Professional Documents
Culture Documents
- FOR -
Internal Factors
Environmental
Management Organizational
and Employees Legitimacy
Before we get into the complexity of the actual topic, let’s take a minute to review this:
Happy Family
Successful Doctor
To
o
sim
pl
ist Drug, Alcohol addicted College
ic dropout
Parents Role:
• Provide an optimal environment
• Provide guidance, direction, assistance Inspiring Navy Seal passionate about
• Instill vision and a sense of purpose his country
• Support and motivate each child
• Execute Discipline (Monitoring)
Can Companies be categorized? Can CEOs be categorized?
Placeholder:
Walt to blend it better with
What are the odds this would have worked?
Attack our argument – Square Peg
in a Round hole
Fortification
Genesis
John Sculley Tim Cook
Why, after they fail, can people of less training, skill and intelligence turn their
failures into successes?
Léo Apotheker Meg Whitman
The CEO of PepsiCo during the "Cola wars" of the early 1980s, Sculley was famously lured to Apple in 1983 with
Steve Jobs' pitch "do you want to sell sugared water for the rest of your life? Or do you want to come with me and
change the world?“
an upstart company bringing in a veteran CEO to oversee its young, inexperienced founders.
John Sculley came to Apple in order to apply his "Pepsi Challenge"-era marketing wizardry to the computer
business, while also giving the company some experience and veteran expertise.
All of Sculley's successes during that time were Jobs' ideas before leaving the company, Sculley admitted. "All the
design ideas were clearly Steve's. The one who should really be given credit for all that stuff while I was there is
really Steve.“
HP lost $30 billion in market cap over his first 10 months of tenure, when he was asked to leave
> Just four members of the HP board bothered interviewing Apotheker before bringing him on board, none of the
board member ever met him in person.
the board that hired a CEO without so much due diligence as a handshake?
> Most of the board was here and voted for this deal, and we feel terribly about that – Meg Whitman
> Autonomy executive fudged the company’s numbers during the acquisition to artificially inflate its value.
Hewlett-Packard Lost Billions on Sketchy Buyout of Autonomy, the British software company it acquired
for $9.7 billion.
iPhone killed Nokia or did it?
“we didn’t do anything wrong, but somehow, we lost” ~ Nokia CEO, Stephen Elop
Nokia had been a respectable company and they didn’t do anything wrong inside of their business, however the world
changed too fast for them. Their opponents had become too powerful.
This video-rental chain survived the transition from VHS to DVD just fine—but then failed to adapt to the next big
change.
Blockbuster remained flat-footed when Netflix started sending videos through the mail, cable and phone companies
started offering video-on-demand, and Redbox started renting videos for a buck a night through vending machines.
Now that video streams through computers and phones, Blockbuster's conventional retail outlets seem hopelessly
outdated.
When Web search and aggregation were still virgin territory, the pioneering Yahoo tried to charge for services like E-
mail and file sharing, while upstart Google offered everything for free.
Yahoo's snub of a $45 billion buyout offer from Microsoft in 2008 looked like a huge gaffe, when Yahoo's market
value had fallen to a scant $19 billion or so in 2010
fixated on what made them successful and failed to notice when something new was displacing it. ~Nokia,
Blockbuster
focused purely on the marketplace of today and failed to anticipate the future. ~Yahoo
The CEO Effect
Variance decomposition analysis is often used to examine the degree to which CEOs influence their companies’
performance (the so-called CEO effect).
Author, Markus Fitza in his paper argued that previous studies have an important underlying flaw. Empirically, these
studies wrongly attribute the performance effect of randomness—of chance—to the CEO.
Most past variance decomposition studies show a CEO effect between 13 and 30 percent, indicating that CEOs do have
some influence. given relatively short average CEO tenures, every CEO has only a limited time to influence a firm, and
the disturbance created by randomness is more pronounced if we analyze short time windows.
Therefore, the only part of the measured CEO effect that can be statistically significantly attributed to leadership is 5.0
percent. Independent of the average tenure in any of my samples, results when corrected in this way indicate that the
effect CEOs have on company performance that can clearly be distinguished from the effect of chance is between 3.9
and 5.0 percent
"It is part of the CEO's job to be that scapegoat when the time comes,"
You can't tell how great a CEO is by looking at her CEO effect
Ultimately, his study showed that chance would produce an average CEO effect of 13.3 percent, generally ranging between
12.8 percent and 13.8 percent. His calculation for traditional CEO effect was 18.8 percent--about five percent higher.
Apple: Genesis (under Steve Jobs), Fortification & Attack (under Tim Cook)
Mary Barra:
Barra demonstrated some of the most crucial traits of FORTIFICATION CEO, focusing on increasing
operational efficiencies, cutting down bureaucracy, and bringing order to chaos
Barra’s transition to ATTACK CEO mode arguably began nine months into her tenure, when she face the
Chevrolet Cobalt ignition-failure scandal head on, owning the issue and using it as a way to transform the
decision-making process within the company.
three years after Barra took the helm, she is credited with changing GM from a slow-moving, bureaucratic giant
to a nimble disruptor—she has been operating effectively as a GENESIS CEO. One of Barra’s most notable
accomplishments has been the development of the world’s first truly affordable, long-range electric car.