A Tale Of Two CEOs

Dec. 21, 2004
It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us . . . . Many of you will remember the opening paragraph of Charles Dickens magnificent novel, A Tale of Two Cities. Its timeless profundity describes another century in another place. And yet the words and thoughts are as applicable to todays CEO challenges as they were to Sydney Cartons travails during the French Revolution. Please pardon my temerity in adapting his genius to a present-day management problem. Dickens A Tale of Two Cities is about to become Marinos A Tale of Two CEOs. "Sydney Carton I" was chief executive of Charles Corp. in the best of times. His was the age of wisdom, the epoch of belief, and the season of light. His was also the spring of hope, with everything before him. "Sydney Carton II" was chief executive of Dickens Corp. in the worst of times. His was the age of foolishness, the epoch of incredulity, and the season of darkness. His was also the winter of despair, with nothing before him. Things were easy for Sydney I. The economy was booming. Customers were lined up to buy scarce product. Revenues and profits soared. Short-term profits hid long-term problems. Production slippage was ignored, and capital investments in new technologies were postponed. Sydney I was so busy counting his personal blessings he ignored his companys eroding people skills, his companys eroding professional skills, and his companys eroding ability to cope with change. He collected his humongous bonuses and cashed in his million-dollar options. Good enough was good enough. So let the good times roll. Things were difficult for Sydney II. The economy was in a deep funk. His company was losing market share. Revenues were eroding. Profits were nil. Morale was losing its starch. Equipment was a collection of second-hand junk driven by necessity instead of efficiency. He had no bonuses, no options, and few business worries because he had no business to worry about. Given your choice, which of these Sydney Cartons would you rather be? My guess is that most of you would rather be Sydney I. Why? Because most captains of industry like the status quo. They do better sailing in calm seas rather than turbulent ones. They are cookie-cutter replicas cloned in the laboratories of business schools where hurricane winds rarely blow. But I would guess that most really good chief executives would opt to be Sydney II. They like challenge. These captains sharpened their skills in the business schools of hard knocks where troubled waters abound. They learned to be excellent captains by sailing where others rarely dared. Ill prove my point with a real-life story reported to me by a friend. Some years ago two candidates had their eyes on the top job at General Electric Co. Smith had risen to his heir-apparent status sailing on calm economic seas. Jones, on the other hand, had learned his management skills during business recessions. When he was given GEs neophyte computer operation to run, Smith accepted the assignment with enthusiasm, but after two years of valiant effort he had been unable to penetrate IBM Corp.s playpen. Then, when Jones was given his turn, he knew from experience that impossible dreams are impossible under any management, and after studying GEs late entry into a market dominated by a giant rival, he sold the computer division to Honeywell. That was a major reason Reginald H. Jones became CEO of GE instead of J. Stanford Smith. (I got this story from one of the contestants: Stan Smith.) The moral: Chief executives who learn to navigate in turbulent seas can sail their ships anywhere they please. Sal F. Marino is chairman emeritus of Penton Media Inc. and an IW contributing editor. His e-mail address is [email protected].

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