forger of Thunderbolts” and “The Wizard of Schenectady,” held over 200 patents and earned worldwide recognition for his astonishing accomplishments. The Steinmetz Equivalent Circuit, Steinmetz Solids, Steinmetz’s Equation, and Steinmetz Curves are all named for him. At Union College in Schenectady, New York, he served as Chair of the Department of Electrical Engineering from 1902 to 1913 and, over the years, published 13 books and 60 articles. One of the founding fathers of electricity, Steinmetz was a true polymath whose prodigious, unrelenting output, and breakthrough technological discoveries contributed crucially to the emerging era of electricity. He was also known as a very generous man, in fact, beloved. He is one of among only 78 scientists named to The Edison Tech Center’s Engineering Hall of Fame where he is positioned in the company of luminaries as Nikola Tesla, George Westinghouse, and David Packard. His Hall of Fame citation reads: “He was a true engineer’s engineer - earning fame and success through the amazing results of his work and genius and not by flamboyant personality.”
At some point in the timeframe 1917 to 1923 when Mr. Steinmetz served as a senior advisor to General Electric Corporation, an enterprise founded in Schenectady by Thomas Edison and financiers J.P. Morgan and Anthony Drexel in 1892, at a crucial moment when Ford Motor Company engineers were desperate to fix a jumbo-sized generator at Henry Ford’s massively comprehensive River Rouge manufacturing complex (opened 1917) in Dearborn, Michigan - which included its own power plant - General Electric was asked to send over The Wizard of Schenectady to remedy the problem as soon as possible. According the Jack B. Scott, son of Ford employee, Burt Scott, who was present at the encounter, as described in his Letter to Editor of Life Magazine in 1965, upon arrival, Mr. Steinmetz rejected all assistance and asked only for a notebook, a pencil, and a cot. For two days and nights he listened to the generator and dashed-off computations furiously. On the second night, he asked for a ladder, a measuring tape, and a piece of chalk. He climbed the ladder, made meticulous measurements, and posted a chalk mark on the side of the generator. Then he descended the ladder and told Ford’s skeptical engineers to remove a plate from a side of the generator at the chalk mark and replace 16 windings from the field coil. They did as he said, and the generator proceeded to function perfectly. Subsequently, Mr. Ford received an invoice from Mr. Steinmetz on behalf of General Electric for $10,000. Ford returned the invoice to Steinmetz acknowledging his valuable contribution but - perhaps thinking the fee for time expended somewhat excessive - requested an itemized statement. Mr. Steinmetz responded to Mr. Ford’s request in the following way: “Making chalk mark on generator $1. Knowing where to make mark $9,999. Total due $10,000.” Ford paid it. Some may consider this chalk mark the beginning of management consulting as we know it. By the way, given inflation, in our time, Mr. Ford’s $10,000 fee would translate to, approximately, $140,000. Scene from a cartoon in The New Yorker magazine: Ten executives in an elegant board room are seated around an expansive conference table, one remarks: “Indeed, ladies and gentlemen, miracles happen. But they don’t come cheap.”
Requisite Characteristics of Highly Successful Entrepreneurs
Endurance. Persistence. Indefatigable tenacity. Burning curiosity. Zeal. Stamina for relentless pursuit. The will to leave no stone unturned. John Wayne as Ethan Edwards in “The Searchers.” Peter Falk as Detective Lieutenant Frank Columbo in “Columbo.” The heart to go the extra mile, pull-out all the stops, shoot-the-moon, vanquish obstacles, and capture results. Passion for grinding down walls, traversing deserts, and scaling mountains to arrive at The Truth. “Audentis Fortuna Iuvat,” that is, “Fortune favors the bold,” from Virgil’s masterpiece, the Aeneid.
Harry Gray
“If you can’t fit your idea on the backside of a business card, you don’t have an idea,” words of Harry Gray, CEO of United Technologies from 1971 to 1986. In 2009, The Wall Street Journal remembered Harry Gray as “a merger artist who resented making just one deal at a time.” In his 1970s prime deal-making days, Gray maintained a list of 50 companies he sought to acquire.
On the Supreme Importance of Avoiding Even the Appearance of a Conflict-of-Interest
When I joined the management consulting services practice of Coopers & Lybrand (now PricewaterhouseCoopers) in the mid-1970s, all partners, managers, and consultants in our mid-town New York City office were required, quarterly, to complete a form identifying all personally-held securities. Heaven help you, if, perhaps, inadvertently, you had acquired shares of a C&L client corporation anywhere in the world. The unspoken message was loud and clear: “(1) Sell conflicting investments ASAP. (2) If you own such, you are off-the-hook this one time. (3) Better not let it happen again. Also (4), by the way, just curious, how could you have been so stupid?” This procedure, indeed, was a brilliant and extremely effective business practice especially for a professional services firm, and for me still in my twenties, one of life’s great lessons. The scrupulous avoidance of even a perception of a conflict-of-interest is the minimum case scenario for all persons responsible for moral, medical, and fiduciary outcomes, especially so, for management consultants, accountants, financial advisors, politicians, physicians, bankers, judges, and attorneys.
A Timely Message from Sir Winston Churchill
“Fear is a reaction. Courage is a decision.”
The Hawthorne Effect
The Hawthorne Effect refers to a type of reactivity in which individuals modify an aspect of their behavior in response to their awareness of being observed; this is a conclusion derived from work management research conducted at Hawthorne Works Western Electric plant in Hawthorne (later renamed Cicero), Illinois between 1924 and 1932. Workers experienced a series of lighting changes in which productivity was measured to have increased with almost any change in the lighting. This turned out not to be true. Further analysis led to the conclusion that the novelty of being research subjects and associated increased attention, that is, research participation in and of itself, could lead to temporary increases in worker productivity. This interpretation is known as “The Hawthorne Effect,” a term coined in 1958 by University of North Carolina at Chapel Hill sociologist-researcher Dr. Henry A. Landsberger. Lighting is, by far, not the only factor that could impact productivity for short periods. Thus the term is used to identify any type of short-lived increase in productivity generated by intended or unintended extrinsic stimuli. Evaluation of The Hawthorne Effect continues to this present day. It has been reported in The Wall Street Journal (September 11, 2021) that Amazon engages its warehouse workforce in a Hawthorne-like real-time work measurement system, seemingly to me fatally flawed; a work measurement system which seems to pit workers into competition with one another perpetually, demonstrably leading to early burn-out. Measuring employees by a reasonable, pre-established set of standards established by observing “norm-average” workers over time, is the work management gold-standard.