Branston deal a reminder of what a pickle Premier Foods has got itself into

October 31, 2012

Old food brands don’t die, they just get traded away. The latest to fall under the auctioneer’s hammer is Branston – sweet pickle, but also ketchup, mayonnaise and salad cream – which has been knocked down to Japanese relishes specialist Mizkan for £92.5m. It’s the second deal Premier Foods has done with Mizkan. Earlier this year, Premier sold its Haywards pickles business and Sarson’s vinegar brand to the privately-owned Japanese company for £41m.

Not so long ago, Premier was being billed as Britain’s biggest (indigenous) food company. That reputation has long gone, as the company struggles to placate an increasingly disenchanted City with a seemingly endless series of disposals aimed at tackling massive over-leverage (it borrowed far too much in the good years) and a burgeoning pension liability.

The finance boys, not to mention Premier’s new(ish) broom chief executive Michael Clarke (formerly Kraft Food Euro chief), are so chuffed at being ahead of schedule in reducing the debt mountain that they seem to have forgotten what the company is supposed to be about.

These days, the only media ripple Premier manages to make is when it announces yet another fire-sale. Last December it was Brookes Avana, its loss-making chilled food business, sold for £30m. Earlier in 2011, it canning business went to Princes (now part of Mitsubishi) for £182m, and before that, the meat-free business – commonly known as Quorn – for £205m.

In fact, so many brands have disappeared from the portfolio in the past few years that people must wonder what – if anything apart from trying to make money – the Premier umbrella brand stands for these days. Remember Gale’s Honey? Robertson’s Jam? Hartley’s? Chiver’s? Typhoo Tea? All once UK household names – now long since divested.

And more disposals are on the way. Bird’s Custard, for example. And even – if the price is right – the Premier bread business; that’s Hovis to you and me. Which, if I remember rightly, was the jewel in the crown when Premier acquired the old Ranks Hovis McDougall business back in 2007.

The talk in the boardroom is of scaling back to the unassailable fortress of Premier’s so-called “Power Brands”, of which Hovis is currently one (yes, that unassailable). The others are Mr Kipling, Ambrosia, Sharwood’s, Loyd Grossman, Oxo, Bisto, and Batchelors.

To the untutored eye, there’s nothing very “unassailable” about any of these, either. The Loyd Grossman business is unlikely to much outlive the celebrity of its founder. As for Bisto, Batchelors, Mr Kipling and Ambrosia, they are in – or moving towards – the brand museum category: famous items in the pantry a generation ago, but now confined to a dubious ranking on the health traffic light scheme featuring in your local supermarket.

Unilever and the likes of Néstlé, Kraft, Campbell’s and RHM saw the dismal future awaiting such brands long ago, which is why they first cut off marketing support and then disposed of them. Scavenging such brands may have made sense while borrowing costs were no object; and while the supermarkets were prepared to offer them a reasonable amount of shelf space. But they aren’t any more.

For these reasons, a big question mark hangs over Premier, its “Power Brands”, and the continuing viability of its business model.


Cook acts after Browett upsets the Apple cart with half-baked retail recipe

October 30, 2012

The surprise is not that John Browett, former Dixons CEO and Tesco high-flier, quit Apple after only 6 months. The surprise is he wasn’t fired earlier: or indeed that he was hired at all.

Not that there’s anything wrong with Browett’s retail skills, in their place. Which is, or was, running a British high street retailer; not at the helm of the retail arm of a global corporation fanatically dedicated to innovative product launches and superior customer service.

The announcement of Browett’s departure, which coincides with – but is only tangentially connected to – the sacrificial dispatch of Scott Forstall, head of iPhone software (for the horlicks he made of the new Maps app), has been greeted with widespread “told-you-so” cynicism. And nowhere more articulately than in the comments section of The Telegraph online.

My own favourite? Quote from Mr Cook : ‘Mr Browett had a commitment to customer service “like no one else we’ve met.” ‘ Similar to Morecambe and Wise writing: ‘We shall tell all our friends’ in the visitors’ book at a particularly awful Blackpool b&b.

Quite. The fault lies not so much with Browett (who is in any case going to walk away with much of his £36m golden hello intact) for initiating ‘pile it high and flog it cheap’ tactics – the only thing he knows – but with Apple’s chief executive Tim Cook. Whatever was he thinking of when he made the appointment late last year? Browett is the complete antithesis of everything Apple stands for.

It’s not about command-and-control retail structures where costs are minutely controlled. It is about money-being-no-object where customer service is concerned. It’s also about silo’ed autonomy, something alien to Browett’s own retail culture.

Cook can chalk this one down to inexperience. But it does make you wonder whether he’s got a sufficient measure of the “vision thing”.


Clint Eastwood – Romney’s Fifth Cavalry

October 24, 2012

What was it Wellington used to say? Something about Napoleon’s hat on the battlefield being worth 50,000 men. I reckon Clint Eastwood, more revered than any living president past or present, could be worth considerably more than 50,000 votes in the battlefield states.

Clint, you may remember, spent most of his time at the Republican Convention talking to an empty chair, representing the incumbent president. His performance seemed to say a lot more about Clint than it did about Mitt Romney.

Now he has finally come off the fence, openly endorsing Romney in a 30 second spot:

American Crossroads, by the way, is a major Romney PAC (Political Action Committee).

Wasted on the mayorship of Carmel-by-the-Sea, Ca, wasn’t he?


L’Oréal photo “shopping” Dior to the ASA? A case of the pot calling the kettle black

October 24, 2012

No surprise that the Advertising Standards Authority has banned another beauty ad – this time Black Swan Actress Natalie Portman modelling Christian Dior’s mascara, on account of her eyelashes being airbrushed to artificial perfection.

Much more interesting is the fact that the complainant is not some earnest advocate of “real beauty” and, er, truth in advertising, but Dior’s deadly rival in the cosmetics business, L’Oréal.

Pretty rich, all things considered: as a manipulator of the truth, L’Oréal takes some beating. Readers of this blog will recall the case of Cheryl Cole’s false locks, and Beyoncé’s preternaturally “latte” skin tint. They may also have noted a series of ASA bans over the last year or two affecting L’Oréal ads featuring Rachel Weisz, Christy Turlington, Julia Roberts and Penelope Cruz: in fact, just about every female brand ambassador L’Oréal has ever used. Although, come to think of it, no one, so far as I know, has yet got round to checking the hair-roots of Andie MacDowell, L’Oréal’s recruiting sergeant in the eternal war against the Greys, to see whether it’s actually a wig she is wearing.

Apologists for L’Oréal will no doubt tell their critics to get real: they are merely working in a long and dishonourable tradition of deception. Perfect beauty is by definition impossible to attain and when women strive for it, they don’t want it represented by a warts-and-all model but by a heavenly idealisation.

Nevertheless, L’Oréal’s hypocritical assault on Dior plumbs new depths of cynicism. Compared with its own systematic distortion of visual reality, Dior’s misdemeanour – which consisted of photoshopping La Portman’s individual lashes – is a mere peccadillo.

Playing Goody Two-Shoes may yet boomerang upon L’Oréal. Unless it really has turned over a new leaf, which I doubt.


BBC in uproar and not a Twitter from @rupertmurdoch

October 23, 2012

Considering the gloating opportunities, @rupertmurdoch has been abnormally restrained. Apart from a terse but prescient: “Saville (sic)- BBC story long way to run. BBC far the biggest, most powerful organization in UK,” nothing has been said on the subject since October 14th.

Maybe the old boy has got bored with his favourite hobby, the British media. But I somehow doubt it. And his silence certainly can’t be attributed to not wanting to stick the knife in – as Hugh Grant, the “Scumbag Celebrity”, knows to his cost. No, @rupertmurdoch is surely waiting until the dish is sufficiently cold to make a mouthful of it.

And what a mouthful. The BBC has rightly made much of the fact that Savilegate (all crises these days are “-gates”, aren’t they?) has a silver lining. No other news organisation, they say, would be capable of an equivalently rigorous self-examination in the wake of such an error. “Mea culpa” is not, after all, a term you hear very often at News International – or anywhere else, for that matter, unless the lawyers so decree. But the BBC being more transparent is no guarantee that its senior executives are any less mendacious, self-serving and slippery than those of other media owners.

Today’s performance before the culture media and sport select committee by a nervous George Entwistle, now director-general, then director of vision (i.e. telly), left us in little doubt that Newsnight’s editor Peter Rippon is the one being lined up for the sacrificial knife. And it’s his blog what done it.

True, Rippon’s version of the facts leaves much to be desired. There are a number of errors in the post which make it apparent that, even looked at in the most charitable light, Rippon’s grasp of the situation was woefully inadequate. The point about not withholding information from the police, for instance, is downright misleading (whether deliberately so or not). That’s certainly conduct unbecoming in the editor of a programme of Newsnight’s calibre.

But all this proves very little, except that Rippon was desperate for some ex-post facto sticking plaster to justify a decision that he himself may have found incompatible with his professional ethics. The question is: how did he arrive at that decision? Hard evidence has yet to surface, but circumstantially there seem a number of things that just don’t add up. At one moment, Rippon is reported by the Newsnight editorial team to be upbeat about the Savile programme’s prospects; the next, he has decided to shelve it. Apparently, this happened very soon after he had informed the BBC’s head of news, Helen Boaden, of the programme’s content and intention. Boaden then told her boss, Entwistle. But, according to him, only in the most airy, abstract manner. With the result that this normally competent media professional entirely failed to recognise the Newsnight investigation might in, some way, undermine a lavish tribute programme shortly to be aired in Sir Jimmy’s honour – and make complete fools of the Corporation’s senior executives at the same time. That at least is what he is asking us to believe, since he clearly took no action to review the tribute programme.

Rippon, of course, is denying that Boaden gave him any advice beyond telling him to act according to his own lights. Whether that advice included a knowing wink and a nod, alluding to his future on the BBC career ladder, we shall probably never know. Boaden’s words are unrecorded, and she shows no sign of wishing to enlighten us further.

That said, maybe we should keep this affair in perspective. BBC executives may be dealing in half-truths and obfuscation, but they can hardly be accused of breaking the law. Unlike Trinity Mirror, publisher of the Daily Mirror, Sunday Mirror and The People, which is now facing civil actions over phone-hacking from former England manager Sven-Goran Eriksson and a number of other minor celebrities. Trinity Mirror’s senior management is, as it has routinely done since questions started to be voiced about Piers Morgan’s tenure as editor of The Mirror, denying any wrongdoing. But shareholders obviously don’t believe them. At one point, TMG shares dipped 12.5% today. Civil actions were the slow-burning fuse that eventually lit the powder-keg at News International.

As I say, the old boy is going to have a right old feast, once he gets round to serving it.


Lancing the boil of celebrity culture

October 18, 2012

For years he wove a cynical circle of deceit around the community, perpetrating the most heinous misdeeds while masquerading as a benefactor of mankind.

Of course, there were a few whispers. Doubters who thought the myth he had wrapped around himself was too good to be true. Alleged victims of his corruption who knew for certain he was a Wrong ‘Un (or so they claimed).

But who were these people? The spiteful and envious, endeavouring to poison the reputation of a noble celebrity with unfounded gossip. Or worse, Society’s sad losers maliciously fabricating tales of victimisation for their own financial gain. And why should we take any notice of them when their intended target was such a fine, upstanding, pillar of the community?

Jimmy Savile – for now, still a still a Knight of the Realm and Knight Commander of the Star, by order of the Holy See; Lance Armstrong – for now, still 7-times winner of the Tour de France: what’s the difference? They were gigantic frauds and they’ve had a good laugh at the expense of us all. But now it’s all over. Jimmy remains an untouchable – in a technical sense, at any rate, since he is beyond the grave. Lance is a little less fortunate. His life-expectancy, in view of the cancer challenge and toxic artificial stimulants religiously ingested over the years, must be severely foreshortened. Alas, not so foreshortened that he can escape the hand of Justice clamping his shoulder and calling him to account; or the incessant righteous ‘told-you-so’ opprobrium that will now rain down on his already mired reputation.

Because that’s the thing about reputations. Once trashed, there’s no rehabilitation, no going back. The evil that men do lives after them, the good is oft interred with their  bones.

Who, a few months on, will want to remember that Savile, the child molester and serial pervert, was also a doer of good deeds whose work for charity raised an estimated £40m?

Who now will wish to recall that Armstrong’s reputation and sporting prowess, however achieved, was indispensable to the success of the Livestrong, the cancer charity he founded 15 years ago?

Last year $35.8 million went through the charity’s books, 82 per cent of which was passed on directly to research programmes.

Yes, they were both self-serving hypocrites, in the sense they pretended to a piety they richly did not deserve. But weren’t we all complicit in that hypocrisy as well? Not just institutions like the BBC, Stoke Mandeville Hospital, or sponsors such as Nike, Oakley and Anheuser-Busch – who clearly had a vested interest in nay-saying whenever allegations of inappropriate conduct surfaced; but the rest of us too, who were gullible enough to believe that our idols really don’t have feet of clay? After all, who’s looking at the feet when the object of veneration is walking on water?

So, if Armstrong’s sponsors are heading for the exit as fast as their own feet of clay will carry them, and Savile’s charity is now studiously engaged in an act of collective amnesia over its founder’s name, can we really blame them? They are just as obsessed with, and as gullible about, celebrity culture as the rest of us.


L’Affaire Renault reaches a suicidal nadir

October 12, 2012

Ah, the cynicism of the modern corporation. Remember all those years ago when Jo Moore, spin doctor to Stephen Byers, Department of Transport, Local Government and Regions secretary, emailed her boss those immortal words, referring to 9/11: “It’s now a very good day to get out anything we want to bury.”?

Well, now the French are having a similar moment of national revulsion at what’s called “L’Affaire Renault”. Readers of this blog will recall my post detailing Publicis Groupe CEO Maurice Lévy’s grubby attempt – successful at first – to stitch up Renault director of customer marketing Philippe Clogenson when the latter had the temerity to consider placing his business outside the Publicis empire. Clogenson was one of four senior Renault executives summarily fired (Clogenson for corruption, the other three for alleged industrial espionage) at the beginning of 2011 – only to be rehabilitated in the most humiliating way possible for Renault boss Carlos Ghosn and his number two, who subsequently had to resign.

And, guess what? The judicial investigation into the Renault scandal, now consuming many hours of M. Ghosn’s time, has turned up a new shocker. According to verified documents published in Le Parisien today, the car manufacturer had prepared draft statements for release in the eventuality that any of the executives attempted or committed suicide. The draft document, prepared by then director of communications Frédérique Le Grèves, read, “The entire company is profoundly shaken by the seriousness of this act. Our thoughts are with the family of M. XXX.” Fill in, as appropriate.

Contacted by Le Parisien, Le Grèves – now Ghosn’s chief of staff – managed to dig herself into a still deeper hole by insisting that the draft communiqué was “pure and simple anticipation, just a form of words in case we needed to respond to journalists.” The rehabilitated executives must have been delighted with that touch. But the broader point, which seems to have escaped Renault’s senior management, is the French public is aghast at the cynicism of it all. Le Grèves simply can’t understand what all the hullabaloo is about. I wonder how much longer she will remain Le Ghosn’s chief of staff.

The examining magistrate, Hervé Robert, took up half a day of Ghosn’s valuable time during his last hearing – and has threatened a 10-hour marathon during his next. I’m sure Lévy can barely wait for the judge’s attention to be turned to himself.


Will the real Grant Shapps please stand up

October 6, 2012

The Advertising Standards Authority must be rueing the day they had their remit extended to website jurisdiction, after unwittingly becoming a political football in the poisonous fracas over Tory Party chairman Grant Shapps’ personal integrity.

It all began innocuously enough when blogger The Plashing Vole drew our attention to the upwardly mobile Tory minister’s apparently harmless multiple personality disorder. In his younger days, Mr Shapps had posed as a certain “Michael Green”, web entrepreneur and wheeler-dealer millionaire.

However, Mr Green, unlike Mr Shapps, was far from being a person of stainless reputation. Mr Green’s line of work was creating internet companies like howtocorp.com which peddled “Self Help” and “Get Rich Quickly” software packages at $500 a pop, rather in the manner of snake-oil salesmen and the travelling apothecaries of the Wild West. By way of example, one of How To Corp’s top products was something called TrafficPaymaster, which purported to bring gullible or unscrupulous customers instant riches by “scraping” – or, to use the vernacular, “plagiarising” – other people’s web content and claiming the resultant Google-generated ad revenue. Google has reprimanded TrafficPaymaster for being ‘unethical’, though it was not – I hasten to add – actually acting illegally.

Michael Green’s websites have now disappeared from the internet and Mr Shapps assures us that he has long since overcome the Green personality psychosis. Part of the therapy has involved displacing Green’s identity onto his wife Belinda, who has manfully managed the internet marketing company all on her own since 2008.

Alas, there has been an occasional relapse. In 2010, for instance, Michael popped up as the author of a book called How to Bounce Back from Recession, replete with Samuel Smiles-style self-help platitudes and lots of ‘$20,000 in 20 days’ guarantees.

The exposure of a ‘Michael Green’ relapse might be considered embarrassment enough for a Tory politician shinning up the greasy political pole, but there was worse to come.

Mr Vole, aka Dr Aidan Byrne, senior lecturer in English, Media and Cultural Studies at the University of Wolverhampton and fencing master extraordinaire, has descried a further Shapps alter ego in the person of “Sebastian Fox”. It turns out Mr Fox has taken a proprietorial interest in How To Corp, to the extent that the website is now called Sebastian Fox’s How to Corp – The Home of Great Toolkits on the Net.

Vole – and he cannot be alone in this – felt such conduct unbecoming of a former, and no doubt future, minister of the crown.

“After a bit of digging,” he tells us, “I decided that the enthusiastic endorsements by happy customers of HowToCorp might be just as fictional as Grant’s alter egos.” So, he complained to the ASA about it. And great was his joy when they agreed to investigate: “I have a reply from the ASA. They’re going to conduct a proper investigation. This might be a little uncomfortable for Shapps and his wife Belinda. They will have to demonstrate the existence of Fox, Green and the endorsers… which might be a tad difficult.”

That was on September 28th, and things have moved on a bit since then. The ASA have got into a state of high dudgeon over Dr Vole sharing with his readers their “confidential” missive to him and are threatening to can the investigation. All trace of Sebastian Fox’s How to Corp now seems to have been expunged from the internet, although readers eager for an insight may treasure this memento on YouTube:

Meantime, Shapps is at the centre of a media circus, and not enjoying every minute of it. In fact, he’s acting like a cornered wild beast, lashing out at anyone with the temerity to have a go at him – Ed Milliband being the latest victim. Not surprisingly really: in the light of these revelations, we must at best regard Shapps as slightly crackers, and at worst, downright dodgy. Is this the kind of man who should be put in a position of public trust?

And it’s not just Shapps’ conduct that ought to be taken into consideration. He is part of a pattern – of bad judgement on the part of David Cameron. Or, as Volely puts it:

So far we’ve had David Laws fiddling his expenses. Jeremy Hunt hides between trees and secretly promotes the interests of Rupert Murdoch over the public good, Michael Gove using his wife’s email address to hide his dodgy and partisan dealings in the education sphere (in an attempt to evade the Freedom of Information Act), and Liam Fox forced to resign after he failed to make any distinction between his friends’ arms-dealing and intelligence businesses, sinister military-industrial pressure groups and his responsibilities as a government minister.

May I respectfully add to this compendious catalogue the name of  Shapps’ immediate predecessor as Party chairman, Baroness Warsi?

You’ve scored a palpable hit, Dr Byrne. Just what’s needed before the annual party conference.


Rail crash? You wait until they try to auction the 4G mobile phone spectrum

October 4, 2012

Business groups have launched  a scathing attack on the Government over the 4G spectrum auction and say it has revealed serious problems at the heart of public sector procurement. Simon Walker, director general of the Institute of Directors, expressed a typical view: “It is shocking that such a crucially important process has gone so seriously wrong. Businesses need a stable, reliable telecoms network and certainty in the provision of key infrastructure.” “Procurement mistakes increase risks for companies, threaten jobs and harm Britain’s reputation as a destination for inward investment,” added Adam Marshall, policy director of the British Chambers of Commerce.

Just joking. I’m sure Messrs Walker and Marshall will forgive me for quoting them out of context this once; after all, I’m investing them with seer-like prescience. Their cited words are real, but in fact relate to the very clear and present danger of the West Coast Main Line rail fiasco. The fallout from that will be a moon-cast shadow compared to what will happen if HMG manages to screw up the mobile phone spectrum in the same way it has screwed up our railway network.

As it happens, there has been some relatively good news on the 4G front recently. Maria Miller, the obscure former Grey advertising and PR executive recently catapulted to culture, media and sports secretary, has made a brisk start to her tenure by bringing forward the inexplicably delayed auction date of 4G spectrum to January and cutting through the legal wrangling among telecoms carriers which has deadlocked the introduction of the new, much faster, mobile phone standard to the UK.

But will her timely action be enough to avert a looming disaster? First, a little background. 4G is not some minor incremental improvement on the current standard, 3G. It can offer speeds of up to ten times that of the average current home broadband service. Data-hungry yoof, but more importantly business people and commuters, will love it. Miller herself observes that its introduction is “a key part of economic growth strategy” and will “boost the UK’s economy by around £2-3bn” (growth at last – the stuff that George Osborne’s political dreams are made of). America’s already got it, Apple’s got it, Germany’s got it, Korea’s got it. For God’s sake, Estonia’s got it. Britain, which prides itself on being at the heart of the digital revolution, has not. Why not? Because of years of government dithering over the auction structure. Gordon Brown made a bit of an idiot of himself by appearing to hand out the lucrative 3G spectrum to the telecoms carriers for a song. Successive administrations since have been determined not to make the same mistake twice, but seem uncertain how to prevent it.

Now events have caught up with them. The situation is complex, but distils down to a simple reality. Apple has launched its latest ‘must-have’ iPhone with a 4G capability that no one in the UK will be able to take advantage of in the near future. Well, almost no one. The exception: those who use EE, as of October 30th. Er, let me qualify that. No, not all users of Orange and T-Mobile, the brands which have had all their resources pooled into the Everything Everywhere receptacle (or EE, as it is now known – what a whoopee cushion of a brand name). EE itself has the exclusive iPhone 5 franchise, and only new subscribers, not old customers, will benefit from the 4G offering. Everyone else – that is, the vast majority of UK mobile phone users – will have to wait at least 8 months to subscribe.

It may well be objected that what gives the EE brand a timely ‘digital’ lift is actually brand suicide for the company’s premier and better known brand, Orange. But that’s one for UK chief executive Olaf Swantee and his strategy team to worry about. In the meantime, they can congratulate themselves on having – unlike their competitors – farmed existing spectrum to make space for the 4G platform. A merry Christmas is assured, thanks to the exclusivity of their iPhone 5 4G contract.

Once EE’s rivals, O2, Vodafone and Three, realised what Swantee was up to, cries of  “Unfair” and “Unlevel Playing Field” were heard to rend the air. EE had played the ant in Aesop’s fable, and harvested its existing resources wisely, but the grasshoppers were beside themselves with rage that they would have to wait another six months to grab their share of the new spectrum via a dilatory government auction – and then some before the service could actually be implemented. What’s more, they were prepared to act decisively: they threatened to blunt EE’s leading edge with legal action. That might have been explicable in terms of competitive advantage and buying extra time to build the necessary 4G infrastructure. But as a prelude to launching the 4G standard in the UK, it would have created a public relations disaster. How do you explain to an iPhone-crazy public that access to much higher broadband speeds is being blocked by red-tape, selfish industry interest and legal chicanery?

Miller has therefore done well to defuse the legal wrangling by agreeing to bring forward the spectrum auction date 6 months to the end of January. But implementation of the 4G dream is still a long, long, way away for most of us punters – we’re talking at least the latter end of next year. In the meantime, all sorts of teething problems will need to be sorted out: poor signal distribution, patchy network coverage, a quite possibly incompetent auction process that leads to further legal action and, let’s not forget, potentially incompatible 4G phones.

“Wrong spectrum”. We’re going to be hearing a lot of that in the next 12 months, while the phone companies sort themselves out. If my mobile phone contract were coming up for renewal (which it is not), I would be very tempted to let it ride until at least the beginning of 2014 …


Minick-Scokalo’s star in the ascendant after Pearson picks her boss as next CEO?

October 3, 2012

What now for upwardly mobile executive Tamara Minick-Scokalo? I ask because her immediate boss, John Fallon, has just emerged as the future chief executive of Pearson, owner of – among other things – the Financial Times and Penguin.

When last encountered on this blog, Minick-Scokalo – for most of her career a Procter & Gamble executive, but latterly occupying high-octane posts at Cadbury and Kraft – had managed to secure a plum job at Pearson as president of the Europe, Middle East, Africa and Caribbean elements of its international education business. She reported directly to Fallon, who was chief executive of all areas of the business outside the USA.

In one sense the choice of Fallon to succeed Majorie Scardino, CEO of Pearson for the last 16 years, is a great surprise. He’s not even on the main Pearson board yet. What’s more he’s essentially a marcoms man, having served as director of corporate affairs at Powergen before joining Pearson in 1997, and in a variety of comms roles in the public sector before that. The more usual recruiting ground for FTSE 100 company chief executives is the finance department. And, as it happens, Pearson has the perfect paper candidate: Rona Fairhead, chief executive of Financial Times Group. Right age (about 50, the same age as Fallon); right sex; right background, as former chief financial officer of Pearson; and already a main board member to boot.

So why Fallon? Look at his record. It cannot be an accident that in the five years he occupied Minick-Scokalo’s current role, and the four since in which he has been chief executive of the division, international education has become the mainstay of Pearson’s reputation – not to mention its credibility with shareholders. For once, I cannot put it better than the company statement on the subject:

“With more than 15,000 people in 70 countries, this division is fundamental to Pearson’s growth strategy. Under John’s leadership, international education sales have increased from £322m to £1.4bn and profits from £12m to almost £200m in the past decade.”

It should be added that Fallon has also demonstrated a shrewd talent for acquisitions  – a reassuring quality in any future leader of a global company. These include the Wall Street English education business and the China-based Global Education and Technology Group. By way of perspective, profits across the ramshackle Pearson empire  as a whole totalled £942m in 2011.

Fallon seems likely to continue Scardino’s strategy of pruning Pearson’s over-extended interests – which at one time included investment bank Lazards, one of the best vineyards in the world and Madame Tussauds. Next on the chopping board may be the Financial Times itself. Certainly Fallon did nothing to reassure anxious hacks on the subject. When pressed on whether his appointment makes it more likely that Pearson will seek to dispose of the FT Group, he merely observed: “I very much recognise and value the FT as a valuable part of the company.” I’ll take that as a yes then, particularly from a former PR man. One more reason, perhaps, why Fairhead – very much at the heart of the FT – didn’t get the top job.

But what’s bad news for the FT may be very good news for Minick-Scokalo’s career prospects. She seems in prime position to claim Fallon’s former hot seat. Let’s put it this way: if she doesn’t get the job, she will probably be disappointed enough to leave Pearson’s employ.


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