Skip to main content

"Fred the Shred" under the weather?

THEY CALL HIM "FRED THE SHRED...". If you count "few good men" who took the lead in the "rationalisation" of workforce in the conservative European banking and Financial services, Fred has to be in the front row.

Sir Frederick Anderson Goodwin, remained in the news in Europe, mainly Britain, for his often visionary yet unorthodox methods of running Britain's second largest Banking group. After he assumed control, the RBS groups, perhaps for the first time, saw a rather American-styled cost-cutting, or Shredding as the Britons prefer to call it.

Managing nearly 1000 people worldwide at the age of 32, the acumen more than the aggression made Fred the CEO of the Clydesdale Bank at the age of 36. He has been quoted as famously saying, "I have no time for cynics, spectators or dead wood". And as we speak, being with the RBS group, he is the longest serving CEO in the FTSE-100 index. (That precisely makes me wonder if the pool underneath is in a pull-down mode...)

Knighted at the age of 46 for his services in Banking in 2004, the RBS group saw its highest ever rapid inorganic growth since Fred was brought in by another Scot and the then Chairman of RBS Group, Sir George Mathewson. Whilst being at a couple of bids of hostile acquisitions, he has been quoted saying, "There may be some possible mercy killings".

Chosen as the "Businessman of the Year - 2002" by Forbes, Fred began with the humongous acquisition of NatWest in 2000 with unusual amount of due diligence of nearly 500 man-days, and the latest is acquiring of ABN AMRO for about Euro 70bn by the consortium let by RBS Group. All in all, in last nine years that Fred has been with the BRS group, their 'shopping list' lists 26 buy-outs at the value of GBP 33bn (about USD 66bn).

[Above: (L-to-R) Maurice Lippens, Executive Chairman of Fortis, Jean-Paul Votron, CEO of Fortis, Fred Goodwin, CEO of Royal Bank of Scotland (RBS), and Emilio Botin, Chairman of Spanish banking group Santander Central Hispano (SCH) in Edinburgh, Scotland, 10 August 2007, at the time of acquisition of ABN AMRO by the BRS-led consortium.]

"I have no time for cynics, spectators or dead wood..."
It is that time in the turning wheels of world economy that the Citigroup reports a loss of USD 5.1 bn, and the chairman of UBS already fallen on his own sward, Fred is equally under fire for (yet undisclosed) rights issue coming from RBS for nearly GBP 9bn.

It is perfectly all right, I suppose, that there are other, younger, aspiring 'leaders' waiting in the wings to take command, the aegis of Fred and the likes has to be honoured nonetheless; for what it is - the aegis; though you may also count those rather "dodgy deals" that Fred supported for the sake of "business" at "huge" environmental costs in the Oil & Gas sector... (See also: The Green wall of China)

Update: Fred took an early retirement in October 2008, following the financial disaster, largely through AMRO deal. Later RBS reported a loss of GBP 24bn, and was subsequently Nationalised by the UK government. In Feb 2009, taxpayer ownership of RBS was between 75% to 95%.


Popular posts from this blog

Clay Christensen: How Will You Measure Your Life?

A tribute to Clayton Christensen, the Harvard professor who  introduced "disruption" in his 1997 book  The Innovator's Dilemma , which, in turn, led  The Economist  to term him "the most influential management thinker of his time."  Even more influential  for some would be his 2012 co-authored book How Will You Measure Your Life? . [try here ]. Christensen  passed away in Boston on Jan 23, 2020.

The Pygmalion vs. The Golem Effect

There are two kinds of self-fulfilling prophecies. They are broadly defined by wiki as follows: The Pygmalion effect , or Rosenthal effect, is the phenomenon in which the greater the expectation placed upon people, the better they perform. On the other hand is the Golem effect , in which low expectations lead to a decrease in performance. In ancient Greek mythology, Pygmalion fell in love with one of his sculptures, which then came to life. The theme was in the main stray of many English literary works during the victorian era. One of which is George Bernard Shaw's play titled "Pygmalion" from which Rosenthal effect gets its name. In Shaw's play, the protagonist, a professor of phonetics Henry Higgins makes a bet that he can train a bedraggled Cockney flower girl, Eliza Doolittle, to pass for a duchess at an ambassador's garden party by teaching her to assume a veneer of gentility, the most important element of which, he believes, is impeccable speech. (The pl

Change, Catch Words of Consulting II

Continuing from the previous post , following are a few more Catch Words of Consulting: Q x A = E : Q uality of Solution x A cceptance = E ffectiveness of Change. Q is good most of the time. The Key differentiator is Acceptance and Adaptability for a successful Change management. Passive Resistance: is nodding the head, but not actually going to participate in change; civil disobedience of a personal kind; dragging the feet with a smile. Planning vs Plans: D. Eisenhower once said, "In preparing for battle I have always found that plans are useless, but planning is indispensable." Planing is so important that PMBOK devotes the largest of its five process groups entirely on planning. See also: Related post: Change, and Catch Words of Consulting I