A leader’s reputation can kill company performance – just ask Elon Musk
Polarising actions do more than capture headlines. They can translate to dramatic bottom-line impacts that take years to turn around.
We’re seeing that play out with Tesla and its sharp drop in sales and share price, thanks largely to public perception about founder Elon Musk.
Industry experts point out the sales downturn can also be attributed to more competition and buyers holding out for release of a new model.
But with such a big decline – 72 per cent in Australia in February compared with the same month last year – coupled with public protests and Tesla owners reportedly displaying anti-Musk stickers, it’s reasonable to think Musk’s reputation is the key factor.
A high-profile leader does wonders for a brand while everything is going smoothly. But when the tide of public opinion turns, a CEO in the headlines can be a huge risk or long-term liability.
We’ve seen Australian examples over the past year including Woolworths, whose then CEO infamously walked out of a TV interview and attracted negative coverage for several other incidents. Woolies then became our most distrusted brand, according to Roy Morgan research.
The former CEOs of Optus and Qantas both represent cautionary tales of leader behaviour directly impacting the company brand.
For government leaders, the impact mightn’t be a profit slump but the price will still be hefty in terms of political fortunes and loss of top employees.
A few decades ago, most of us wouldn’t have known the name of the CEO of our big brands. These days, leaders are encouraged – even pressured – to have a strong public profile in their own right.
If you’re a leader, know that people are watching, 24/7. Having a clear vision, behaving consistently in line with that vision and communicating transparently will help ensure you and your company brand continue to have a positive reputation.
