Martin Sorrell: Persistence and determination
LONDON, England (CNN) -- CNN Financial Editor Todd Benjamin speaks to Sir Martin Sorrell, CEO of communications giant WPP Group. The following is a transcript of the interview.
Q: You've got a degree in economics from Cambridge, you have an MBA from Harvard, even when you were at Cambridge you wrote an article called management today -- what is it about business that you love so much?
A: Well my father was in business, he was in retailing, which was probably the most 24/7 -- as they would call it nowadays -- form of business. So he would spend a Sunday getting the sales figures for the week from his regional managers in the UK, because his business spanned the UK. When I was young, about 12 or 13, I'd go out with him in a car at the weekend if he was looking for new sites, or looking at existing stores. So, I think it has always been in the blood. I don't know whether you could describe it as being ethnic -- it gets a bit sort of racist when start talking about things like -- but Jewish families, especially families that have been, that have got family businesses -- although my father didn't own the business, he ran a business -- there's a sort of ethic, if you like, or an interest in talking about business in a fairly intense way.
Q: But your father was a very important person in your life wasn't he?
A: Yep I think he was not only a father but my closest friend - I don't think I've ever had a closer relationship than than - and so I think it was a mental, I mean up until his dying day, I guess in '89, I would speak to him even in the cut and thrust of what were called hostile takeovers for JWT and Ogilvy, I would be talking to him about I would guess 2, 3, 4 times a day at least. So I always used him as a sounding board for a lot of things that we did.
Q: Do you think there was anything in your childhood that made you...
A: Freudian analysis going on here!
Q: Exactly, do you think there was anything in your childhood that made you fundamentally who you are today.
A: That I don't know - I'm not clever enough to figure all that - I mean you're conditioned by your roots, your historic roots, you're conditioned by your childhood, you're conditioned by what your parents did or didn't do, you're conditioned by the closeness or lack of closeness of your family. I'm just reading a book called "Freakonomics" actually, written by a Chicago economist, really interesting book, which looks at trends in different ways and tries to get to the reasons why things change, and clearly family environment, knowledge of family, involvement with family, is critically important in the formative years and I think that does have an impact -- whether you have a happy childhood or you have an unhappy one, or whatever.
Q: But clearly you're a very driven person, when you started WPP, you had a market cap of one and a half million pounds, now you have a market cap of about seven and a half billion pounds. Where do you think this tremendous drive came from?
A: Well, I think I was a spoilt only child, in fact that's not technically true because I did have a brother who died at birth a year earlier, so I was the only egg in my mother's basket or apple in the basket, and I think I was lucky, I had a very good childhood, a good upbringing, my parents made a lot of sacrifices for me so that I could get a half way decent education and so I think I benefited from that. Obviously my father had a considerable drive he didn't work for himself, he worked as a company, in a company, in an industrial holding company which had a retail division, as chief executive. I think all those roots had an impact. From a very early age, when I was 13 or 14 I remember meeting the chairman of my father's company, the industrial holding company which owned the retail division, and him asking me what I wanted to do, and I said you know, somewhat precociously I said, "You know, I want to go into business," "Please sir, I want to go into business," a bit like The Graduate you know! And he said "Well if you want to go into business you should go to Harvard Business School." And I went up to university, I went to Cambridge, tried to do economics, fought with economics, didn't do very well at Cambridge, I got a 2:2. But those were the days when a 2:2 meant something -- with grade inflation now, a 2:2's not worth the paper it's written on! And I always wanted to go to Harvard Business School immediately after, it was in 1963 at the height of the draft, and I was a member of what the admissions dean at Harvard business school called the "most naive class" at Harvard business school, it was the youngest.
Q: How would you describe your own personality?
A: It's very difficult for me to....
Q: Let me give you some terms that people used to describe your personality...
Q: That you're driven, that you're very focused..
Q: That you're very detail orientated?
A: Yes, they've described me as being a micro-manager which I think is a compliment not an insult.
Q: They think you are so detail orientated that you can drive some people crazy sometimes?
A: I don't think. I'd veer away at that point. I wouldn't drive people crazy, I just think detail's important. I think accuracy's important.
Q: They also say you're very charming and down to earth.
A: Sometimes, when I am being interviewed by you I am -- little else!
Q: OK, we're going to move on here. What do you think your greatest strength as a manager is?
A: Again, I think that's for others. It's very difficult Todd for me to ... I mean if I was going, what do I think is important? I came across a quote by Calvin Coolidge, and I was reading an article yesterday, and it referred to the fact, I pulled out this article, this quote by Calvin Coolidge and it was about persistence. Basically it said, you know, people, intelligence, there are a lot of people who are unsuccessful who are intelligent, there are a lot of people who are successful who aren't successful who are well educated, but in his view the common quality was persistence. And I think that's very true, I mean if somebody said, what would be a motto, "KBO" -- KBO stands for "keep buggering on" -- KBO, persistence is very important. I think getting on with things is very important. I mean I don't think that these are qualities, I'm just saying to you what I think is important. I think doing things, executing quickly is important, not delaying. I always think delayers are negative. So I would say persistence, determination, I don't think that what we do in our industry is necessarily rocket science. I operate on the basis that we are averagely intelligent, or I am averagely intelligent, and therefore looking for the places where, as I said to you I just came back from a trip to China and India, our business grew in first half a year, grew by 22 percent in China and 13 percent in India, against a worldwide average of six percent. I believe you go to the places which are growing more rapidly because you have a better chance, you know, push on an open door, don't push on a closed door.
Q: What do you really love about the advertising and marketing business?
A: It's great fun, it has a quantitative element to it and a qualitative element to it, so it's left brain and right brain, can't remember which one is which, but it's left brain and right brain. It's a business for high achievers because you get very very rapid feedback. I mean you pitch a piece of business, people put out a piece of work, it's either successful or it's unsuccessful, it's constant evaluation. And going back to my human behavior and organization courses at HBS, you know, when you looked at the characteristics of high achievers, one of them, I always remember, was a desire for rapid feedback, well you get it rapidly. The other thing is there's no great hierarchies in our business. You don't have to wait for buggins's turn, or for somebody to drop dead, or depart before you, you know, the escalator is quite a quick one, it's rather like sports and entertainment. It's not an industry that's developed vices over long periods of time.
Q: And your vision of the industry going forward?
A: Oh yeah, very simply, you said to me what do I think WPP should look like in five to 10 years' time: More Asian, more Latin American, more African, more Middle Eastern, more measurable, more direct, more interactive, more Internet, more research driven, you know because clients will want to understand the implications, the quantitative implications of what they're doing, and finally more business outside advertising, classic advertising, because network television continues to get relatively more expensive and new technologies and new media become more and more important.
Q: Your firm is doing extremely well now but you were severely tested in the early '90s after you bought a major advertising firm, it happened, then the recession came, you were hard hit, you were financially, you were up against the wall, what did you learn from that experience from a business stand point, very briefly, and what did you learn about yourself in terms of dealing with the crisis.
A: Well, on the latter part, I thought, I got us into this crisis so I better get us out of it. On the former part of the question, the first part of the question I learned that structuring the deal was extremely important and I over-leveraged the company, but I think fundamentally the issue that I learned about, or the issues that I learned about, were the proper structure of the transaction and the second part of it was going back to persistence and commitment. I think the biggest tests are when you're tested I mean the only, in the 1990s all you had to do was come into the office and stand up! You know, it was easy. Ruben and Greenspan were running the world's economy, low inflation, emphasis on keeping inflation under control. The general economic conditions were very very good and as I say all you had to do was come in and stand up. But the issue that I learned about in 1989 and '90 was persistence, making sure that if you did make a mistake that you tried to dig your way out of it and not give up.
Q: Let me ask you this as an executive do you think you're tested every day?
A: Yes absolutely. I think you make good decisions and bad decisions every day. You make mistakes everyday. No, I think everyday you are. Now clearly there are bigger issues that arise. I think particularly in this new millennium when I think about what's going on in our industry and the two principle challenges -- one of which is geographic, and one of which is functional, about the change in traditional media and new media -- I think everyday we are tested - and the pace, I know it's a trite comment but the pace of change is extremely significant.
Q: I want to ask you about your time in America because you started your marketing career there, you went and got your MBA at Harvard there, how important was that American experience in terms of shaping your outlook either on life or on business?
Well I think it's phenomenally important, in my case. I had the good fortune to go away immediately after three years at Cambridge in economics, to two years at HBS in an MBA. I was particularly lucky because it was the height of the draft and they were accepting people, more people straight from school. And I got an exposure, not just an education abroad, but to people abroad, you know, I've got friends that I established there well over 30 years ago who I still see on a regular basis. So it was the opportunity to learn abroad, the opportunity to learn in America which is a very very fluid, flexible place. I always remember '66 to '68 you could call anybody in America, the CEO of any corporation, whereas in the UK you'd have to go through a phalanx of communications departments and secretaries and PAs in order to get to anybody, so America's always been much more fluid, flexible, accessible than the UK which tends to be much more structured or historically was much more structured and hierarchical, and I think America always had that. I think a lot of people have said that, or felt that. That when they went to America it was the new land, was the land of opportunity and scale. The other thing is scale. Sixty million people in the UK now, versus two hundred and eighty million in the US, which then when you think about China and India -- a billion and a half and well over a billion -- the new scale is from the east and not the west.
Q: But in 1964, you went to the States, you went to the democratic convention.
A: Right, in Atlantic City, yep.
Q: In Atlantic City, and that had a big impact on you. Why?
A: Simon Sharma, who's quite a famous historian, a very famous historian...now he and I went to eastern Europe in '63 and we went to Hungary, to Czechoslovakia and we went to east Germany and we went to Austria and then the following year we went in the other direction and we went to the convention. It was after Kennedy was assassinated, and both Simon and I were, I guess, devotees as many young people were at that time for JFK and Robert Kennedy we saw at the '64 convention, it was the Lyndon Johnson convention in Atlantic city and that had a big impact on me, because of the politics, the first hand view of politics that we saw. And to a lesser extent business, because business was involved in it. I guess it widened my horizons. We were reporting on the convention actually for the university newspaper, so we were doing a quasi-journalistic job. It opened my eyes up. I then had a very bad car accident, subsequent to the convention, in New York afterwards, I don't know if that had any psychological impact on me, I'm sure some people have suggested it might have, but I just think I got exposed to the us and the opportunities in the us. I was educated there in part. The business education I got there, was very, I think it had a big impression on me, because it was what I call a trade school, it wasn't an academic school. In fact, Harvard business school is not on, not in Harvard, it's in Boston, it's on the Boston side of the river, and a lot of people refer to the fact it's not only geographically separate to the university, but it's sort of academically separate, it's not regarded in high regard by academics, I think even to this day, it certainly wasn't in the '60s. So I ... that had a very big impact on me, I think my education in America, the people I met, the professors I was exposed to. It wasn't theoretical it was practical, it was a trade school.
Q: And you still are a great devotee of the States?
A: Yes, very much so. I think I owe the U.S. and America an awful lot because personally I think the most significant part of my education took place there. A lot of my mother's and father's family went to America, they sort of moved from eastern Europe from Russia and Poland and Romania to the UK. My mother and my father stayed but their brothers and sisters basically, almost all of them, went to the U.S., so a lot of my family, or my father's and mother's family settled there. And the opportunities they had there, I had there, in America, were very much more significant, I really believe than the opportunities I would have got if I'd stayed completely in the UK or in Europe.
Q: You were once quoted as saying: "WPP is not a matter of life or death, it's more important."
A: Yes, more important than that. Yes well that was, I copied it, it was plagiarizing bill Shankly, who's a famous, was a famous Liverpool football manager who said "Football's not a matter of life or death it's more important than that," and WPP will always be more important to me than to anybody else -- whoever succeeds me or whoever did what I'm doing, because we started it 20 years ago with two people in one room when it was worth a million pounds, wire basket manufacturer. And, this is not a job, this is fun. This is, I mean, you could call it an obsession. This is my way of life in a way. So it's my baby, I'm not a woman, so I don't know what giving birth to a child is like as a physical experience, but it's almost like giving birth to something. And so, this is not a job, I don't come in here 9 to 5 or 7 'til 7 or whatever it is. This is very much part of my life, and therefore, I'm not a manager. That doesn't mean, by the way, that being a manager's a bad thing, but you could say I'm a founder, or however you want to put it, or I initiated it or started this. That's very different, emotionally and psychologically to coming into a job, or being hired into a job, or doing a turn around on a business, you know, finding it in a bad state and making it better, or finding it in a good state and making it worse. Very different.
Q: And outside of work I know you enjoy theatre, I've seen you at the ...
A: Yeah, theatre, cinema. I like cinema a lot. I like cricket a lot.
Q: What do you like about cinema so much?
A: I enjoy watching cinema. I think cinema's a fabulous medium. I mean, maybe it's because of what we try and do here, I mean advertising is sort of mini-films, even if you do it on the Internet, in fact the Web and the Internet gives you more opportunity to produce maxi films. I mean, I think the cinema is fantastic medium. So I love the cinema, like theatre, a little bit of opera, not a great fan, a little bit of ballet, cricket, skiing.
Q: You're a big cricket fan. Why do you love cricket?
A: Well, explaining to people in America that you play a game for five days, have lunch and tea and you have no result, often! Hopefully that will happen at the Oval while we're talking.
Q: What do you want your legacy at WPP to be?
A: Well I think the unusual thing is, you initiate something, you start something, you build it and then you try and manage it. And the skills for those two functions are very different, some people can start a company and can't run it, some people can run a company and they can't start it, it's very rare that you find people who can do both, so I'd like to think that I can do both and build as a result and be responsible in part with others for building the finest company in our industry so the epitaph should read, you know "he was partly responsible" or "was responsible for initiating the growth and development of the finest advertising marketing and services company in our industry," very pretentious, but that's probably what it's about.
Q: What do you think separates a good leader from a great leader?
A: It's very very difficult to say. I mean, I just think it's about commitment. Again, I don't think it's brain surgery, I think it's about commitment. I think it's being very focused. I mean, people have analyzed great business people or successful people generally and a lot of the analysis comes back to fear of failure, right. And I guess my biggest fear is that we go back to that one room with two people that we started in 20 years ago. So I think that's probably a lot to do with it, but it's very difficult for me to say what, you know, and it depends on the industry, generalizing about these things is very dangerous. You should ask my mother what ...
Q: Do you think coming from that eastern European, Jewish background, influenced you at all?
A: Erm, yeah. I think it did. I mean in 1963 I went with Simon Sharma to Theresienstadt, which actually wasn't a death camp, it wasn't a concentration camp it was a deportation camp, outside Prague. It was the camp used by Goebbels to convince the Red Cross that there was nothing wrong going on in these camps. And I remember that made a big impact on me, you know if you're thinking about sort of seminal events -- democratic convention, JFK -- that made a big impact on me because we went to Budapest, we went to Prague at a time when understanding those things, the east was much better at that time for explaining what went on in the Second World War, particularly in relation to the six million Jews that were wiped out, than the West.
Q: You and I have talked many times and I always find you very direct and very charming and there's another side to you which is extremely intellectual ... you like to read a lot don't you?
A: I like to read a lot, I mean I like to think about what is going on and the impact of what is going on on our clients and therefore, by definition on us. I mean if we can correctly analyze what is going on economically, politically, socially and understand you know what's happening demographically, the demographic shifts, then I think we have a very fundamental understanding of what the consumer's going to do, therefore what our client's going to do, and therefore what we have to do, so a lot of people would say maybe we over-intellectualize the process -- I don't think we do, I think we think long and hard. You know, you're in the media business, what are media owners doing, how are they reacting, what are the developments in new media, are they being, are they becoming more measurable, should they be more measurable, you know, all these things. I think they're really very interesting. And you know the great thing about our business is it's sort of like investment banking and consulting -- if I look back to where we started twenty years ago and I look at our client list, you know I take our top 10 clients or our top 50 clients or whatever it is, I mean the variation in what we do and where we do it, I mean you know 24 hours ago I was in India and we were talking to the leading Indian companies, the hi-tech companies the outsourcing companies, and the companies that want to go into India and then 24 hours before that we were in China doing exactly the same thing and China clearly will be the other super power in the world in the 21st century and maybe even out-distance the existing super power -- who knows?
Q: Tell me about your father because he was extremely important to you wasn't he?
A: Yes I mean he was an extremely close friend - I think probably the closest friend I've ever had and he was somebody that I could talk to in a very open way and get a view - and I think he was a very wise man, and he was a very clever man, probably never fulfilled his potential, I think certainly he could have done much more -- he did a lot -- but much more than he did. But I would talk to him on a daily basis, maybe 3 or 4 times a day about issues in the business.
Q: And he himself was in business so do you think this is where your interest in business came?
A: Yes definitely. He was in the radio and electrics business, he ran, I guess the equivalent of Dixons in the '70's and I used to see him on a Saturday going round, visiting stores, or go with him on a Sunday to visit new sites or see him taking reports from his regional sales managers on the takings for the week or how sales were going, so I think that had a big impact.
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