CEO Turnover: From Watch to Oust
The Season of Boardroom Shakeups
Throw out the first ceremonial board pitch. Let the compensation pigskins fly. CEO turnover season is officially here.
The resignation of Gary Forsee, the now former CEO of Sprint, signals that rare time of year when boards convene to “assess” their CEO leadership. Proxies are being drafted, rewritten, and for a chosen few, axes are being polished. If you listen closely between October and December, that low hum you hear? It’s the scuttlebutt of who’s on the way out and who’s lining up to take their place.
Sprint’s Misstep and Motorola’s Dilemma
Forsee’s departure followed a board decision to publicly announce their search for a new candidate—a bold move that might not be the best way forward. Then again, maybe they’ll find what they’re looking for. Nobody knows, except the board—who now appears to be running the company themselves. And that’s never good news.
In the same sector, all eyes are on Ed Zander at Motorola. While the context differs from Sprint, the core dilemma remains: Can stakeholders trust that the current CEO’s leadership will drive meaningful growth over the next five years? Often, the surface answer is “no.” But boards shouldn’t be making quick calls in a vacuum. Their job is to think long-term and look outward, not act on inward personal agendas.
From Watch List to Oust List: Who’s Next?
There are other notable names dancing the line from watch to oust:
Patricia Russo at Lucent/Alcatel
Stanley O’Neal at Merrill Lynch
Charles Prince at Citigroup
Both O’Neal and Prince are under fire for recent billion-dollar credit market losses. Bad risk is bad risk—we get it. But that doesn’t justify poor judgment. Neither leader provided adequate proactive or even reactive guidance. In Prince’s case, the errors piled up, sparking serious doubts about his decision-making.
Public Endorsements During Crisis? Beware.
And while it’s charming to see a Saudi Prince publicly endorse his fellow Prince—yes, the one at Citigroup—as reported in The Wall Street Journal, the move rings hollow. It’s the corporate equivalent of Yankees owner George Steinbrenner declaring, “Joe Torre is our man.” Public endorsements during a crisis are rarely a good omen. History has shown us: be very wary. The outcomes usually aren’t pretty.