‘Value’ proposition: Ex-CEO on how Chicago can woo new jobs
In light of employers moving in and out of Chicago, Harry Kraemer Jr. weighs in on what’s important to corporate leaders and how the city’s boosters can appeal to them.
Harry Kraemer Jr. occupies a world of complexity and close calls, nuances and competing interests. It’s a good thing he’s in academia and not politics.
A professor at Northwestern University’s Kellogg School of Management, Kraemer has insight into the minds of CEOs because he had that role at Baxter International from 1999 to 2004, which capped a more than 20-year career at the company. But he exudes more enthusiasm and pride about his teaching career at Kellogg, where he concentrates on value-based leadership and where students once named him professor of the year.
Imagine that — he hooked the MBA crowd with talk of nonmonetary “values.” What might those be? To Kraemer, they are rooted in character, open-mindedness and respect for others. They are not “values” as the word is often used today in a partisan, liberal-versus-conservative sense. He wrote a book about four principles of value-based leadership, which he describes as self-reflection, or the ability to assess yourself; balance, considering different perspectives; true self-confidence, being OK with who you are; and humility, never forgetting where you came from.
So what is this ex-CEO’s view of companies bounding in and out of Chicago, with headquarters exits raising doubts about the region’s economic attractiveness? What did he think about the city’s marketing agents last week asking companies to take sides in culture wars? Move your business here, was the pitch from World Business Chicago, co-signed by Mayor Lori Lightfoot, because your employees will enjoy broad abortion rights. Does that fit with how CEOs approach where to move or expand?
“I always say I have very few answers,” Kraemer said. “I have a lot of opinions.” He writes a lot. CNBC posted a piece from him citing data about cellphone use and urging people to stop touching their phones 2,617 times a day. For Fortune in 2016, he analyzed Donald Trump’s performance in a presidential debate and concluded Trump had little ability to self-reflect and calm people. Sound about right?
As to mobile companies, Kraemer said location decisions seldom are made on contentious issues such as crime or tax levels, contrary to what you’ll often hear. CEOs worth their stock options need to understand and balance multiple interests — customers, shareholders, employees, suppliers, the planet Earth. The last one is gaining importance with each generation and could distinguish a company from competitors. “I have five children,” Kraemer said. “They won’t work for a company that isn’t a good corporate citizen.”
CEOs, Kraemer said, need to have doing right in their hearts while doing what they can. Compromise isn’t a bad word here. “What is the right thing? CEOs need to pick really good people with really good values. Diversity, equity and inclusion are essential and most organizations feel strongly about that now,” he said.
What about Caterpillar, moving 230 headquarters employees from the suburbs here to Texas, where they face tighter restrictions on voting rights and abortion and where some might not feel welcome? Bosses there should have taken that into account before making the decision, Kraemer said. “A question for them is, ‘What are you going to do if the people on your team have a problem with that now?’” he said. CEOs need to learn about internal issues to, as Kraemer put it, “minimize the surprise.”
Regarding the city’s abortion pitch to companies: “Personally, I don’t favor that approach at all. Any company that responds positively must assume nearly 100% of employees are pro-choice. That’s not likely the case,” he said. Some CEOs fall into a trap of thinking that if they have strong views about an issue, their employees must as well, Kraemer said.
When companies look for new locations, they ask about the labor force, higher education, transportation systems and cost of living, Kraemer said. Chicago historically competes well on all fronts and can boast of other attributes such as growth in tech and life sciences, reliable power and lots of fresh water, the last two of which could be selling points for companies in parched sections of the U.S. where rolling blackouts are a threat. “With all that to say, you’re going to talk about abortion? Really? It’s certainly not obvious to me,” he said.
Chicago crime, the issue Ken Griffin cited in taking his Citadel headquarters to Miami, and the quality of public schools have to be tackled head-on, Kraemer said.
It goes back to those points about balance and leadership. Those of us not in MBA school and concerned about the direction of the city can learn lessons too. Yes, crime deters job growth. Yes, companies still come here. Lightfoot’s office counts 35 relocations and 58 expansions here this year. Not everybody’s pulling a Griffin. The truth, frustrating to pollyannas and prophets of doom, is that Chicago badly needs fixing, but it should be just fine.