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Mailbag — More On Leadership

Jim Prevor’s Perishable Pundit, August 25, 2006

A lot of people wrote to say that while they thought young people were doing incredible things in the business, not so much was being done in terms of industry and, more specifically, association leadership.

The issue is if any industry trade association is well served by some of the “leaders” that have risen to high office. I think the answer is no, and it is because they often don’t live and breath produce like the people your letter writer mentioned: Spezzano, DiPiazza, Eldredge, but also people like Grant Hunt, Tim York and Bruce Peterson as well as many others do.

For too many of these people, association leadership was or is just one more thing to do. Have you noticed at the very highest levels there are people who finish their terms in office and they virtually disappear from the industry?

In some cases, their companies actually drop membership or stop exhibiting at the trade shows that, only a year or two before, they were giving earnest speeches about the absolute need to support.

That the chairman and other high-position holders of PMA, United and any industry organization will vary some in quality and commitment isn’t really that shocking. After all, isn’t the same true of corporate CEOs, Presidents of the United States, and the guys who coach little league?

But to some extent, what these letter writers are speaking to is a disagreement about the kinds of companies that should have leadership roles in the industry. PMA, for example, has from time to time allowed a foodservice operator — people like Joe Brennan of Marriott, Jim Ratliff of Hilton and PMA’s current chairman, Janet Erickson of Del Taco — to serve as Chairman.

Now if an important criteria for being chairman of a produce association is that the employer of the person be deeply committed to the produce trade and to the association, none of these foodservice people really would qualify. Produce is just one thing that foodservice operators purchase.

I assume that hotel operators spend a lot of money on mattresses, and indeed there is big competition to attract people to hotels based on the bed. There might even be some individual at a hotel company who has really gotten involved in working to improve mattresses, yet I think it is ridiculous to even ask the question: Is Hilton deeply committed to the mattress industry or to the American Mattress Marketing Association?

Of course not. Hilton is a hotel company, not a mattress company, nor a produce company. And the vertical integration that works well with supermarkets, precisely because supermarkets have dedicated produce staff, is more difficult to pull off with foodservice operators that do not.

Remember the specialized skills and contacts of a produce executive at retail create a high likelihood that this person’s next job will still involve the produce industry. No such dynamic exists among foodservice operators. A food and beverage executive at Hilton is as likely to find her next job in the wine business as the produce business.

None of this would be a shock to the PMA executives or its board. It is more accurate to say that there is a trade-off. On the one hand, foodservice operators are an enormously important client of the produce industry and an enormously important source of ideas for produce retailers. We need them in our councils as we try to address industry issues.

So, to some extent, you have to pay your money and take your chances. If you use board seats, committee seats, chairmanships, etc., as part of the offer to entice individuals and companies to be involved who might not otherwise be so involved, you are going to wind up with less committed, but far broader, leadership. It is a judgment call as to whether that trade-off is worth it, but we should at least understand the issue at hand.

Still, I think the complaint is broader and goes beyond foodservice operators. Partly I think it is a societal occupational disease. Today it is not only accepted, but encouraged, for kids in high school to participate in clubs and organizations in which they have little interest for the sole purpose of burnishing a resume to get into college. Old habits die hard, and I am sure these people will grow up and continue the habit their whole lives.

But, if an association is strong, the executives and the industry leadership have to exercise discretion. Perhaps a “place holder” will by virtue of his position or company win a place on a committee or ad hoc group, but if he doesn’t walk the walk, he doesn’t have to be advanced to the main board or to the chairmanship.

The problem really comes about as a result of weak associations that so desperately need the affiliation of major companies and important people that they advance them too quickly to important leadership posts without the testing necessary to see if they are real.

But I also think the change in the make-up in the industry makes all these problems more likely. If a national board wants a certain percentage of retailers and retailers keep merging, ipso facto the association wants a larger and larger percentage of the available talent pool on its board.

It is also true that as companies get larger, they often perceive themselves to have interests which need to be defended, and they staff positions to have representatives on industry boards. What do you think the job of a VP of Industry Relations actually is? When those regional retailers of the past did this service on boards, it was on their own time — they still had a full time job.

In a sense, the unwillingness of companies to staff and pay for board involvement assured that the participants would be highly motivated. If you get to the point where your board is filled with people doing their job, you will get people of wildly varying motivations.

And I even think the growth of national companies and the rise in the mobility of society has changed the dynamics. Whatever Bob DiPiazza’s motivations were when he first got involved in PMA, I have no doubt that he would have had me committed if I explained to Bob that he would go through all these boards and chairs at PMA and burnish his credentials so he could move to Bentonville, Arkansas, and work at the largest food retailer the planet has ever known

Yet, that exact motivation strikes me as a reasonable reason for a young produce exec at a regional chain to get involved in association leadership today. As all of us in business know, if you change the incentives, you change the behavior.

I’m still a little skeptical that if you take a given 10-year period and compare it to another, you actually can clearly demonstrate that leadership has declined. But there are trends not favoring good association leadership.

So when people are recommended for boards, task forces and leadership positions, the staff at PMA and the existing industry leaders have to be rigorous in making sure that the people proposed for leadership have both a willingness to work on behalf of the whole trade, as opposed to solely protect a corporate interest, and that their company is committed to both remain involved and to support its employees in leadership.

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