The Making of a U.S. CEO

What can business executives learn from political candidates?

October 29 2007 by Robert Lawrence Kuhn


The U.S. presidential race is entering high season, and leading candidates are jockeying for position. Since leadership is the driving quality that Americans seek in their commander-in-chief, their national CEO, we can discern leadership lessons from what these candidates do well, and sometimes more tellingly, from what they don’t do so well. Let’s review our candidates and infer general principles that business executives might apply in their own careers, particularly as they seek promotion to senior management, where leadership is properly the defining characteristic and often the deciding one.

The Democrats
Hillary Clinton: The country is dramatically divided over Hillary’s candidacy: She inspires the most passionate “positives” and elicits the most powerful “negatives.” She rides on the legacy of her husband, Bill Clinton, the most natural politician in recent memory, and she capitalizes on her eight years of on-the-job experience in the White House. She continues to hold a comfortable lead in Democratic Party polls-the nomination seems hers to lose-and so she strives to avoid missteps as she adjusts her image. Her critics, of whom there are legion, accuse her of being overly ambitious and opportunistic, shifting positions for transient expediency. Having voted for the Iraq War, she can’t quite figure out how to condemn President Bush and yet seem strong on defense. When she is criticized for not being warm and caring, she follows a nurse around for a day. Credit Hillary Clinton, however, for nuance in her Iraq analysis and for eschewing the simplistic populism of bashing Washington lobbyists.

Barack Obama: Perhaps this generation’s most electrifying new candidate, Obama combines sudden celebrity with the appeal of being a unifier and role model for America-an African-American from Hawaii (his father is a black Kenyan and his mother a white American), a graduate of Columbia University and Harvard Law School, a lawyer and a senator with superb oratorical skills. When criticized for his lack of experience, particularly in foreign policy, he fires back by suggesting that perhaps America‘s problem in Iraq has been all the so called “experience” of Dick Cheney, Donald Rumsfeld and their “experienced” team. Good judgment, Obama asserts, trumps long experience.

John Edwards: Said to possess the best smile and the best hair of all the candidates-assets not insubstantial- Edwards carries the baggage of having been John Kerry’s running mate in their 2004 election loss. A former trial lawyer specializing in personal injury and corporate negligence, he has taken a populist position verging on class warfare as he tours poverty areas and blasts big business. The further his polls dip, the more he attacks “powerful interests.” In a campaign speech, Edwards claimed, “The entire system is rigged, and it’s rigged against you. …From insurance companies to drug companies to oil companies, those people run this country now. …you’ve got to take them on and beat them. I don’t think you can sit at a table and negotiate with them. The idea that they are going to voluntarily give away their power… that will never happen.”

Edwards has been criticized for the huge fees he earned as a successful trial lawyer-and for his expensive haircuts. The diagnosis of incurable cancer his wife, Elizabeth, received was a political minefield: Playing it down might appear callous, while stressing it might feel unseemly, a garish attempt to elicit sympathy. To the Edwards’ credit, they played it straight and got it right.

Al Gore: Nobody really thinks that the man who won the popular vote in the 2000 elections has given up his desire to be president, even though this is precisely what he keeps saying. Gore is smart enough to know that he seems yesterday’s candidate and that if he were to run in the Democratic primaries he would lose. His only hope is if Hillary were to stumble and the Democratic convention were to deadlock, he could become a compromise candidate. (“How do you know when Gore is running?” goes the inside half-joke. “When he starts losing weight.”) Give Gore credit for his passionate campaign against global warming, exemplified by his hit film, An Inconvenient Truth.

The Republicans
Rudy Giuliani: It may seem astonishing that the leading Republican candidate supports gay rights, abortion rights and gun control, not to mention being married three times and having had a notoriously public affair. Giuliani is running on one issue: leadership, tough leadership. Giuliani led New York through the catastrophe of 9/11, and he takes a hard line against terrorism (particularly Islamic extremism). He is known for cleaning up New York City-reducing violence, vandalism, graffiti and public solicitation, even though at times he seemed to inflame racial tension-and thus he is credited for managing what had been previously labeled, disparagingly, an unmanageable city. Even in standing up for his liberal social views-conventionally a death wish when seeking the Republican nomination-he earns begrudging respect among some conservatives and reinforces his tough-guy, can-do image.

John McCain: Considered for years one of the most independent-minded politicians in America (a “maverick”), and surely a genuine war hero (having spent over five years in a North Vietnamese prison camp), McCain transformed his independence into a personal qualification for which Americans seemed to yearn in an era of increasingly partisan politics. Yet McCain has seen his leading position falter, largely the result of substandard fundraising and a spate of internal management conflicts. McCain’s apparent rightward shift, needed, he felt, to attain the Republican nomination, may have eroded his independent image.

Mitt Romney: Romney is arguably the most “perfect” Republican candidate-successful business executive, Massachusetts governor, ideal family man, good-looking and highly articulate). But he is a Mormon, and not all Americans are comfortable with the prospect of having their president with this religious persuasion. Romney has drifted rightward in his positions on abortion and gay rights, and he seems caught on the horns of a religious dilemma. Should he draw closer to religion by stressing that his serious religious convictions bring him closer to the Republican Bible-believing base? Or should he retreat from religion, concerned that many Christians consider Mormonism a cult, by asserting that his religion has nothing to do with his political leadership?

Fred Thompson: An actor and former senator, Thompson held back from announcing his candidacy as long as possible. His strategy was simple. He needed to know where the other candidates stood, and when McCain faltered and Giuliani seem ed vulnerable on social policy, Thompson an nounced and now seeks to take the conservative high ground. On abortion, Thompson was controversially unequivocal: “I think Roe v. Wade was a bad decision. I think it was bad law and bad medicine,” he said on CNN-a position that will surely help with the nomination but, if he should win the nomination, would just as surely hurt with the election. Folksy and charming, Thompson has a reputation for not working particularly hard. (Ronald Reagan, that other actor who had a remarkably successful presidency, faced similar accusations.)

Field of Candidates III: The Potential Independent Finally, one cannot ignore a potential independent candidate, who may flout the conventional wisdom that third-party candidates can only attract limited voters, like Ross Perot in 1992 and 1996, or would-be spoilers, like Ralph Nader in 2004.

Michael Bloomberg: Not considered particularly charismatic, lovable or good-looking, the New York City mayor would run on one issue: blunt competence. (Bloomberg jokes that national voters won’t go for “a short, Jewish billionaire from New York.”) As an entrepreneur-turned-politician, he has surprised many New Yorkers by his strength of leadership. It is not unimportant that were he to enter the campaign, he could fund, say, $500 million without much denting his accounts. Wisely, Bloomberg will monitor politics and wait until the last moment before making an irrevocable decision.

Five Leadership Principles: What to Do Stress Strengths More than Correct Weaknesses: Hillary’s legacy. Giuliani’s leadership. Obama’s freshness. Bloomberg’s competence. Romney’s family values, all-around experience. Edwards’ middle/lower class appeals. McCain’s independence. Thompson’s image.

Turn Weakness into Strength: Obama on his lack of experience. Edwards on his wife’s cancer. The more conservatives attack Hillary, the more her liberal base supports her.

Differentiate Yourself: McCain’s independence. Edwards’ populism. Thompson on abortion. Hillary as the first female candidate with a serious shot at the presidency. Giuliani on 9/11. Obama as a Harvard-educated, African-American senator.

Tell the Hard Truth: Giuliani on his non-conservative social positions. Gore on global warming. Hillary on lobbyists. Bloomberg on himself. Timing, Timing, Timing: Gore, Thompson, perhaps Bloomberg.

Two Anti-Leadership Principles: What to Avoid Inconsistency: Hillary on Iraq. Giuliani’s love life. Thompson’s image of not working hard. Obama’s lack of foreign affairs experience. Edwards’ populism conflicting with his prior career and his current lifestyle.

Expediency: Hillary’s image (whether exaggerated or justified). McCain’s rightward shift.

Application for Business Executives It may not be instantly obvious what the private selection of a business chief executive by a board of directors has in common with the public election of a political chief executive by a national vote. The commonality is leadership, the overarching, predominating trait that prevails in both cases.


Robert Lawrence Kuhn, an international investment banker and corporate strategist, is senior adviser at Citigroup. He is co-editor-in-chief of China’s Banking and Financial Markets: The Internal Report of the Chinese Government and author of the number one best-selling book in China in 2005, The Man Who Changed China: The Life and Legacy of Jiang Zemin. Dr. Kuhn’s articles describing and explaining investment banking are posted at www.chiefexecutive.net/investment.