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Leadership skills of a crusading communicator

This is the second in a series of articles highlighting the leadership attributes that can help the superannuation industry move from its historical emphasis on accumulation to a whole-of-life focus and particularly on retirement income provision.

If one person is renowned in funds management globally as a leader who truly made a difference, it must be Vanguard Group Founder, Jack Bogle. Over a career spanning seven decades, Jack not only created a company that has become the world’s largest mutual fund company, but profoundly influenced millions of investors and the industry itself.

I had the great privilege to work directly with Jack over the 16-year US-based component of my Vanguard career and have maintained close contact ever since. I saw up-close the many dimensions of a great leader.

Jack demonstrated exceptional leadership in many ways. The most obvious include his organisational design leadership in creating Vanguard in 1975 as a ‘mutual’ fund company, operating at-cost, solely in the interests of its investor owners. It’s a unique structure in the US which has allowed Vanguard to assert price leadership and, over time, become the lowest cost mutual fund provider. Jack is, of course, well known also for product leadership, as the creator of the first index mutual fund (in 1976), among a number of other significant product innovations. Further, he has been an investment leader by articulating a clear ‘common sense’ philosophy for investors to follow. And, he has demonstrated moral leadership in countless ways, but mostly by speaking out on what’s right for investors, and what isn’t, and by making the case for a greater fiduciary and a lesser sales attitude within the industry.

Leadership in communications to build trust

However, to pick just one leadership strength that fascinates me and is relevant to all leaders in our industry, I’ll focus this article on his communications leadership. Jack Bogle has been a remarkable and tireless communicator over many decades. Communications counts in investment services and superannuation, much more than most people credit. We’re dealing with an intangible service. We must build trust. The fundamental source of trust is communication and actions that correspond to the communications. The ‘talk’ then ‘walking the talk’.

In the 1980s and 1990s, Vanguard became a dominant retail firm, after having abandoned the commissioned broker sales force which built its predecessor, the Wellington Funds. Vanguard would go ‘direct’ and a strong voice was needed to articulate a winning proposition for fund investors. Jack believed the consumer would be king and would somehow find their way to Valley Forge, Pennsylvania if we built the proverbial ‘better mousetrap’. But someone had to tell them about it, long before the days of social media and viral campaigns. Vanguard, the low cost provider with little money to spend on marketing, had to get the word out.

Jack started with the existing client base. He made sure they knew what he and Vanguard stood for. He personally wrote a letter in all client investment reports. He replied directly to every client who wrote to him. (It’s amazing how powerful it is when the Chief Executive writes a personal letter to a client, particularly when it’s beautifully articulate and elegant.)

He made it clear what investment philosophy Vanguard stood for. He talked common sense, not investment gobbledygook. He differentiated Vanguard’s investment beliefs from those of the masses by focusing on long-term investing and keeping costs low. And he made sure it was a consistent body of investment beliefs that investors could adopt for themselves.

Beyond the client base, he worked hard to create a distinctive voice for Vanguard in the marketplace. It was his voice. It was strong, insistent and opinionated but common sense, and it was emotionally appealing to consumers. He sought press attention and, because he gave them a strong story, he got the attention, time and again. There’s nothing quite like free and positive press to get a direct business going.

What’s the evidence that communication mattered? Firstly, despite its modest marketing budget, Vanguard began picking up market share. Secondly, the growth of indexing in retail investors’ portfolios went from nothing to trillions today. There is no question in my mind that without Jack Bogle’s advocacy of indexing caused the swelling of retail indexing usage we’ve seen over the past three decades. Third, as Jack likes to say: “you can’t be a leader without followers.” Jack has millions of followers, even a fan club, called the Bogleheads.

Remarkably, Jack didn’t stop his communications push with investors once he stepped down as CEO. He has now written 10 books, and tells me he’s working on his 11th (at age 86!).

Lessons for retirement income providers

One of our greatest leadership needs – as we go beyond an accumulation-focused industry – is to communicate in a powerful way with our members. We have to be agents of change and we’re going to need our best communications skills to bring members with us.

In helping our members manage the transition to retirement here are some of the communications challenges we face:

  • Switching the members’ focus from balances and lump sums to sustainable retirement incomes
  • Engaging them with the need to build an adequate nest-egg when today’s compulsory contribution levels are patently insufficient
  • Conveying to the members our intention (and ability) to help them during retirement
  • Helping members at retirement make the right choices with the difficult task of deciding how to invest for a sustainable retirement income
  • Guiding members through market cycles when they no longer have access to salary income. In Jack Bogle’s lingo, helping them “stay the course”
  • Earning members’ trust so that they are receptive to our help and advice.

How Bogle might approach the problem

You don’t have to tackle it like Jack Bogle, but here are a few lessons from close observation:

Have something to say and be different: Lack of substance doesn’t cut it. Bland doesn’t cut it. Jack was a crusading agent of change. He had strong beliefs and expressed strong opinions and was prepared to back them up. He sought to differentiate.

Convey passion and conviction: Show your audience you care and bring a sense of urgency to the matter. For Bogle, caring is an essential theme of leadership.

Respect communications: Too few executives think communication matters. They don’t put the work or time in that’s needed. They may just delegate it and pay little attention to the quality of the work of their communications department – and it shows. Jack loved communications having a deep respect for his audience and the English language.

Work hard at it: Communications is an art that improves with practice. Jack followed the preacher’s rule: 20 minutes of prep for every one minute of speech.

Be genuine: Admit your humanity. Make a connection. Be genuine. People know if you’re not the real deal. If you don’t really care about the investor, don’t pretend to.

Make the emotional connection: We tend towards dry rational thinking in our industry, but our audience is diverse and human and it values emotional connection. Bring your communications to life with stories, anecdotes, humanity. It is much more than logic and numbers.

Get your team on board: Don’t overlook the importance of great communications with your team. Jack shared his vision with his colleagues and convinced them to share his vision. He used an old-fashioned device, the speech, but he used it brilliantly. We all knew what Vanguard stood for.

Repeat (but stay fresh): Repeat the key messages over and over again. That’s how lessons sink in. Finding new and fresh ways of getting the key points across is a challenge but a worthy one.

Even if you’re not going to lead communications yourself, it’s essential that you build communications capabilities that allow your firm to lead. Jack’s successors totally respected the value of communications and expanded the institution’s abilities to communicate well with clients using newer media as the digital age dawned.

It’s going to take some crusaders to move this industry to a new focus on retirement incomes. And communications will be a powerful part of their armoury.


Jeremy Duffield is CoFounder of SuperEd. See He was the Managing Director and Founder of Vanguard Investments Australia, and he retired as Chairman in 2010.


Vale Jack Bogle


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