GO
Loading...

» more from Leadership

6. Al Dunlap

Picked by the board of Scott Paper Co. as the man to turn the struggling company around, Dunlap earned his nickname “Chainsaw Al” by ­slicing 11,000 employees. When Scott merged with Kimberly-Clark, Dunlap’s payoff was estimated at more than $100 million.

Dunlap’s memoir/manifesto, Mean Business, roughly coincided with his next CEO star turn, which was also to be his last. Sunbeam’s stock surged on the news that the Chainsaw was coming; massive workforce reductions and factory closures followed within months. His book clearly explained what set him apart from “addle-brained” and “weak” executives: “I’m a superstar in my field,” he wrote.

Could there be a clearer sell signal? Unable to flip Sunbeam to a new buyer, as he’d done with Scott, Dunlap was stuck actually running the company. He failed spectacularly. Within two miserable years, the board fired him. The tactics he’d used to stave off losses—the company overstated its net income by $60 million, which was real money back then—earned him a civil suit from the SEC and a class-action suit by shareholders. Dunlap eventually settled both and was barred from serving as an officer or director of any public company. You could call Chainsaw Al’s story a fall from grace, but in his case, that’s probably not the proper word.

By Portfolio.com