Experience Vs. Results
When the government is in trouble, voters cry out for leaders from outside the Beltway. When a company is in trouble, shareholders also call for change. But a lack of baggage can also mean a lack of knowledge, and as these five C.E.O.'s demonstrate, past performance is no guarantee of future results. Now, a look at how much experience—or lack thereof—matters in the corporate suite.
Carly Fiorina
1999–2005: Hewlett-Packard
Previously executive V.P. at: AT&T, Lucent Technologies
Results: Poor. Soon after joining H.P., Fiorina oversaw a controversial merger with Compaq, and performance slowed. In 2005, H.P.’s board moved to transfer some of her authority to division heads, and she was dismissed.
Lou Gerstner
1993–2002: I.B.M.
Previously C.E.O. at: American Express, RJR Nabisco
Results: Good. I.B.M. was on the verge of collapse when Gerstner refocused its business on I.T. services and embraced the internet, helping make it the world’s largest and most profitable computer company.
Alan Mulally
2006–present: Ford
Previously C.E.O. at: Boeing
Results: Mixed. Mulally, who revived Boeing after September 11, 2001, promised to return Ford to profitability by 2009. Ford posted an unprecedented $8.7 billion loss for the second quarter of 2008.
Bob Nardelli
2000–2007: Home Depot
Previously senior V.P. at: General Electric
Results: Mixed. Nardelli doubled sales within the first five years of his tenure, but factors including the housing downturn and his insistence on high compensation led to his resignation.
Terry Semel
2001–2007: Yahoo
Previously co-C.E.O. at: Warner Bros.
Results: Poor. Semel rescued Yahoo by attracting advertising through partnerships and acquisitions, but the company’s stock fell 22 percent in July 2006 after the delayed introduction of its ad-search service. Semel resigned in 2007.
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