My pick for winner of this year’s Worst CEO is (drum roll, please) the team of Jim Balsillie and Michael Lazaridis—co-CEOs of Blackberry maker Research in Motion.
While they may appear to be an obvious choice, it wasn’t an easy one.
Among large companies, Research in Motion’s stock isn’t the biggest loser (though it’s not far from it), the company is still making money (though its growth has tumbled) and like most of those contenders: there was a time not that long ago Balsillie and Lazaridis might have been hailed as the best CEOs.
For this year’s crop of contenders, I started by seeking suggestions from Twitter, Facebook, Google+ and old-fashioned email.
Not surprisingly, among those receiving the most votes were those no longer in their jobs—like MF Global’s Jon Corzine, Hewlett Packard’s Leo Apotheker and Yahoo’s Carol Bartz.
There were plenty of others mentioned, including Groupon’s Andrew Mason (not on the job long enough, though definitely facing a daunting dance); BofA's Brian Moynihan (his is inherited—jury is still out whether he should take the hit) and Tom Wilson of Allstate (the biggest write-in campaign, by far; but it was a concerted effort by organized disgruntled agents..).
John Chambers of Cisco also picked up a few votes, but the last quarter gives him a temporary stay, as does its bouncing stock.
Based exclusively on the numbers, Nokia’s Stephen Elop deserves to be on the list, but I held off because he’s been on the job only 15 months—and when he took charge the company was already in what appeared to be an irreversible decline.
That leaves the top (or bottom, depending on your perspective) five:
Number 5: Brian Dunn, Best Buy .
Hard to put an up-from-the-ranks “blue shirt” on the list, but Dunn is in a tough spot.
There is little doubt he has worked hard in a tumultuous time. With Circuit City gone, however, Best Buy should have had clear sailing. But the company appears to have misjudged its growing, uninvited role as the “showroom for Amazon,” just as consumer PC-buying patterns and tastes changed.
Even an on-site, Apple-staffed Apple kiosk hasn’t appeared to have helped, nor has the bursting of the flat TV boom. (The TV business has since turned largely into a replacement business—not good when a big part of your business is TVs.)
These are the kinds of challenges that test leadership, and based on the stock price and negative growth, Best Buy has neither articulated nor executed on a strategy that appears to be working.
Number 4: Antonio Perez, Eastman Kodak.
Perez has been CEO of Kodak since 2005. Since then the stock has lost about 97 percent of its value.
This year alone its share price has fallen by around 84 percent.
Perez’s claim-to-fame is launching a well-received ink-jet printer to go up, an industry dominated by Hewlett Packard, in pursuit of an imminent turnaround that has never happened.
Perez’s last hope has been to sell the company’s patent business for a big number.
But even that appears to be uncertain.
Reality: He hasn’t executed.
Number 3: Andrea Jung, Avon.
When I saw the news that Avon CEO Andrea Jung was being kicked out as CEO, but keep her job as chairman, I screamed to myself: “NO!” She was already on my list.
Good news, she’ll keep the job until she finds a replacement, which keeps her on the list.
How she has kept the job this long is unclear. She has been CEO since 2001, and based on our calculations, the best compensated CEO on this list and Brian Sullivan’s Best CEO list.
After a fast start, with the stock performing—with her getting the accolades she deserved at the time—the company’s performance since 2004 has been uneven and unenviable.
Her spot on this list was sealed after last quarter when the company announced it was embarking on a long-overdue review of itself.
Things had become so bad that one analyst dared ask on the earnings call—for all to hear: “Why should investors believe management and the board has any control over the business at this point? And I guess, Andrea, you're chairman.
Given an average board tenure of over 10 years, I believe, how long can the status quo here remain?” Another, clearly frustrated, added: “It strikes me that you, guys are so totally screwed up in so many ways.” Enough said.
Number 2: Reed Hastings, Netflix.
If readers and viewers could pick, Reed Hastings would be anointed worst CEO. Customers simply hated the blunder of all blunders—when the company attempted to splits its DVD and streaming business into two separate entities, naming the DVD business Qwiskster.
The news sent the stock into a tailspin, with Netlfix shares off around 60 percent for the year—70 percent from its highs.
Still, sales and earnings growth, as of last quarter, continued to show growth. The big question is what happens, as the company has forecasted will happen, subscriber growth falls?
Until this latest round of bad will, Hastings was everything an entrepreneur could aspire to be: Somebody who made the transition from disruptive startup to Wall Street wonder with seemingly flawless execution.
My take is that as bad as this year has been for Netlfix customers and investors, the company (and story) remains in transition. If Hastings can’t execute out of this either by selling the company or turning it around, he may very well be next year’s winner.
Number 1: Balsillie and Lazaridis, Research in Motion.
The company's troubles started several years ago, when it apparently misjudged the impact of Apple’s iPhone and then Google’s Android operating system.
I’d go so far as to say they stumbled on two significant counts: 1) Underestimating how consumers would drive the iPhone and Android into once-Blackberry-devoted corporations and 2) foot-dragging on a fast browser and sleeker operating system.
Not sure which came first, but either way, they executed the loss of market leadership with impressive speed. This may go down as a classic case of getting blindsided by something that wasn’t even really that disruptive, just better. (And we’re talking not just one person screwing this up, but two!)
To some extent, this has been the year of comedy of errors for the duo, starting with Lazaridis storming out of a BBC interview, when he was asked a question he didn’t like.
It went downhill from there, with outages after outages, the botched Playbook (which the company couldn’t give away) and then getting in hot water for giving its newest operating system, which (from the too little, too late department) is likely to be irrelevant no matter how good it may be, a name used by another company. For more on the company’s blunders, Canadian Business had somewhat of a field day.
Adding insult to injury: RIMs stock this year is off around 75 percent, and all its key operating metrics are either declining or negative.
For these reasons, and more, Messrs. Balsillie and Lazardis: Congratulations on a job not well done.
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