J.P. Donlon

J.P. Donlon is Editor Emeritus of Chief Executive magazine.

Thirty Years On

September 2007 marks the 70th anniversary of J.R.R. Tolkien's The Hobbit and the creation of Middle Earth, the 50th anniversary of the Treaty of Rome when the path to European integration formally began, and the 40th anniversary of the release of Jimi Hendrix's seminal album "Are You Experienced?" It also marks the 30th anniversary of the magazine you now hold in your hands.

Over the past one score and 10 years in its 228 issues, Chief Executive has hosted well over 160 CEO roundtables and forums, celebrated 22 Chief Executives of the Year, and featured on its covers presidents of the U.S. (Carter and Reagan), as well as presidents or prime ministers of Britain (Thatcher), France (Mitterrand), Sweden, Mexico (de la Madrid), Japan (Nakasone), India (Gandhi), Singapore (Goh), and the Czech Republic (Klaus)-not to mention pivotal political figures as diverse as Alexander Haig, Sheikh Yamani and reformist St. Petersburg mayor Anatoly Sobchak.

CE has also tracked issues with which CEOs have grappled. In our salad days, bosses seemed obsessed by the competitive threat posed by Japan Inc. only to see it virtually disappear by the late 1990s. TQM, Just-in-Time and the Malcolm Baldrige Award were common bywords. Leveraged buyouts (LBOs), all the rage in the 1980s, have metastasized into private equity.

Concern over the rising cost of health care is another matter. Three decades ago, leaders worried that the national health spend, as a percent of GDP, would soon exceed 10 percent of GDP. Today, leaders would only be too thrilled if it could be held to 17 percent. (No chance.) Similarly, few could even spell corporate governance let alone figure out what it meant. Boards of directors, as the joke went at the time, were to be treated like mushrooms: kept in the dark and heaped with fertilizer.

The core responsibilities of the CEO haven't changed, of course, although with the rise of globalization and advances in communication technology, how CEOs do their jobs has altered noticeably. The biggest change we see is that trust in leadership generally has faltered. It's not just institutional shareholders and international markets that are less forgiving. CEOs today do not have the margin of error that their antecedents enjoyed as recently as 10 years ago. This is reflected in the shortened tenure and more rapid turnover at the top. In 1985, at one of CE's earliest roundtables discussing the impact of hostile takeovers, Carl Icahn quipped to the CEOs around the table, "If you want a friend, get a dog."

The CEO doesn't have a dog's life, far from it. But there are definitely more fleas to contend with.

Sincerity Is an Overrated Virtue

Last year Toby Young a British journalist, son of a Labour life peer and the author of How to Lose Friends and Alienate People related an anecdote in London's Spectator about a friend of his who works for a large multinational corporation who traded in his car for a Toyota Prius. This self-consciously eco-friendly consumer choice had the desired effect of boosting the fellow's social status among his peers. But as it turned out the fellow's girlfriend was so annoyed at his not getting a BMW, or better a Porsche, that the friend ended up getting her a Mini Cooper as consolation. The fact that he actually increased his so-called carbon footprint has not prevented him from lording it over the less enlightened. Young also noted wryly that the friend, who announced his intention to take his girlfriend to Bhutan for mountain-top contemplation to celebrate New Year's Eve, didn't intend to travel there by land.

Such examples litter our social landscape. No doubt you know of friends or colleagues who act the same way. This goes back to a basic tenet of how people operate in a dubious moral philosophy. Is it about practical results or about your intentions?  Today, it is de rigueur to espouse the environmental cause in all things.  To paraphrase Richard Nixon, we are all global warmers now.

But surely if one's actions don't lead to one's intentions, namely an overall reduction in the level of carbon emissions, one's moral superiority is based on very little?  Well, apparently not if you' re Al Gore as reports about the mega-energy consumption of his home in Tennessee would attest. No, being green is more often an assertion of one's social status or a testament of religious orthodoxy. Sincerity and purity of purpose trumps everything.

This came home recently when we met Patrick Moore, the affable Canadian-born co-founder of Greenpeace who now chairs Greenspirit Strategies Ltd., a firm he founded to help advance real reductions in carbon emissions through practical measures. In his early days as an environmentalist Moore was opposed to nuclear energy. Around 2000 he had-well if not an epiphany-the beginnings of a gradual conversion. "While energy conservation, together with such renewables as wind, hydro and geo exchange (ground source heat pumps) will play a growing role in mitigating greenhouse gas emissions, they alone cannot provide electrical power for a rapidly industrializing world," he recalls.

Shortly thereafter in an op-ed in the Miami Herald, he came out of the closet to say the "N" word:  "Nuclear energy is part of the solution."

Quelle horror!

The gasps from the green ecclesiasts echoed from the base of the Grand Canyon to the halls of The Sierra Club.

Yet Moore is unapologetic. He also co-chairs with former New Jersey governor Christie Todd Whitman the Clean and Safe Energy Coalition, (www.CleanSafeEnergy.org)  CASEnergy is a group that works to unite unlikely allies across the business, environmental, academic, consumer and labor community to support nuclear energy.

Moore says he is not alone among environmentalists as one might think. He points to fellow green activists such as Stewart Brand the founder of the Whole Earth Catalog, Jared Diamond, the Pulitzer prize winning author of "Guns, Germs and Steel" and Tim Flannery, Australia's acclaimed scientist and conservationist, who have all come around in their thinking about nuclear energy. 

Moore isn't surprised that most activist groups who consider themselves at the forefront of the fight against global warming nonetheless oppose the only nongreenhouse gas emitting power source. "Most people in the environmental movement are not independent of their organizations." He says. "They must tow the party line. Within groups like the NRDC and the Sierra Club there are people who question their organization's anti-nuclear policies, but they are not free to speak their minds if they want to keep their jobs. Groups such as these have spent so much time and money educating their groups into thinking that nuclear energy is evil that to shift their position would risk losing half their membership not to mention their funding.

"But as time goes on the logic has to emerge. It's simply illogical to claim that climate change is the most important issue and that reducing fossil fuel consumption is the main aim and yet be against the most important technology that accomplishes that."

At present no other technology offsets as much carbon emissions today as nuclear technology. Presently 20 percent of the present electrical supply comes from nuclear. If it wasn't available what would we use to produce it? No doubt we would be forced to rely on coal and gas. But the history of the environmental movement is less about logic than it is about theological purity of belief.  "There is an unfortunate element of religious fervor and lack of logic." Moore adds. "How much sense does it make for the Sierra Club to be against nuclear energy when it is coal-fired plants that make the Grand Canyon filthy?"  Recently The Los Angeles Times editorialized that ��tax dollars are better spent on windmills than cooling towers.' In other words we should replace nuclear energy with wind power. This is simply not possible. There is a fundamental difference between constant and intermittent sources of power such as wind and solar. And reliable base-load sources such as hydro, fossil and nuclear."

According to the U.S. Department of Energy the U.S. will need 45 percent more electricity by 2030. Where will this come from? Hydro is tapped out. Conservation and greater efficiencies in natural gas, coal and oil will help, but renewables such as solar, wind and geothermal will also help. But alone it will not be enough. Nuclear energy technology has advanced and the regulatory process has been greatly streamlined. It produces no pollutants and has the lowest production cost per kilowatt of electric power. Despite the fact that public opinion surveys show better than three-quarters of the public support building new nuclear facilities, opposition among the green Sanhedrin remains firm. Many leaders who make a claim on our attention to be taken seriously say that we don't need nuclear and that we can do it with wind and solar. This is not possible in the real world. You can't make the wind blow all the time or make the sun shine all the time.  Yet when matters of faith are concerned, sincerity is everything; facts are a nuisance.

Are Your Employees Engaged?

In their syndicated Dear Abby-like business column, Jack and Suzy Welch recently identified three areas that offer the best picture of a company's well-being: Employee engagement, customer satisfaction, and cash flow. Note that in the estimation of the former supremos of GE and the Harvard Business Review respectively, the finance element ranks third. In the dynamic duo's view these three indicators "won't tell you everything you need to know, but they get right to the guts of a company's overall performance."

"It goes without saying that no company, small or large, can win over the long run without energized employees who believe in the mission and understand how to achieve it," they add. No kidding. But sometimes the obvious isn't as obvious as one might suppose. And it's telling that a former CEO, someone once known by the unfortunate moniker "Neutron Jack" for eviscerating swaths of employees from the ranks of his company, reminds us that employee engagement is perhaps the most telling indicator of competitive advantage.

Recent research has surfaced that quantifies the difference employee engagement can make to the bottom line. ISR, a Chicago-based HR research and consulting firm, conducted a study of over 664,000 employees from 71 companies around the world.  Most dramatic among its findings was the almost 52 percent difference in one-year performance improvement in operating income between companies with highly engaged employees as compared to those companies with low engagement scores. High engagement companies improved 19.2 percent while low engagement companies declined 32.7 percent in operating income over the study period. The data covers financial performance through 2005 (www.isrinsight.com)

According to Soni Basi, senior project director at ISR, the study compared the degree to which employees were "committed to the mission and values of their company" with the company's financial performance over a given period. What exactly is meant by an engaged employee? "Engaged people are proud to work for the company," says Basi.  "They are committed to stay and put in the extra effort to facilitate the company's goals."

Other findings include a 13.2 percent improvement in net income growth over a one-year period for companies with high employee engagement, while seeing a 3.8 percent decline in net income over the same period for companies with low engagement. Companies with high engagement also show a 27.8 percent improvement in EPS growth, while companies with low engagement reported an 11.2 percent decline in EPS over the same period.

A previous ISR study of 41 companies over a period of 36 months from 2002 to 2004 revealed that the high engagement companies realized a 5.75 percent difference in operating margin and a 3.44 percent difference in net profit margin versus the low engagement companies.

The question remains how direct is the correlation? Are employees more engaged because the companies for which they work are doing better or do they perform better because the employees are committed? RBC Financial Group (formerly Royal Bank of Canada), for example, has been able to link employee commitment with higher levels of customer satisfaction and in some cases more deposits in its branches. By contrast Basi points to the newspaper industry where turmoil and industry consolidation have exacted a toll among employees. "We find in such cases that people might be very proud of the brand in the marketplace, but they might not be engaged any longer because they don't think that the company is heading in the right direction."

How strong is the commitment to manage human capital? In a separate survey of 100 companies around the world ISR found that 91 percent have measures that relate to human capital, 58 percent include such measures as part of their key performance indicators or business performance scorecard, but only 46 percent actively assess the value of human capital and its impact on business performance.

"Too many U.S. managers see employees as a cost as opposed to an asset, "says USC professor James O'Toole who authored along with Edward Lawler, "The New American Workplace," a seminal work that assesses workplace practices. O'Toole reckons that the difference between high and low engagement companies lies less with direct compensation than with such workplace concerns as freedom from arbitrary control, collaborative decision-making and a stake in the outcome.

Why do some have companies high involvement/highly engaged workforces while others do not? O'Toole points to leaders who take a very different view of the value of their employees. In the early 1980s, Harley-Davidson, having been organized on the adversarial model of GM and Ford was facing oblivion when Rich Teerlink stepped in as CEO. He promised his workforce he wouldn't outsource jobs as long as he got the productivity increases needed to be competitive. Companies such as Goldman Sachs, Deloitte Touche and UPS, he says, have customized  development models designed to nurture and encourage talent. When he founded Starbucks Howard Schultz, a self described former working stiff, was more interested in creating the right work environment for employees that he was in the price of coffee.

Workforce environments reflect the priorities and values of the organization's leaders. This represents an underutilized benchmark for judging CEO performance.

If you would like to speak out, please eMail me at: jpdonlon@chiefexecutive.net

Textron’s CEO Lewis Campbell: CEO Transform Thyself

Performance improvement is on every CEO's agenda and most reckon they have a clear idea about how best to pursue it. Details in the playbook may differ from company to company but the broad strokes are familiar to most leaders. Every now and then a CEO will reach a critical point in his or her career where he must decide whether or not to throw out the playbook and start again. But in doing so sometimes a leader must also re-examine the standard playbook in his own head-the assumptions, ideas and received truths that have filled his or her mind over many decades of experience that have served the leader well. After all, it's probably what brought him to the corner office in the first place.

A Duke University-trained mechanical engineer, Lewis Campbell, 60, joined Textron as EVP and COO in 1992 after a 24-year career at GM, where he held a number of key management positions including general manufacturing manager of GM's Rochester Products Division. A William Holden-type with glasses, the soft-spoken Winchester, VA, born executive sporting his trademark blue shirt looks the part. He became president in 1994 and CEO four years later. From the time he joined the company to a year after he became CEO he saw Textron's share price rise from 20 to 98. (The company is perhaps best known for its Bell Helicopter, Cessna Aircraft and E-Z Go golf carts as well as its role, along with Boeing, for producing the V-22 Osprey in addition to other specialized military vehicles.) But six quarters into what looked like a promising start as CEO, Campbell faced the perfect storm.


In May 1999, Textron shares fell nearly 70 percent from its 98 peak at about 24x current year earnings to around 30 in late 2001. Much of the decline was precipitated by poor capital allocation decisions that led to ill advised acquisitions of unfavorable industrial businesses. The company's EPS-focused business model that awarded quarterly accretion forced management to invest funds in acquisitions to avoid dilution. This was made worse by a collapse in the business jet market that sent Cessna into a nosedive. To make matters worse, over earning industrial businesses such as E-Z-Go, Jacobsen and Greenlee started to turn south. The operating income lost from these businesses alone represented an earnings drag of $0.60 a share. The downturn following 9/11 only made things worse. Many CEOs facing such a crisis would be content to fall back on their own experience. Campbell chose not to. Subordinates describe him as someone who has a willingness to learn new things and perhaps more importantly, to change himself.

As the granddaddy of conglomerates Textron was exhibiting business model fatigue. Each of its businesses was expected to meet its EPS targets and deliver a tribute to corporate.The operating companies were in their own orbits sharing little with one another. As he relates in the interview nearby, Campbell knew he had to change, but even he was unsure just how fundamental the transformation would prove to be. "I saw the ��movie' at GM and I was darned if I was going to sit through this again," he remembers.


The result is a company with a fundamentally different conception of itself. Gathering an inner core as his war cabinet, Campbell did away with the conglomerate and created an enterprise network where each unit had to create value and not be just a caretaker. Ruthless efficiencies were enforced. Eighteen hundred payroll systems were reduced to three; 154 healthcare options from 38 providers were replaced by one plan; and 88 data centers were reduced to two. But the transformation was more than another exercise in re-engineering. Campbell soon discovered that he had to change the way Textron people thought about themselves and to do this he started with himself. In adopting Six Sigma, for example, Campbell took the time to go through the rigorous training himself and in March 2006 earned his green belt.

"Lewis is good at switching off from relying on his experience and understanding when that experience might not be valid in specific circumstances," says Stuart Grief, Textron's VP of strategy and business development and a member of the transformation's leadership team. "Imagine what it's like to be left to your own devices for years and suddenly having an activist center. If you don't do it right, it will be perceived as gross intervention," adds Cessna CEO Jack Pelton.

R. Kerry Clark, president and CEO of Cardinal Health and former vice chairman of P&G's global family health business who has served on Textron's board for several years, says that Campbell engages the board in an open and transparent way that Clark finds both refreshing and instructive for his own board. "I particularly like the way he dialogues with members of his team. The worst thing one can do with bad news is not to share it. He'll say to an executive "that was courageous of you to bring this forward, let's talk about it." Also, when one of his own ideas doesn't work, he's frank about saying, "gee I messed up on that, didn't I?"


   Bell Helicopter's V-22 Osprey flying over Big Ben in London  

Although most of the internal heavy lifting is behind them, Campbell cautions that much work needs lies ahead. Among the tasks is a major, well-orchestrated multi-faceted brand improvement process that integrates all aspects of the brand name with Textron's disparate markets. "Some people still expect me to flinch," he says with an amused grin. For an organization once afraid of change, one that according to one executive would "freeze in the headlights at the prospect," today it has almost a "bring it on" attitude.


The Essential Epiphany

What it's like working every day in a "Harvard Business School" case study.

Before he could transform the company, Lewis Campbell had to transform himself.

The 60-year-old native of Winchester, VA, who became Textron's CEO in 1998, talks about why it became necessary and what he had to do to make it happen.

Why transform Textron?

In the 1990s, we acquired a lot of companies. At one point we had sold off $5 billion and had acquired $5 billion worth in revenues, and we were only a $10 billion company. Think about the turn! We were acquiring primarily private companies and bought them at pretty good prices because we were known as the "friendly acquirer." Over time this meant that we inherited many redundant functions such as payroll systems, benefit programs, data centers and research facilities. Our ability to create sustainable value was being eroded.

When I became CEO in July 1998 we enjoyed six successful quarters, but afterwards it was pretty darn obvious that our business model was no longer working. We didn't know why, because the earnings were still coming. Quarterly EPS year-to-year improvement when I came here was 8 or 9 percent, and at the peak it was 15 or 16 percent with no restructuring either. But too much of our EPS depended on acquisitions, and not enough on return on invested capital. We woke up. Our return on invested capital was not quite as good as it should have been. After a strategic offsite meeting with the board in September 2002 directors were asking the question, "Lewis, what is your vision of the company?" I said, "Well, I want to do this and this and this." They said that's not compelling and they were right.

As the board kept hammering me to deliver a vision for the company, I began writing one, but found it wasn't easy. Ultimately we want to be a premier multi-industry company recognized for its strong local brands, powerful enterprise processes and talented people.

We decided that our strategy was to develop a core competency-actually two core competencies: portfolio management and enterprise management-and to be recognized for it. Enterprise management was all about using the network enterprise and shared services. For example, at one time we had 88 data centers, we need 2; had 154 healthcare plans, we need one; we had 1,800 payroll systems, probably didn't need too many of those either.

What was the epiphany that gave you the solution to change the company from a disparate collection of businesses to an operationally integrated enterprise?

At the outset I had not a clue in the world what to do. Yes, I had some ideas, but I hadn't gone to the beach, like some guys do, to sit for 37 days until the inner light bulb turns on. We spent the next year and a half with our executive leadership team working through a foundation of transformation. We decided that we were going to have a network enterprise, one that would leverage the size of the company and become ruthlessly consistent without exception.

But the most surprising insight- something I should have figured out earlier-was that the secret weapon of transformation, the big lesson we had to learn, is that people really need to believe it's good for them, otherwise it will not be successful. As a CEO, I also came to understand that transformation has nothing to do with how "stupid" the organization is or about how "bad" the prior CEO was or about a particular planning process. It's really about me. I realized that I had some bad theories in my head that prevented me from being what I needed to be in the situation I found myself in. If I didn't change, I had no chance to win.

The real battle any CEO has is not only how well one does while in the job, but how well the company performs five years after one leaves. Look at companies who were on a great trajectory. The CEO retires, great guy follows him, boom, nothing happens in shareholder value for five years.

So if you ask what motivates me the most, it is creating a sustainable product development and reinvention process.

Now it's five years later from the day of my epiphany. Take our proxy statement, which tracks $100 invested in Textron on the last trading day of 2000 and compares it to the S&P 500 and our industry peers. This year we're up something like 180 percent. Our proxy peers are up maybe 20 percent, and the S&P is up five. It's a fabulous preliminary scorecard for the first five years. So now we think we've really got this figured out. But I'm scared to death because in transformation, success is not your friend.

In what way do you work with the board differently today than you had previously?

The challenge facing a new CEO dealing with the board is very interesting. You don't instantly appreciate how strong you have to be on the things you believe in, because you're talking with the group that's going to decide whether you stay or go and how much you get paid.

When I first became CEO, I didn't know how to transform myself. I had to undo many things I had spoken so passionately about in the '90s. I never said, "Well, I was just following that dumb' guy's [former CEO Jim Hardymon's] orders," because we were on the same page. It's tricky for a new guy because at the start you're not standing on the strongest platform, not knowing where the bottom is, and you're trying to convince your owners and your ultimate guardians of shareholder value what you are going to do and why it'll succeed. So you better be passionate about it. In retrospect, I was too timid. A couple of board members had pulled me aside at the time and said, "Lewis, how much do you believe in this?" I said, "Are you kidding me? I've got my whole life wrapped up in this thing." They said, "If you know what has to be done, just do it. We'll either support you or we won't."

The other thing that changed is how we involved the board after a few members reached mandatory retirement allowing new members to join.

Together we decided on a cross section of talented people to join because I needed help on certain issues. If there's an expert on the board, I dispatch him to a unit either in trouble or in need of a different opinion. The director is my internal consultant. They report to the board on whatever they learn, which may prove unflattering to me.

You're okay with that?

If you're going to transform a company and you have somebody who has the brains to help, yeah, you have to be. The old me wouldn't have been. In essence, your fear sets you free because if the board knows you're doing that, what are they going to do? Strangle me because I sent a board member out and he comes back with a bad story? No. Now that we know the bad story, they pay me to fix it.

So is the transformation really making a difference?

Here's a great set of numbers for you. Cessna hit a peak delivery volume of 313 in 2001 with a margin of 13 percent, with a return on invested capital in the 20s. Pretty good business. At about 300 planes delivered, they'll have between 35 and 40 percent return on invested capital today. Think about it. That's a money machine. It'll generate as much cash this year as we paid for them in '92.

Now that you've integrated the businesses and achieved operational efficiencies what new things can we expect?

Now that we have accurately defined all the value streams-they number in the hundreds-we have prioritized them and have created a scoring system to measure how well the organization is migrating toward them. It's never perfect, but, if one thinks in terms of attaining bronze, silver or gold, we strive to be at the gold level with the majority of our value streams by the end of 2008.

Does this mean you're going to introduce Textron as a brand?

We are debating that heavily. The problem with that is, we're more a house of brands. So it's Cessna, a Textron company. How the Textron piece figures in this is unfolding, but if Textron had the right reputation, it would also carry some brand aura into Cessna. Right now, for many customers, it doesn't.

How sustainable is your transformation?

That's the big question. To be a premier multi-industry company you have to double in value every five years, probably for a 20-year period. For the first five years we're within an eyelash of being on target. But we have got to do it again and again and again. That's one measure. We also have to figure out how and when we begin acquiring because eventually, we're going to have to add to our mix, and there don't appear to be many bargain opportunities presently.

There are some multi-industry companies that have done well over a long period of time. Although it's been having a pretty rough patch recently, GE is a good example. Size matters. But size in and of itself can also be a hindrance. You have to grow carefully.

How do you cultivate leadership three to five levels below the CEO?

We do a twice-a-year review. A mid-year "how you are doing, what do you need to do better" review is followed by an end-of-year "here's how you did" and "what are your objectives for next year" assessment. Every September, I take to the board a clear system-produced summary that allows the board to view at least 200 executives. They're scored on two things: their performance in their current job and their capability to perform in the future needs of transformation.

We understand that a company is only as good as its leadership teams. We engage the Center for Creative Leadership and use some of its processes to improve the way teams work together. In addition, we're thinking of launching Textron University over the next year or so, which will be a virtual university that will, among things, deliver Six Sigma. It will be run by an internal board of leaders within the company who will decide what courses ought to be taught. It will help address certain weaknesses in our skills by helping to bring people up to speed.

How often do board members actually get to see some of these people in situ-not just when they make presentations at board meetings when everyone's on his best behavior?

At least one of our six board meetings is devoted to a business unit where we showcase executives. It's not going to a conference room and listening to the CFO or whatever. We're interacting with men and women that are doing all sorts of things. We tell the board to watch a Mary Jones or a Peter Smith because they are the future in their respective organization.

We have a second venue, which we affectionately call our pit, where we pick 10 to 14 high potential people from various levels and invite them to attend a board dinner. These folks are spread out amongst the tables. From the board's perspective they could be anybody.

For middle to higher-level folks, we organize social events, usually a sporting event; for example, a three day bird shoot in South Carolina. We invite board members; some go, some don't. Have you been to a bird hunt? Where we go, two people go off on a jeep hunting for half a day. If I'm out in the woods, I don't know what's getting talked about by others who are elsewhere in the woods. You fly fish with somebody for five to seven hours; you get to know a person. You just can't keep your guard up that long. You lose your temper or something happens and the board director gets to see the real you.

Do you take measures to filter what board members might learn from executives several levels below you? For example, when a board ember learns something unusual is he or she expected to report the fact back to you?

If you want to be transparent, you might as well just be transparent.

If I were a board member and thought that the CEO was prescreening what people should say, I wouldn't like that very much. People who work for me have no obligation to tell me what they have said to a board member, unless the director tells them, "Hey, would you make sure Lewis knows we've talked about this?" or if they think that they might have gotten themselves in a place where they didn't want to be, or they're afraid the board member didn't understand something. Otherwise they have no obligation, none, zero.

That's another thing about our talent zone that's so great. This is like working every day at the Harvard Business School. Because you have these different case studies that are ongoing with no proctor to tell you how the real story turned out.

AIG CEO Martin Sullivan: Act II: Finding a New Balance

Martin Sullivan got the CEO seat at AIG due to its regulatory crisis. But can he take the financial giant to the next level?

Three Pillars of Globalization

CEOs may be divided over the critical measure for success in becoming global. But they are united in reckoning that culture and people are the greatest hurdles to success.

Shaheen’s Advice Machine

George Shaheen suspects knowledge capital will be the business currency of the 21st century-and he wants Andersen Consulting to be able to coin it.

An Iconoclast In A Cutthroat World

Sometimes growth isn't limited by capital, technology, or access to markets. It's more fundamental. To Gillette's Al Zeien, it's about reinforcing a global management culture.

Who Has The Best Board…And The Worst?

Over the years, we've heard countless comments from CEOs and directors on the qualities and capabilities-or lack thereof-of corporate boards. I'll never forget the disgusted look on the faces of roundtable participants at a gathering in 1985 when Carl Icahn described the "typical" board as a group of "golfing friends" and "old fraternity buddies" of the CEO. Incidentally, I've been meaning to ask Carl what it's like on the other side of the table. Not surprisingly, he hasn't said much lately about do-nothing boards.

Today, institutional investors and corporate gadflies are taking center stage in the ring cycle of corporate governance. They are telling such giant companies as IBM they don't like the makeup of its board, and that they want the company to do something about it. Trouble is, not everyone agrees on what comprises a good or bad board. Circumstances and companies differ. CEOs, directors, investors, academics, media pundits, lawyers, and accountants often disagree on this matter.

Since the fat lady hasn't yet sung, we've decided to add an aria of our own. Toward that end, we ask you to tell us which companies have the best and worst boards and why. I've asked CE "Speaking Out" columnist Bob Lear-who recently became chairman of the CE Advisory Board-and Boris Yavitz, former dean of the Columbia Business School, to scrutinize and comment on the information you volunteer. Both are corporate governance consultants. Together with a group of directors they assemble, Bob and Boris will establish evaluation criteria for boards and hand out some kudos and brickbats of their own.

Please write to us with your experiences as soon as possible. Send your submissions to the Editor, Chief Executive magazine, 733 Third Avenue, New York, NY 10017. We will publish the results of our informal survey in an upcoming edition. If you wish, your tales will be held in confidence.

Meanwhile, Bob will have more to say about boards in his space in November.

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