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A man poised to rally his new troops

Joseph Clayton:
A man poised to rally his new troops

Dressed like Gen. George Patton– down to the riding crop–Joseph Clayton rode atop an Army tank as he ordered it to crush dozens of Japanese-made television sets.
“I am a big believer in motivation,” Clayton says. “Business should be fun and you should always have a message when you talk to your troops. It’s a business war–global competition.”
Clayton, the new CEO of Frontier Corp., was working at Thomson Consumer Electronics Inc. in Indianapolis when he staged the event to send a message to his competitors and his sales staff.
Frontier officials and stockholders hope Clayton can direct Frontier over its domestic competition in the telecommunications industry and lead it back from a sluggish performance over the last year. He was hired June 16 by Frontier as president and chief operating officer. He became CEO two months later.
Clayton, also acting executive vice president of marketing, came to Frontier from Thomson where he worked as executive vice president for marketing sales for the Americas and Asia. He was the highest-ranking officer in both regions, and reported directly to the corporate chairman in Paris.
He worked 24 years selling and promoting the RCA brand, first with RCA Corp., and then for General Electric Co. and Thomson following acquisitions. Under his watch, Thomson America doubled its revenues and became a $5 billion-a-year business–Thomson SA’s only profitable division.
The tank tale and similar actions won Clayton a bigger-than-life reputation in the fast-moving consumer-electronics business.
“He is a legend in the consumer-electronics industry,” says Gary Shapiro, president of the Consumer Electronics Manufacturers Association. “The day he got the job at Frontier, I went out and bought stock. I had never heard of Frontier, but I know what Joe Clayton can do.”
The tank vs. TV battle occurred after Clayton obtained a translation of a book co-written by the top executive of competitor Sony Corp. “It was so bigoted, a chest-beating type of approach, it made me mad,” he says. He rented a Patton tank and filled a field with his competitor’s products. A video crew filmed him crushing thousands of dollars worth of TVs.
Then he moved the tank to downtown Indianapolis.
“I had a big (sales) meeting the next day with the tank parked out front. I was dressed like Patton,” he says.
“I gave my pitch, read excerpts from the book, played the tank video, and the place went nuts. I swear we could have taken any hill,” Clayton says. “It was a hoot! I really had a lot of fun.”
Clayton, 47, beams when talking about marketing and competitive victories, such as introducing the digital satellite TV to a skeptical industry.
“I was the father of the industry,” he says. Industry experts say Clayton is not exaggerating–that he foresaw the potential market and seized it.
His options, if he wanted to rise to CEO in the consumer-electronics industry, were limited to foreign-owned corporations. “I’ve always represented RCA products and that has a very close link to heritage, history and innovation,” he says. “Competing against something I had been part of for 24 years really didn’t sit well with me.”
When he decided to leave consumer electronics in December for telecommun- ications, he entertained offers from several telecommunications firms, including AT&T Corp.
“The Frontier opportunity as an independent would give me the type of speed and flexibility that I could make something happen relatively quickly,” Clayton says.
He chose Frontier’s size and flexibility over facing a culture shift at a company such as AT&T or one of the regional Bell operating companies.
“The culture (at those companies) would have strangled me,” he said. “It would have limited the skills that make me tick.”
As a newcomer to the industry– though several ventures at Thomson did involve telecommunications–working with his predecessor Ronald Bittner also attracted him.
“It was very compelling to work with Ron. I didn’t get a chance to fulfill that,” he says. Bittner died Aug. 31, six months after undergoing emergency surgery to remove a brain tumor.
Clayton described their brief relationship as one of mentor and student or son. “I would take his counsel and make sure I wasn’t stepping on any land mines,” he says. “It was just too short of time. That I will miss greatly.”

Gaining a new outlook
Clayton’s fourth daughter, Molly Marie, was born July 8. Clayton, his wife, Jan, and five children moved into their new home in Mendon on Aug. 18.
With its horse farms and sprawling lots, Mendon reminds him of his native Kentucky, he says.
Clayton grew up in Louisville and graduated in 1971 with a dual major in economics and business administration from nearby Bellarmine College. A year later he obtained his MBA from Indiana University at Bloomington. He began his career with RCA in 1973 as a marketing associate in a select executive-training program.
Indianapolis officials give Clayton high marks for his community involvement.
“Joe was an enlightened and committed leader,” Mayor Stephen Goldsmith says. Clayton helped the company, his employees and the community.
Bellarmine honored him as its alumnus of the year in 1995. He served on the Indianapolis Chamber of Commerce, and chaired the dean’s advisory board of the Indiana University School of Business and the Consumer Electronics Group of the Electronic Industries Association.
Frontier’s new chief says he has virtually no hobbies, and any free time is spent with his family. A typical day off involves a family movie and a trip to an ice cream parlor. (In Indiana, he favored the local Dairy Queen.)
Living in the hoops hotbeds of Kentucky and Indiana, Clayton also developed a passion for basketball.
“I love college basketball,” he says. He has adopted St. Bonaventure University and Niagara University as his new teams.
After 24 years in one industry, Clayton has moved into telecommunications with renewed vigor, he says.
“It is almost like being reborn,” he says. “This has challenged me mentally and professionally. I am having more fun than you can imagine.”
He wakes up by 5:30 a.m. and arrives at Frontier’s headquarters by 7 a.m. Beyond his duties there, Clayton’s typical days include traveling to Frontier markets and subsidiaries across the country. He often does not return home until 11 p.m.
“I am so focused on this business, I have missed the Victor exit more times than I can count,” he says. “I get up in the morning, and I can’t remember if I washed my hair (in the shower) because I’m thinking so hard. Those are very positive signs.”
Clayton acknowledges he can be a tough taskmaster.
“I set ambitious goals and hold people accountable. I’m very demanding on people,” he says. His nickname, begun at RCA, is “Make-the-Month Clayton.”
“It’s a philosophy I have had all my life. I understand there are hurricanes, typhoons and tornadoes. I understand there are exceptions,” he says. “If you miss two in a row, that is a trend. It is a problem.”
That focus on meeting sales goals comes from two aspects of his personality: structure and competitiveness.
“I want to compete,” he says. “I want to know what the score is all the time.”
Randal Simonetti, vice president of communications, says Clayton mentors sales and marketing staff on how to make the operation smoother, and meet those goals.

Getting to work
Clayton’s first activity at Frontier was to visit all Frontier facilities, employees and customers. He then quickly began to implement changes.
“If they wanted status quo, they got the wrong guy,” he says.
He already has restructured Frontier’s marketing organization, creating a central marketing department that covers all of Frontier’s products.
“There wasn’t a marketing organization. In the old days there wasn’t a need for one,” he says.
Clayton now is working to realign the sales organization and change its selling philosophy.
“We are moving more toward a more consultative approach where the salesmen own the (business) customers.” Frontier also will have dedicated customer-service representatives for large customers.
Clayton’s goal is to double Frontier’s revenues from $2.5 billion to $5 billion. He did it at Thomson.
“It will be more difficult here. I had some technological innovations there. I’m looking at a three- to four-year time frame,” he says.
The first step is returning the company to the double-digit growth it saw until last December. He plans to do it by developing better product offerings. He also plans to double sales productivity, primarily by changing the target to business customers.
“Some other people (at Frontier) probably think we are moving at lightspeed,” he says. “We are still not hitting on all cylinders yet.”
He plans to speed up everything: customer service, selling, product development, deployment of the new network and rolling out local-telephone service, he says. He calls it the “Double F”– fast and focused.
“Trying to get a herd of turtles all moving in the same direction sometimes is not the easiest thing to do. (The challenge is to) get them focused in the right direction and turn those turtles into jackrabbits,” he says.
Clayton expects to relinquish one title and hire an executive vice president of marketing in the next 30 to 60 days. He wants a “bookend”–an experienced marketing professional from outside the telecommunications industry.
“I will never take my hands (completely) out of marketing. That’s what I love to do,” he says. “I’m a hands-on guy. I want my fingerprints all over it.”
Bittner’s vision for the company remains mostly intact, and he approved all of Clayton’s changes so far.
“Most of that (CEO) stuff is in pretty good shape,” he says. “We need to be much more adept at executing.”
Frontier will focus on the business-to- business category and local-telephone service. The company expects to reach 1 million customers next month.
“One million customers cannot be wrong about Frontier service,” he says. Clayton and his staff have segmented the market by business volume and will dedicate increasing staff to bigger customers. The company also plans to target a half-dozen industry segments such as retailing.
“We can’t compete on a national or all-consumer basis with AT&T or Sprint (Corp.),” he says. “But we can bundle our products better than anyone else.”
Frontier can customize its products and can offer a better level of service–an industry shortcoming, he says.

Trying to mold the future
As for the company’s headquarters, Clayton says the community can forget any concerns that Frontier might leave its Rochester roots.
“Absolutely not. Exactly the opposite,” he says. “I am moving senior management to Rochester. I need the top management where I am.” With the exception of sales executives, other leaders will move to Rochester instead of being located across the country.
Clayton cannot, however, speak as definitely about Frontier remaining independent.
“I never thought RCA would ever be sold. I never thought GE would be sold to the French,” he says.
“I would like to tell you I know exactly what will happen,” he says. “You can never know.”
His goal is to get the company up to speed so it can again look to acquire other companies.
Changing Frontier’s philosophy from a regulated local-telephone company to a customer-driven, all-distance company remains a big challenge for Clayton.
A traditional monopoly telephone company looks at a new service, determines what it will cost to provide it and then dictates a price. A customer-driven company starts at the opposite end with what the consumer will pay and then works backward.
“That is a totally different philosophy,” he says. “That’s what I mean by being customer-driven.”
His efforts include unifying all the companies and subsidiaries under the Frontier name.
“We are one corporation. Sometimes we think of ourselves as a little local telephone company. We have to think bigger,” he says. “You know how many companies want to grow up and be a $2.5 billion corporation.”
Those efforts have met some–not unexpected–resistance.
“Most people are thirsty for leadership,” he says. Some facilities, such as Schneider Communications Inc. in Green Bay, Wis., where the old name remains on the buildings, resist.
“You might see (the signs) once, but you won’t see them twice. The next time I’m back, they will be down,” he says. “I have given everybody six months to change over. I’m going to force it.”
Frontier took “too paternalistic of an approach” in melding acquisitions into the company, Clayton says.
“It took too long to get at the real issues,” he says. “We are going to make sure all the acquisitions are fully consolidated.”

Unifying the troops
Clayton also wants to unify all employees behind objectives built on quality service to its customers.
Every Frontier employee will soon carry a card that outlines its seven corporate objectives, and all employees, even Clayton, will be evaluated by meeting those objectives.
“Many manufacturers and service companies have quality. I maintain you won’t find that in most telecommunications companies,” he says. “That can be a differentiating factor for us.”
One of Clayton’s focuses is on improving Frontier’s culture.
“We have lost too many good employees,” he says. “When you join Frontier, that’s a place you want to work and stay.
“That’s one of the things wrong with American business today. We have basically thrown loyalty out whether you are an employee or in management,” he says.
CEMA’s Shapiro says Frontier’s employees and shareholders will find Clayton intense and committed to the company and them.
“He knows how to create loyalty and has an ability to motivate,” Shapiro says. He also expects Clayton to develop alliances and partnerships with a variety of companies.
“He will look at things from a different perspective. Joe is a bright guy. He understands what brand name means,” Shapiro says.
Clayton built a reputation at Thomson for building alliances and deals that crossed industries and sectors, for example, with Compaq Computer Corp. to create PC Theatre and Internet services with Oracle Corp.
His best deal, however, involved the former Hoosier Dome in Indianapolis, he says. It was part of his “3-D vision”– the dogs, the dish and the dome. He worked with city officials to rename the facility the RCA Dome.
“It was the best deal I ever cut,” he says. He brought in a specialist so the RCA logo appears in virtually every TV camera angle.
Likewise, he used some advertising experts to bring back Nipper and introduce Chipper. They held a naming contest for the new RCA dogs and the winner was announced on “Entertainment Tonight.” “It has worked,” he says. “I would go to a trade show and see my competitors in line to have their pictures taken with the dogs.”
Simonetti, who directs some aspects of Frontier marketing such as sports marketing, calls Clayton a master merchandiser.
“(It) is something we don’t do in our industry to the degree we need to do. I have a whole new appreciation for it,” he says. “We have a new expression here: “If the logo looks a little too big, make it bigger.”’
Clayton’s third D, the dish or the RCA Digital Satellite System, was the most successful product introduction in the history of consumer electronics with more than 1 million units sold in less than 10 months.
As Clayton heads into his task of speeding up Frontier, the sales meetings at least should not be boring. “I always try to have something fairly creative,” he says. Themes have included “Jurassic Park,” video raps and Clayton making a black-and-white video appearance as Knute Rockne urging his charges to victory.
One of his best motivational presentations occurred in 1994 as RCA prepared to roll out the satellite system nationally, he says. The orbiting communications satellite had been launched into space in December 1993.
Clayton used footage from the launch and then brought in a video crew. At the sales meeting, after showing the launch, Clayton appeared on the video.
“I came out of the capsule after the separation and placed a big RCA logo on the satellite,” he says. After the video ended, smoke billowed from the floor and Clayton walked out in a space suit with a big RCA logo on the helmet.
“People relate to that and it puts a little humanity back into the senior executive,” he says. “We can have a little fun, but there is always a message. I guess I am a little bit of a showboat.”
And Clayton knows it is now show time.
“I wanted to be a CEO of a major corporation (since college),” he says. “I trained all my life for a shot like this. I am going to make the most of it. It is time for me to perform.”


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