Summary
Very large organizations are usually shaped by the style of leadership imposed by the CEO. Structures and cultures vary according to the person at the very top of a company. Some CEOs thrive when working in one area of the economy but then fail in others, unable to adapt. Others, typically those leading a group of companies, have found success by concentrating on company culture, granting power to those lower in the hierarchy to take meaningful decisions.
Meanwhile, other CEOs run their businesses according to harsh financial reality - Mike Ashley being a well-known example - due to highly competitive market environments.
Key Highlights
- Characterized by his uncompromising business style, Ashley seeks to reduce costs where ever possible.
- A flamboyant, risk-taking businessman, Branson has predicated the Virgin brand on his own image, frequently undertaking high-profile record attempts (such as the ill-fated effort to co-pilot the first hot air balloon to traverse the globe) to promote the brand.
- When Amazon was created in 1994 the concept of internet shopping becoming commonplace remained distant. Founder Jeff Bezos gained enormously from being an early adopter of new technology, propelling a lowly online book retailer to one of the most successful and commercially influential retailers in the world.
Scope
- Examines differing styles of leadership in large businesses
- Looks at how brand image is created
- Analyzes the role of structure on the fortunes of companies
- Assesses the difficulties of managing businesses in new markets
- Examines how company culture reflects that of the leadership
Reasons to buy
- How do leadership styles differ?
- How does company culture change according to leadership style?
- How does a hands-off style influence a company?
- Can a hand-on approach work in a group of businesses?
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Table of Contents
Overview 2
Catalyst 2
Summary 2
Mike Ashley built a retail empire through aggressive purchasing and sales 6
Sports Direct thrived on low prices and buying out struggling brands 6
Aggressive low-cost strategy pursued at expense of brand perception 7
Recent high-street purchases continue trend of buying struggling brands 8
House of Fraser takeover reveals how aggressively Ashley is happy to play his hand 9
Ashley is wasting little time in getting to work on troubled cycling retailer Evans Cycles 10
Richard Branson hands-off style built Virgin into international brand 11
Treating each brand as a stand-alone business helped to build Virgin group 11
Branson not only sells goods and services, but the Virgin name too 12
Branson has constructed a desirable brand image by employing enterprising leadership style 13
Jeff Bezos built Amazon in his own image, propelling it to global powerhouse 14
Bezos has created a business model able to expand into new revenue streams 14
Long-term perspective limits Bezos to doing what he does best 15
Management structure enables Amazon juggernaut to progress 16
Eddie Lampert has been blamed for decline of Sears through poor leadership 17
Hedge fund management style failed at Sears, continuing a trend of retail failures 17
Centralized style of Lampert caused problems at ESL Investments but also allowed it to thrive 18
AutoNation and AutoZone were transformed in value when ESL Investments became major shareholders20
Conclusions 21
Mike Ashley has become a major retail player thanks to ability to find value where rivals struggle 21
Culture instigated by Richard Branson at Virgin allows the group to maintain its core identity 21
Jeff Bezos style of leadership allowed Amazon to become a global business superstar 21
An intense style of leadership helped Eddie Lampert succeed in hedge funds, but the same approach failed in retail 21
Appendix 22
Sources 22
Further Reading 22
Ask the analyst 23
About MarketLine 23
Disclaimer 23
List of Figures
Figure 1: Sports Direct revenue 2009 to 2018 (£bn) 6
Figure 2: Sports Direct protest, 2016 7
Figure 3: Debenhams plc net income, 2010 to 2017 (£m) 8
Figure 4: House of Fraser store 9
Figure 5: Virgin Group 11
Figure 6: Virgin Media 12
Figure 7: Virgin Atlantic Challenger II 13
Figure 8: Amazon revenues 2009-2017 ($bn) 14
Figure 9: Jeff Bezos 15
Figure 10: Sears Holdings Corporation revenue 2005 to 2017 ($bn) 17
Figure 11: Eddie Lampert 18
Figure 12: AutoZone 19
