A CEO’s Survival Guide

• Leadership
• November 20, 2018
• by Merrie Spaeth

The Wall Street Journal just savaged GE’s new CEO, Larry Culp. Many of their criticisms are unfair but reporter John Stoll’s column provides an excellent coaching tool for communication staff. Culp went on CNBC, and the company stock fell 10 percent.

What did Culp say to cause this drop? Stoll wrote, “Mr. Culp said a lot but only a few things sunk in: GE’s struggling power business hasn’t hit bottom and assets would be sold to raise cash.”

Here’s our take on the interview with lessons for your top executives:

1. Television is not a chat. A 20-minute interview is like a full-length film and Culp got sound bit.

If – a big if – anyone watches the entire 20-minute interview, the viewer gets a very different and generally positive picture. Culp looked engaged and optimistic throughout the interview, and I rate his use of hand gestures as excellent.

He does have a crackly voice but that may be how he sounds. One of the other quoted experts slammed Culp’s voice as so bad that a viewer would “correctly interpret that this is a nervous man who’s bit off more than he can chew.” Wrong. Wrong. Wrong. This is probably more of a case of an expert who wanted to say something sensational enough that the WSJ would include his quote.

The same expert would have put him in a dark suit and tie. Maybe. But here’s where we get to the kind of strategic advice and preparation that clearly was missing.

2. It’s virtually impossible for the internal team, including the day-to-day external advisors, to provide objective assessment to the CEO.

This is why we frequently provide a third eye for members of the C-suite and others.

3. The first question is always, “Who’s the audience?”

Maybe it should have only been Wall Street, in which case the suit/tie combo might have worked. But Culp was also trying to reach employees and small investors or pensioners.

• His message to employees: I have a plan; if we all work together, we have options, and we can make a difference. We’re a resilient bunch who thrives on challenge….
• His message to small investors and pensioners: I met you at the annual meeting. I was impressed and touched by your concern. I heard your anger and concern and I took this challenge to make a difference in your lives.
• His message to Wall Street was supposed to be: I have a plan and I see a way forward.

I think he was trying to convey that he would always be straightforward and transparent. That approach got diffused by several factors.

Taking Control

Culp let the interviewer drive the exchange and introduce the topics. He didn’t know how to gain control, particularly at the top of the interview. He thought he was there to answer questions. One of the most important skills is learning how to get started, properly pace your topics and do so without appearing to duck questions. (Don’t learn from politicians, please.)

Memory-Driving Words

As outsiders, we also look for habits that interfere with driving memory. One of the most common is inverted speech. Culp said, “We have no higher priority than bringing leverage down,” instead of, “Our highest priority is bringing leverage down,” and, “Customers I talk to could not be more supportive,” instead of, “Customers I talk to were very supportive.”

Culp had a tendency to pick up the interviewer’s words. Most of the time this was OK, but the goal is always to have your own list of anchor “good words” prepared ahead of time. The most obvious instance was his response to the question, “Are you shivering?” Culp replied that it was cold in Boston but “I’m not shivering.” A classic mistake and the number one lesson of our BIMBO Banter blog: do not repeat negative words, even to deny them because the listener drops the denial and only hears the negative. This instance wasn’t deadly, but it didn’t help.

Hedged Speech

We also saw some hedged speech, the use of words like “sorta” or “pretty,” as in “I feel pretty good… that we’ve addressed these problems.” You either feel confident or you don’t. Direct, concise language is the goal.

Handling Tough Questions

Understanding how to acknowledge a question is another learned skill and, when used properly, eliminates the appearance of ignoring the question or confirming a negative assumption. When asked “Are you going to need new people?” he replied, “The team will continue to evolve.” He then went onto an excellent comment about the dedication and resilience of his team, but the initial impression was – go update your resume. He could have said “not necessarily,” or “it depends,” or my favorite, “let me put that in perspective.”

Culp has an instinctive understanding of how to fend off quote questions. The interview repeated criticism after criticism, frequently from unnamed sources, and Culp replied by quoting the people – the employees, customers and pensioners – that he had talked to personally. (We would go a step further and teach him the technique of acknowledging quote questions with “I’ve heard that” or “I haven’t heard that.”)

Speaking in Soundbites

Reporter Stoll delivered the final blow by comparing Culp to BP’s Tony Hayward and Bear Stearns’ Alan Schwartz. This is so unfair, but the clue to how reporters see things is that Stoll pointed to Starbucks’ Howard Schultz as a role model. The description showed that reporters value performance and soundbites. They loved that Schultz said, “I care about a good solution” and delivered it with gusto. 

It reminded me of an article by a New York Times reporter during IBM CEO Lou Gerstner’s reign. Gerstner would walk into a room and command presence, whereas the CEOs of other tech companies would come in and start spouting statistics – something Culp did. (So, they have $40 billion in cash and bank lines of credit, but only had to tap two. Two what? Two billion or two lines of credit.)

What's Next?

Culp should have started out with short, local interviews. He would benefit from a methodology that asks, “Who’s the audience?,” and from practicing how to move from answering the question to understanding how to influence what the listener hears, believes and remembers.   

Good luck, Mr. Culp. You didn’t do a good job, but you seem like a great guy.