Looks like Tony Hayward will have his life back after all. British oil giant BP has replaced him with Bob Dudley, an American known for diplomacy. This move that might soften U.S. criticism of the way BP has been handling the oil spill in the Gulf of Mexico.
It's pretty clear that Hayward was not the best in public relations, and has inevitably become a lightning rod for all criticism aimed at the oil spill. In the corporate world today, when perceptions can make or break a company, PR is an important part of an executive's role (particularly in times of crisis). A CEO sets the tone for the whole company, and unintentional missteps and communications are negatives for a firm's external image, as well as for its internal morale.
But that's not the only way CEOs impact companies.
A CEO is the leader of the organization and no matter what they claim, they are ultimately responsible for what happens in the company. The effectiveness of senior management within an organization reflects the quality and capabilities of the CEO. Hayward implied at a Senate testimony last month that the oil spill wasn't his responsibility. Democrat Henry Waxman told Hayward he was simply "kicking the can down the road". The buck stops with the leader.
It might not be fair but that's reality.
It has often been said that a CEO's microphone is always on and in my experience as a leader of an organization, that is certainly the case. Tone and values are largely dictated by the attitude of leadership and major shifts can occur in organizations when CEOs are replaced.