Sports Direct boss Mike Ashley hit the headlines again this week for all the wrong reasons. He is the subject of a series of allegations ranging from brash behaviour at management meetings to claims of illicit payments. These come just a year after the sportswear tycoon was criticised by a Parliamentary committee for overseeing a culture of poor working conditions at Sports Direct. Article by Ajit Menon Organisational Change Consultant – Blacklight Advisory.
Is Ashley going to ruin the firm he has built up from nothing? And, is this behaviour unique to him? In his thirty years in business, Ashley has enjoyed breath-taking commercial success. From humble beginnings as the owner of a single sports shop in Maidenhead, Ashley has gone on to establish a net worth of almost $3 billion. As a founder-CEO, he will feel a strong sense of loyalty and ownership to his organisation, something he has built over his career.
As a co-founder of small firm, I understand the feelings of ownership and pride that goes with founding and growing a business. CEOs are fiercely protective of their brand, and want to make sure that only the right people are recruited. Apple founder Steve Jobs is famously reported to have fired an employee who didn’t understand the importance of the right font, for example. Founders are steadfastly passionate about the businesses they create and the vision they have for it. As founders, they become the parents of the business and take up these parental roles both consciously and unconsciously. Just as children grow up watching their parents and learning from them, employees learn to make sense of how to act and behave by taking their cues from their leaders.
Founders can become blindsided by their vision and unaware of how their behaviour impacts the organisation. What may seem harmless like a drinking game or, in the case of one of my clients, extreme foul language can have a very big impact on employees and on the culture. The obsession with growing the business, fine tuning the products and building commercial success can be at the cost of building a strong culture, an environment where their employees can thrive and perform to help achieve the CEO’s vision.
The accounts of Ashley’s behaviour point to the Sports Direct boss’s obvious hubris, a sense of invincibility and feelings of being all powerful. Usually associated with this is the need to win and demonstrate one’s superiority over others. After all he is in his playground, his organisation and he determines the rules of engagement. This makes them blind to what the people around them are feeling and experiencing. Ashley is not so different to Uber’s ex-CEO Travis Kalanick or Jordan Belfort, famously known as the wolf of Wall Street. There is a strong expectation for others to partake in the leader’s activities and behaviour in order to remain in favour. These narratives become central to the culture of the organisation, interwoven around the founder and become a part of their legacy.
I have worked with many founder CEOs in my career. Apart from building commercial success, what I have noticed is that the best ones have focused on a few additional things:
Building organisations larger than themselves: They actively seek feedback from all levels of the organisation and their customers. They are obsessed with what it’s like to work in and with their organisations. One of my clients once said to me that it was important to him that all his employees, everyone from the CFO to the cleaning staff had a say in the direction of the organisation.
Building leadership capability: Many CEOs have also spent a large amount of time working on their own leadership capability. They have built self-awareness in order to make them more cognisant of their conscious and unconscious impact on their organisations. Another client of mine has focused his attention on developing the leaderships skills of his next level. He feels it is important that they are able to challenge him if required and will keep him honest.
Building a strong organisational culture: These leaders have also recognised the importance of culture and using it as a competitive advantage. They recognise that if they build the right environment they will attract the best talent and consumers will seek them out.
Mike Ashley obviously did many things right, despite his behaviour, to build Sports Direct from nothing to a multi-million-pound business. The question remains, however, whether the organisation will survive Ashley and still remain successful like Apple after Steve Jobs. Or, will it rot away as more and more scandals and stories emerge?