As part of Management Today's annual Britain's Most Admired Companies survey, we asked the country's top bosses to name their most admired leader. The joint top stop goes to Carolyn McCall, who has headed ITV since January 2018, and Emma Walmsley, who leads pharma giant GSK.
Chief executive, GSK
When Emma Walmsley took over the top job at GSK in April 2017, she was not only the first woman to run the company but the first woman to take charge of any major pharma firm.
Her appointment as leader of Britain’s largest drugmaker – and the fifth largest in the world – broke the mould in other ways too. After 17 years at L’Oréal and several more running GSK’s consumer healthcare business, Walmsley wasn’t a traditional pharma specialist but a consumer marketer more used to selling Horlicks and toothpaste than lifesaving medicines.
GSK’s shares dipped on the news, perhaps reflecting surprise and uncertainty in the markets. Would she have what it takes to perform one of the most complex and high-stakes – not to mention socially vital – roles that UK plc has to offer?
Eighteen months on and she has proved her critics wrong, having set about the task of streamlining GSK’s £80bn business with the levels of energy and laser-beam focus you’d expect from a noted yoga aficionado.
"GSK has a long track record of making a great difference to patients with our respiratory and HIV medicines. We are world leaders in vaccines and consumer healthcare, but I’ve made it our number one priority to strengthen our pipeline of new medicines further," she says.
So alongside the company’s HIV medicines, new shingles vaccine Shingrix and established asthma treatment Advair, Walmsley wants to speed up commercialisation of the latest immunological research, which harnesses the body’s own defences to treat diseases. She also took a $300m punt on acquiring DNA testing start-up 23andMe, which will give GSK access to vast quantities of genetic information, the key to personalised medicine. "We believe the approach has huge potential, but we do need to challenge ourselves," she says.
Walmsley has a reputation as a no-nonsense leader who deals promptly with any failure to live up to expectations. One former colleague has described her as "nice, but utterly ruthless". She summarises her own style slightly differently: "I’m very driven. I’m curious, I get lots of energy from expanding my knowledge and I’m results- and people-oriented."
GSK is a major player in the UK, employing 17,000 and spending around a quarter of its £4bn plus annual R&D budget here, some 26 per cent of the country’s total pharma research investment. How does she view the prospect of post-Brexit life? "We have to look forward with ambition for the future of the UK outside the EU. It’s obviously a period of uncertainty, but we will work through it so that our country can continue to be competitive."
Key to that competitiveness, for GSK at least, is the pipeline of new drugs. Walmsley is committed to making GSK’s R&D even more productive – a drive that will call for some "tough portfolio decisions", she says. In October she announced the termination of five underperforming early research projects to focus on more promising endeavours.
But Walmsley is under no illusions of a quick fix. The pharma industry operates on extended capital cycles, with novel treatments taking years and costing hundreds of millions to get to market. "This will not just be for 2019. We are a long-term industry and this will be a multi-year task."
Her biggest move to date has been the decision to pull out of the running for Pfizer’s consumer healthcare business, to the relief of investors who feared the $20bn asking price was too much. Instead she opted for a lower cost, lower risk alternative, buying out GSK’s existing consumer JV partner Novartis for a mere $13bn instead. GSK will sell its Horlicks division to part-fund the purchase.
The smartly executed deal means that GSK takes control of brands including Sensodyne, Nicotinell and Panadol. It also puts an end to speculation – for now – that the firm might hive off the consumer business which, of course, she used to run.
Walmsley’s combination of strategic clarity and tactical flexibility is in part the product of her experience working in Asia for L’Oréal. "I have been lucky enough to spend time in China. The progress of Tencent and Alibaba and the integrated enterprises they have built is impressive. One of the things I most admire about how the Chinese approach business is their long-term perspective."
It’s an indication of the high standards to which Walmsley holds herself and her business that she would benchmark against the likes of Asia’s highest growth companies. "Financial performance and effective management can make a ‘good’ company, but to be truly world-class I think you need more than that. The real difference comes down to having a clear purpose which you stick to unwaveringly and which defines your actions and values. For us it is simple – we exist to help people do more, feel better and live longer."
On her desk, Walmsley has quotes from both Steve Jobs and Winston Churchill, because they both showed courage and commitment to their principles. But her biggest influence has been closer to home.
"Most of all I’ve been influenced by my Dad. His career was largely spent in the military, and although business is different I still believe simply in hard work and disciplined execution, and that principles and a sense of duty are important." J
Chief executive, ITV
Having vacated the pilot’s seat at budget airline easyJet at the end of 2017, Carolyn McCall is now chief executive of the UK’s largest commercial broadcaster, ITV, and firmly established as one of the country’s most sought-after bosses.
It’s been quite a change – for one thing she has swapped the airline’s famously no frills runway-side HQ at Luton Airport for the terracotta splendour of the old Prudential Assurance building on Holborn in central London.
Despite the obvious differences between the two organisations, from a leadership point of view the role of chief executive is very much the same, she says.
"The people side, the board, shareholders, strategy – it’s all the same. As chief executive you’re still responsible for all the risk; it’s just a different kind of risk."
It helps that she cut her teeth in media, rising from ad sales to CEO at the Guardian Media Group in the noughties – so she knows the business and many of the people in it.
She also knows how to make the most of being the newbie, using the first six months in a role not only to get under the skin of the business but also to challenge the status quo.
"There is something incredibly valuable in having a fresh perspective. You get the opportunity to ask a lot of questions about why you do things in a certain way. The first few months are invaluable for really identifying what change has to take place."
ITV – like easyJet – is a business facing more than its fair share of big challenges, from pressure on the traditional advertising revenue model and changing consumer behaviour, to the rise of deep-pocketed and fast-growing streaming media rivals Netflix, Amazon Prime and YouTube.
It’s important to keep an eye on the competition, but not to be distracted or intimidated in the process, she says. "Don’t try to be like them, just do what you do really well. YouTube or Netflix can’t be us and we can’t be YouTube or Netflix.
"As a leader you have to give clarity where you can, but you also have to absorb uncertainty for your people. You don’t want them distracted, you want them to be doing their best work. I think that’s something that’s especially pertinent in a creative organisation."
Alive to the potential of greater collaboration in the industry, McCall has been instrumental in leading negotiations with the BBC and Channel Four among others to establish a joint streaming platform to showcase the best of British TV – whether that be dramas like A Very English Scandal, long-running soaps like Coronation Street or reality shows like ITV’s summer smash Love Island.
And although those negotiations have yet to bear definitive fruit, it’s an idea whose time has come, she says. "The public service broadcasters are keen, the noise out of government and Ofcom is supportive. The environment is right. Philosophically we are very united, it’s just about how you make things happen."
A joint platform would also present a united front against Netflix et al, but she says that the nature of their rivalry is not as obvious as it can seem.
"I don’t see them as a common enemy. We compete with them at one level, but it’s for time not for viewing. Reed Hastings [co-founder of Netflix] has said that he competes with sleep. And he’s right. So it’s more intensely competitive because people only have a finite amount of time. But if we produce amazing stuff, people will come."
Her vision for ITV is based around its ‘More than TV’ strapline, intended to reflect not only the diversity of ITV as it is today, but also to make room for new developments in the future, like subscription TV, the new ITV Hub with its personalisation technology, and live events or merchandising based on TV shows. Quiz favourite The Chase is even available on an app.
"We’re in a great position to do that, because we have fans," she says. "Our big programme brands attract people who are really passionate about the programme, and want to participate."
ITV also has a key commercial advantage that the big streamers don’t, she says: its production operation ITV Studios, for whom Netflix and Amazon – not to mention the BBC and Sky – are sources of business rather than rivals.
"If you are an integrated producer/broadcaster you have significant competitive advantage. ITV Studios know there is a funnel of work that is always coming their way. They have to compete hard, but that bedrock makes them a very good, robust business," she says, pointing out that the BBC’s Bodyguard, which attracted a whopping 10.4 million viewers for its finale, was filmed at the ITV Studios in west Ealing.
For all their similarities, one difference between ITV and easyJet – at least when she joined the airline – is the number and strength of senior women. "Look at Siobhan Greene, the head of entertainment commissioning, Polly Hill, head of drama, Emma Gormley, head of daytime – we’ve got some amazingly powerful senior women here."
But McCall – who has won the title of Most Admired Leader three times, and is also the only person in the 28-year history of Britain’s Most Admired Companies to have won the award for two different roles – won’t be resting on her laurels. "One thing we do still need to focus on is the pipeline of senior leaders to the management board, which isn’t quite so clear. That’s a long-term process." Q
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James Dyson, Dyson
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Alison Brittain, Whitbread
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Image credit: Andrew Shaylor