By Ty Francis, Executive Vice President at the Ethisphere Insitute.
Every business is looking for the edge that will help them outperform the competition, or trying to find the panacea for its performance woes. Today, that edge comes from driving an ethical culture across the organization. It’s something that all top-performing boards will need to address throughout the year.
A number of high-profile troubles at major companies in recent months have highlighted what happens to a company as a result of a skewed culture. The scandal that came from Volkswagen’s emissions reporting fraud led to numerous investigations on how a bad culture leads to outright cheating at the company. At VW, these perceptions trickled down from the top, across the organization. With better board oversight, this culture likely could have been discovered and nipped in the bud before it became the scandal it is today.
It’s worth noting that having an ethical culture is not just about risk mitigation, it also gives companies an edge. In fact, Ethisphere has found that share price of the publicly traded companies recognized as the 2016 World’s Most Ethical Companies consistently outperform other major indices, including performing 3.3% higher than the S&P 500 last year, and even greater outperformance as compared to the MSCI ACWI. Similarly, other research has found that portfolio managers today actively review a company’s governance practices when deciding whether or not to invest. Rivel Research for example has found that CSR is cited as an important investment driver by 22% of portfolio managers, a number that has steadily increased for the past few years. None of this can happen without clear leadership and engagement from the board and the rest of the executive committee. The message is clear: Boards must get involved in strengthening their companies’ culture if they want to stay ahead of the game.
In Conversation with Craig Kreeger, CEO of Virgin Atlantic Airways
Interview by: Ty Francis, Executive Vice President & Group Publisher, Ethisphere
Since its inception, Virgin Atlantic has succeeded in establishing a customer-centric culture built around continually driving new ways to provide industry-leading service. Ethisphere’s Ty Francis caught up with Virgin Atlantic CEO Craig Kreeger recently to discuss the airline’s strategy, how it’s working to maintain its strong position, and what new directions they may take going forward.
Ty: How does the corporate culture at Virgin Atlantic support the airline’s efforts to serve customers with integrity and provide top-notch service?
CK: The relationship between our brand and our customers is really the relationship between our people and our customers. We encourage our people (through our hiring, training, and practices) to be themselves at work and to have fun. The human connection that comes from that creates a great relationship and has come to define what we refer to as ‘uniquely’ Virgin Atlantic.We listen to our customers, genuinely seeking to make their experience great. In the end, we always want to be at our best to represent our brand and build genuine relationships with our customers so that they have a positive experience flying with us.
Ty: What sets you apart from competitors with respect to your service offerings and value proposition?
CK: We exist to create a better experience in air travel for our customers. We began by resolving a need for the customer, with a mindset established by Richard to make the journey as enjoyable as the destination. This mindset runs through the company today by putting the customer at the heart of everything we do. We constantly look at pioneering new ways to improve their experience—from the moment they step into our clubhouses to prepare for their journey, to the point at which they step off a flight.We also listen to our customers and try to be a step ahead by addressing their needs even before they realize they have them. For example, we were the first airline to feature an on-board bar and the first to introduce seatback entertainment. However, we don’t innovate just to compete with other carriers. We innovate for our customers to improve their experience.
Ty: How does today’s consumer differ from the one of yesteryear, and how are you keeping pace with their evolving needs?
CK: We see that many of our customers have an entrepreneurial spirit—they chase life and opportunities. They’re always on the go and therefore always like to be connected. They enjoy more high-touch experiences and appreciate when brands go out of their way to accommodate their busy schedules.That’s why we’ve created a mandate to deliver WiFi across our entire fleet. That’s also why we’ve created unique environments in our clubhouses (with spas and fine dining options) and on our aircrafts (with a bar in Upper Class and tons of on-board entertainment options) so that customers can freely choose how they spend their time prepping for meetings, networking or relaxing.
Ty: What new services and innovations can your customers expect to see going forward?
CK: At Virgin Atlantic, we’re focused on what has always made us successful: our service and our experience. Similar to other Virgin brands, we decided from the onset that we would shake things up and inject some style into aviation. For us, it’s not about getting into the ‘amenities arm race’ like other airlines. We won’t settle for the norm, and therefore we will always be at the forefront of innovation.More recently, we announced that in addition to investing in our fleet, including our new Boeing 787s, we will be investing £300 million into our customer experience by 2018. This investment includes both on-the-ground and in-the-air experiences such as the opening of our brand new Clubhouse at LAX, the new Wander Wall for our Premium Economy passengers (to encourage socializing with our cabin crew and other passengers) and enhancements to our food and wine service. We’re constantly looking into emerging technologies such as wearables, to make our customer experience more enjoyable.
Ty: After almost 30 years in the airline industry, what have you learned about the consumer mindset and the elements of success?
CK: I’ve seen a lot in my 30 years in the business, but what I’ve learned is that consumer demands will continually evolve based on culture, society, and technology. We’re in a 24/7 world where businesses are more global than ever before. The world is getting smaller and there’s added pressure to be always on.As a result, the airline business is more valuable than ever before in helping to broker connections, drive networking opportunities, and advance business relationships. It is our responsibility to be a step ahead in order to provide the best experience to customers—from WiFi across our entire fleet, to a choice of channels on our on-board entertainment systems—so that they can be as efficient and relaxed as possible. What hasn’t changed is that people want to enjoy the journey as much as the destination.
Ty: What do you enjoy most about this job and what is your vision for the future?
CK: I love my job—when I got the job, two friends sent me exactly the same text message: to say that I had the coolest job in the industry! It’s a relaxed environment where we let our people come to work and be themselves.What I really do enjoy the most are the people. The enthusiasm and spirit of our employees and our customers for our brand is what motivates me every single day. They believe in what we do and have fun doing it. Their friendliness and care for the brand and how it’s perceived comes across in the way they interact with customers, on the ground and in the sky. I truly believe this is why customers fly with us time and time again and this is why I love coming to work every day.
Expert Biography:Craig Kreeger joined Virgin Atlantic as Chief Executive in February 2013, taking the reigns of Sir Richard Branson’s airline after a 27-year career at American Airlines (AA). Born in 1959, the native Californian grew up in Sacramento. He studied Economics at the University of California, San Diego and graduated from UCLA with an MBA in 1985.
Main article: http://insights.ethisphere.com/a-non-stop-journey/
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Advisory Board Member - Women in the Boardroom (WIB)
WIB is committed to translating the intellect, skills and expertise of their members into inaugural or additional powerful corporate director roles. It ensures its members have a board portfolio that highlights their skill set for board positioning, and teaching them how to network their way to a corporate board seat and how to maintain strong and connected relationships with boards through WIB’s virtual platform. Senior-level executive women are encouraged to join as a member of WIB to accelerate their path into the corporate boardroom.
On Tuesday, February 7, 2017, Ethisphere hosted a half-day Forum at the Nasdaq MarketSite, in Times Square, New York City, to connect leaders and present interactive discussions on benefits and best practices in gender diversity. Gender diversity is a business critical and well-established best practice in maintaining a strong board and governance system within a global company. To that end, I created a special initiative in 2016 and 2017 highlighting best practices in gender diversity and sharing lessons from the companies demonstrating excellence in cultivating gender diversity in the boardroom. The goal of this initiative is to highlight thought leadership, key metrics & data and global trends in gender diversity, ensuring that resources are available to inspire companies to take action and expand their own gender diversity governance programs. Before the event, I rang the NASDAQ Opening Bell in honor of the Gender Diversity Forum
HRH The Duke of York founded Pitch@Palace in 2014 to provide a platform to amplify and accelerate the work of Entrepreneurs. Pitch@Palace gives Entrepreneurs the opportunity to meet the people who can help make their business dreams become a reality. Pitch@Palace guides, helps and connects Entrepreneurs and early-stage businesses with potential supporters, including CEOs, Influencers, Angels, Mentors and Business Partners. The aim is to:
Create introductions to Mentors and Advisors; Through our Audiences, provide access to Distribution Systems and Supply Chains; Make Connections; and Help with Investment
It costs nothing for Entrepreneurs to apply. 42 Entrepreneurs are selected for each event and, following participation, remain within the Pitch@Palace constellation for future support and development. Alumni Entrepreneurs continue to receive ongoing support, introductions and connections to the Pitch@Palace UK and Global network.
In 1992 in my first year in college, I founded the East Park Karate Kai (Southampton Institute Karate Club) at Southampton Institute (now Solent University) which offered training in Wado Ryu and Shotokan Karate and affiliated with the British University Sports Association (BUSA), a UK organization dedicated to encourage the growth and development of sports in higher education in Great Britain.
The club was home to over 40 students from 8th Kyu to Black Belt from 1992 to 1998. The East Park Karate Kai, representing Southampton won the silver team medal at the 1995 BUSA National Championships. A 30 year veteran of Wado Ryu Karate, I hold a first degree black belt and trained under British All Styles Karate Association's Greg Wallace 8th Dan, Higashi Karate’s Sensei Barbara Mumberson 6th Dan, Chief Instructor Peter Spanton 8th Dan and the late Keith Mumberson, 5th Dan.
Transatlantic Pond Hopper
Outside of pondhopping across the Atlantic more than 200 times, I've been very lucky to have traveled across the globe and experienced people and cultures in over fifty countries including Australia, Austria, Barbados, Belgium, Bermuda, Brazil, Bulgaria, Cambodia, Canada, Columbia, Cyprus, Czech Republic, Denmark, Dominican Republic, Egypt, England, Finland, France, Germany, Gibraltar, Greece, Haiti, Holland, Hong Kong, Hungary, Iceland, India, Ireland, Italy, Jamaica, Japan, Jersey, Jordan, Luxembourg, Macau, Malaysia, Mexico, Monaco, Montenegro, North Korea (JSA/DMZ), Norway, Poland, Portugal, Russia, Scotland, Singapore, South Korea, Spain, St Lucia, Sweden, Switzerland, Thailand, Turkey, UAE, USA, Yugoslavia.
Visited seven World Wonders, and have been privileged to have lived in the UK, France and currently New York. Curenty hold dual nationality for the UK and USA.