The Art of IT: Tough Times at the Top
June 29, 2006
In an industry that experiences as much churn and innovation as ours does, I'm always amazed at the tenure of many CEOs: 10-year runs are common. Much of that longevity stems from the fact that many sitting CEOs founded their companies. But it struck me, as I read that Novell's board had fired Jack Messman, that we've seen something of a sea change in the leadership of our industry's top companies.
The CEO Shuffle
HP's ouster of Carli Fiorina last year started an exodus of chief executives, whether through unceremonious firings or as part of an orchestrated transfer of power. This April, Scott McNealy stepped aside at Sun in favor of Jonathan Schwartz. A few weeks ago, Bill Gates announced his retirement plans. At Cisco, John Chambers was elevated to board chairman as John Morgridge is set to retire; the move is seen largely as a precursor to Chambers giving up the CEO post. Adaptec CEO Robert Stephens retired after nine years. And then there was Messman's firing in late June.
While the circumstances for all these departures, retirements, planned successions and management shakeups vary, there's a pattern. With the possible exception of Adaptec, all of these companies are facing, or have faced, substantial challenges to their core business. Microsoft's challenge is perhaps the most studied these days. It faces the rise of Software as a Service, as led by now-archrival Google. Historically Microsoft has been able to enter almost any new software market by hiring twice as many engineers as all competitors combined and then giving them enough time to copy--and eventually one-up--the competition. That strategy isn't working with Google. I'm not suggesting Gates doesn't have the stomach for this fight, but certainly it's wise to let others do battle if his heart now lies with his charitable foundation.
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