Pablo Isla, CEO of Inditex … the humble Spaniard is the world’s best performing CEO of 2018
December 1, 2018
The world’s business leaders face a diversity of challenges – demanding customers, relentless competition, profit-hungry investors, political and economic headwinds. Yet their companies have shown a remarkable ability to sustain momentum.
In this year’s ranking by HBR of “The World’s Best Performing CEOs” 70 of the 100 leaders in last year’s ranking performed well enough to achieve the distinction again this year—including 54 year old Spaniard, Pablo Isla, of the Spanish fast-retailing giant Inditex, who is once again the number-one-ranked CEO.
In the global top 5, he is followed by Nvidia’s CEO Jensen Huang, LVMH’s Bernard Arnault, Francoise-Henri Pinault of Kering, and Elmar Degenhardt of Continental. Familiar names such as Nike’s Mark Parker ranks 14th, Microsoft’s Satya Nadella is at 46, and Netflix’s Reed Hastings at 83
The HBR ranking takes a long-term view of performance, based primarily on financial returns over each CEO’s entire tenure. It also considers environmental, social, and governance issues.
20 of the CEOs lead companies based outside their countries of birth. 32 have an MBA, up from 29 last year. 34 have an engineering degree, up from 32 last year.On average, they became CEO at age 44 and have been in office 16 years. 3 are women, up from 2 last year. 87 are insiders, up from 81 last year.
During Isla’s 12-year tenure at Inditex, with brands from Zara to Mango, his company has increased in market value seven times over, engaged in global expansion at a rate of on average one new store opening a day, and has become Spain’s most valuable company. Impressive by anyone’s standards.
Isla has chosen winning strategies like integrating the online and in-store shopping experience to feel seamless and focusing on the ability to quickly react to fashion trends with an integrated supply chain.
But what stands out is the single word description employees use to convey Isla’s management style. Humble. It’s how his employees talk about him and how he talks of his approach that’s the most telling.
He is known for rejecting a meeting culture and the use of hierarchy to command, control, and ego-feed, instead favouring making decisions informally in partnership with his people as he “manages by walking around”.
In fact Isla is so notoriously shy of being in the spotlight that he doesn’t go to his own store openings. Isla described his approach to HBR:
“What we want to be relevant is the company or the store opening, and everything always is the result of the work of a team of people. The strength of our company is the combination of everybody, much more than of any single person. And I can tell you that as a company, we try to be a low-profile company, being humble, of course being very ambitious, but being humble. And if we have a big store opening, we want the store to be the relevant thing, and not any particular person.”
Smartly, Isla focuses on putting the spotlight on what is most relevant to the consumer. The core shopper lusting for a $50 pair of affordable but high-fashion high heels from Zara wants to hear about the new store in her neighbourhood, not about how in control some privileged executive is. And he puts the spotlight on the most relevant employees – the front line store managers who are empowered to make product selections and whom he supports via a robust promote from within policy.