Fred Hassan is a soft-spoken man who exudes the manners of a well-born gentleman; polite, confident and restrained. In this era of publicity-seeing CEOs he stands out for not standing out.
But on Wall Street, he’s a rock star.
Hassan is a master of change and widely regarded for his ability to turn around struggling companies. His record is impressive: six companies on three continents.
His secret? The 67-year old told "Off the Cuff" that, in part, it begins with employees: “My secret sauce… is to get the people to buy into the dream. Get them to be aligned around this common dream, and get them to put a lot of their own passion into the execution.”
Hassan relishes a challenge, but before jumping in, he asks himself one question: “Is there an opportunity for me to add value here? If I can make a difference, I'll take that job,” he said.
“Generally, when I've looked at companies, they were companies that were in trouble. And there were some big difficulties,” he said. “Usually, it was a broken culture, and sometimes there were immediate financial pressures. “
One of those companies that was facing immediate financial pressure was Schering-Plough. In 2003, the company was in desperate need of new direction. It had been burning up cash, its sales were in a steady decline, its shares were falling, and federal regulators were investigating the pharmaceutical giant.
After just days on the job, Hassan announced a major reorganization and then set about making both structural and symbolic changes. “Enormous sacrifices had to be made,” he said. “We froze the salaries, we gave up bonuses for everybody, and I gave up my own bonus. We reduced the number of corporate aircraft from four to two. We got rid of the executive dining room. And I personally showed up (in the company cafeteria) with my tray, out there on the line, taking my food. People had never seen that before.”
After six years on the job, he oversaw the company’s merger with Merck for $41 billion, the sixth largest pharmaceutical deal ever.
That was not his only big deal. In 2000, Hassan engineered the $37 billion takeover of Monsanto by Pharmacia & Upjohn, which formed Pharmacia Corp. In 2003, as CEO, he oversaw the purchase of Pharmacia by Pfizer for $60 billion in stock.
Hassan, the former chairman of Avon and the now chairman for Bausch & Lomb, said that change begins with leadership. “It comes from role modeling the mission, all the way down to the front lines. It means picking senior people who will follow through and cascade your beliefs … and it really means staying the course, and making some tough decisions along the way, including firing a few people, if necessary, just so that people will come together and move in a very purposeful manner. It takes time, but the journey can be a lot of fun.”
Hassan knows that not every employee will buy into his vision. “There are two kinds of resistance. There is…obvious resistance, which is skepticism, because people have heard about initiatives before from other CEOs. The second kind of resistance is the harder one to deal with, and the harder one to find, and that's what I call passive aggressive resistance. The first resistance, you can deal with through dialogue, and discussion. The passive resisters tell you they're with you, but they're not really with you. They smile, they cheer, but they're not really with you. Ultimately, if they're not found and weeded out, they can become very toxic to the new culture you're trying to create.”
In his new book, “Reinvent: A Leader's Playbook for Serial Success,” Hassan explains how he was able to turn around struggling companies and offers advice to other business executives about how to change the culture, attitude and behaviors of their organizations. He hopes the book will be an inspiration for non-executives as well.
“You have to get outside your comfort zone in order to expand, to grow, and to do meaningful things,” he said. “We are at our best when we are in a change mode.”
Born in Pakistan in 1945, his father was the country's first ambassador to India and his mother was a women's-rights advocate (no easy role in an Islamic country). From them he learned about diplomacy, bridging cultures, fighting for what’s right and how to overcome adversities. As a child he had a serious stutter, something he now calls a ‘challenge’ but adds, defeating it was a major lesson in life – tenacity.
That lesson has served him well from the time he began his career in 1970 as a sales rep to becoming a highly-regarded top executive at three pharma giants, but he remains humbled by the accolades he has received.
“I'm an unusual leader,” he said. “I will leave it up to whoever wants to judge me, to see whether I'm good or great, but I am a very unusual leader.”
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