[View web version](
BEST OF THE WEEK
And another thing...
Welcome to Best of the Week. Iâm embracing the novelty of writing this at my desk in Sydney.
In the opening scene in the brilliant, dark British comedy The Thick Of It, embattled government minister Cliff Lawton is labouring under the mistaken impression that heâs still got a job.
Spin doctor Malcolm Tucker allows him a moment of hope.
âWeâve absolutely no desire to get rid of you. I just want you to know that.â
But only a moment. Then he begins to explains the facts that the minister is the last person to realise.
âBut itâs difficult. Endless headlines day after day...â
Tucker cuts to the chase.
âIâve drafted you a letter of resignation. It gives you a chance to say youâre jumping before youâre pushed. Although weâre obviously going to be briefing that you were pushed. Sorry.â
The minister rapidly cycles through the various stages of grief for the loss of his soon-to-be-former job, with stops along the way for denial, anger and bargaining. Tuckerâs having none of it.
âIâve written some very nice things about you in the PMâs reply to your resignation. Some very nice fucking things indeed. I had a lump in my throat.â
And five minutes and 40 seconds into the first episode of the series, the minister is gone.
Sadly for NABâs chairman and CEO Ken Henry and Andrew Thorburn, Malcolm Tucker was unavailable this week. So without that tough love, it took them three reputation-shredding days to face the facts.
From Monday night, when the report of the Hayne Inquiry into the financial sector was published, until Thursday evening, the the duo continued under the misapprehension that they still had a job, long after the rest of the world understood otherwise.
Think of it as the Rear Window Rule. Once Joe Aston informs the readership of the Australian Financial Review (who are also your investors) that youâre âa smug prickâ, your time at the helm of a $70bn bank has come to an end.
Sometimes, as with extravagant-spending CPA Australia boss Alex Malley, it takes a while. But in the end, they all have to go.
And thereâs a lot for the marketing industry to take from the Hayne Inquiry - or to give the correct title, the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry - if itâs willing to look for the lessons.
Lesson 1: Adland has no real idea about its clientsâ behaviour.
Remember the multi-award winning The Break Up campaign, for NAB?
Believe it or not, The Break Up was eight years ago this coming Thursday. (Public service announcement: Have you remembered Valentineâs Day?)
Masterminded by Clemenger BBDO Melbourne, the whole thing kicked off with an apparently erroneous tweet by a NAB social media manager: âSooooo stressed out. Have to make a tough decision and I know Iâll probably hurt someoneâs feelings! Arrggghhh.â
Twitter was newer then. Most people didnât suspect a stunt. It got 100 retweets. Which was a lot in 2011.
Even Westpac replied: âHey @nab know the feeling.â That got 68 retweets.
Then the stunt was revealed, as a huge ad campaign was unleashed. NAB was âbreaking upâ with rival banks, because it said it wasnât like the others. It was going to give customers a better deal.
I loved it at the time. It set the agenda. The Daily Telegraph in Sydney put it on the front page. Tabloid current affairs shows covered it, going behind the scenes at the NAB âwar roomâ. (Iâve no idea if it was the same NAB âwar roomâ the bank was later so proud of during the Hayne Inquiry.)
Customers, persuaded that NAB was indeed different, switched banks. According to NAB at the time, the campaign drove a 79% increase in home loan enquiries, a 50% increase in credit card applications, and a 20% increase in transaction account openings. The bank said it brought in 175,000 new customers.
It went on to win the PR Grand Prix at the Cannes Lions. [The awards case study video]( is still worth a watch now - albeit with a different feeling, knowing how hollow the promises were in reality.
And yet, the clever creatives at Clems couldnât have known that they were sending the public to a bank that was going to charge them about $100m for fees for services they were never going to receive, an activity that would have already been underway at the time of The Break Up.
Thatâs not what the campaign brief would have said though. That would have been based on the bank being different to the others. Which it wasnât.
Lesson 2: The battle is won and lost by the public affairs people.
In the case of the banks, the real war began years ago, when the pressure increased for a public inquiry. For a long time, the lobbyists held it at bay, finding a sympathetic ear from the Coalition government which resisted the call for as long as it could.
When the PR battle, accompanied by dark warnings about what damaging confidence in banks might do to the economy, was lost, the rest became inevitable.
Whatever the cost of the public affairs investment, it would have been worth it for the banks to stop the inquiry from happening.
Lesson 3: Learn to say sorry properly.
An irony in the events of this week is that NABâs Ken Henry and Andrew Thorburn did not lose their jobs because of the disgraceful actions of their bank. They lost it because they played the PR game poorly in the witness box.
Ken Henry in particular come across as arrogant and unapologetic in the box. Thorburn did not sound like he took the issues seriously enough. Commissioner Hayne took it as a signal that the bankâs culture had not changed.
As Michael Roddan wrote it in The Australian yesterday, Thorburn finally acknowledged it on Thursday night in a goodbye call with journalists, saying: âHave you seen page 411?â
This was where the killer paragraphs from Kenneth Hayne lay, which Thorburn read all the way back on Monday, but failed to immediately take the hint from. As Hayne put it:
âHaving heard from both the CEO, Mr Thorburn, and the Chair, Dr Henry, I am not as confident as I would wish to be that the lessons of the past have been learned.
"More particularly, I was not persuaded that NAB is willing to accept the necessary responsibility for deciding, for itself, what is the right thing to do, and then having its staff act accordingly.
âDr Henry seemed unwilling to accept any criticism of how the board had dealt with some issues.
"I thought it telling that Mr Thorburn treated all issues of fees for no service as nothing more than carelessness combined with system deficiencies.â
To continue my exploration of British sitcoms, the money being taken because of âsystem deficienciesâ is reminiscent of Father Tedâs âThat money was just resting in my accountâ.
Lesson 4: Turn to the PR professionals.
And of course, it could all have gone differently if somebody senior enough and authoritative enough had been able to persuade their bosses to rehearse beforehand, and to give them the gift of the necessary brutal feedback of how they came across.
Karen Maley has put together an excellent tick-tock for todayâs AFR Weekend newspaper. As she puts it:
âIt didn't have to end this way. Before his fateful appearance before the Hayne royal commission last November, Dr Ken Henry, the chairman of National Australia Bank, was urged to get coaching to prepare him for his encounter with the formidable senior counsel assisting, Rowena Orr, QC.
âHenry, however, refused. Unlike other top bankers who had spent hours with public relations specialists and memorising carefully scripted answers, Henry clearly had confidence in his ability to come up with ad lib replies.
âIt was a breathtaking display of hubris even from the notoriously haughty Henry. And, as in a classic Greek tragedy, Henry's excessive confidence was swiftly punished, with critics savaging his performance as contemptuous and arrogant.â
And after the report dropped this week, internal execs may have pulled their punches, when Malcolm Tuckerâs tough love was most needed. The board realised too late that they had nobody inside the tent who could be clear-eyed about the bankâs impossible situation.
As Maley puts it: âBank directors realised that they could not rely on NAB staff to provide them with an objective assessment of just how serious a predicament the bank was in. The executive's loyalty would inevitably be to the existing management.â
Lesson 5: Know when to go.
So Thorburn and Henry missed their window. Maley goes on:
âBankers watched with a mixture of horror and fascination as the week passed. They knew that the NAB's internal spin doctors would be advising Henry and Thorburn that they should try to hold on until the storm passed.â
That was always going to be bad advice.
I bet the Germans have a specific word the period of time between when it become obvious to the rest of the world that somebody has to go, and when they face up to it.
Clearly Thorburn should have known, as soon as he got to page 411. If he and Henry had gone that night, theyâd have got credit for doing the right thing by their institution.
But instead they clung on, and failed to get the tough-love advice they needed from a knowledgeable comms person.
It happens again and again.
In politics, Barnaby Joyce.
At the ABC, Justin Milne.
In cricket, David Peever.
Earlier in the inquiry, it was obvious to everyone except AMP chair Catherine Brenner that she would have to go. It had emerged she had a hand in the doctoring of what had been claimed by AMP as an independent report into its own fees-for-no-service issue.
Each time, by the time they did go, their reputations were even more diminished. The only way to get credit for a resignation is to do it fast, while still able to credibly claim itâs because itâs âthe right thingâ to do.
Lesson 6: Remember who you work for. Repeat: Remember who you work for.
One of the best pieces written about the implications of all this came from former ACCC boss Graeme Samuel. Writing for the AFR, he pointed out:
âCommissioner Kenneth Hayne summarises it nicely by outlining six very simple ideas that must inform business conduct: obey the law; do not mislead or deceive; be fair; provide services that are fit for purpose; deliver services with reasonable care and skill; when acting for another, act in the best interests of that other.â
Other industries have already woken up to the fact that this could mean them. The travel agency industry is already talking about the conflict it faces in recommending holidays to clients while taking commissions on those holidays.
And for the media agencies, this is the big, fat, flashing, red light, should they be smart enough to see it.
Earlier this week, we revealed that [the ACCC is beginning an examination of the outdoor media sector](.
Zoe Samiosâ explainer for us on [the implications of this investigation is worth a look](.
Some unpleasant issues may be lurking in the shadows. Thatâs certainly been the rumour about the outdoor, and indeed the wider media buying landscape, over the years
But even if the ACC does not proceed to a full inquiry into outdoor, the media industry should gratefully accept the pointers offered by Hayne, and act upon the warning.
If you work for a client, and donât act in their best interests - by accepting commissions that influence you not to act in their best interest, for instance - you might one day go to jail. Your actions wonât feel like a big deal at the time. It might feel like normal practice for your industry. You could just be the unlucky one who answers for it.
I suspect that everybody whoâs been near media sales or media agencies might have a story to tell about the deals that take place between media owner and agency when the client is not in the room. Value banks, anybody?
After Hayne, nobody can pretend to themselves they havenât been warned about the consequence of failing to act only for the person youâre acting for.
âWhen acting for another, act in the best interests of that other.â It sounds so simple, doesnât it?
Meanwhile, the reputation challenge for NAB, AMP, and fellow big bank CommBank may not even be through the worst yet. Todayâs Weekend Australian reports that Commissioner Hayne has discussed criminal prosecutions for the three.
I hope you have a better weekend than them.
As ever, I welcome hearing from you at tim@mumbrella.com.au. Iâm also covering the Mumbrella newsdesk this weekend so feel free to contact me on the news front too.
Toodlepip...
Tim Burrowes
Content director - Mumbrella
Sponsored Post
The [Cooperate]( platform transforms how marketing teams visualise their customer journey, deliver content at each stage of the journey, and see how it performs - from one place.
Australian enterprises like [Monash University,]( [SFI Health](, The Heart Foundation, UNSW and TicToc Home Loans can finally manage content across the customer journey, empowering their teams to visualise the entire journey from start to finish, and manage all of the marketing work in-between.
Mumbrella | 46-48 Balfour Street Chippendale NSW 2008 Australia
[Unsubscribe](| [Manage Subscriptions](
[Facebook]( [LinkedIn]( [Twitter](