Experts fault BACVA decision

Keeping ousted CEO on is `crazy,' one says

Role is as consultant

O'Malley spokeswoman defends the board

March 02, 2003|By June Arney and Bill Atkinson | June Arney and Bill Atkinson,SUN STAFF

A decision by the board of directors of Baltimore's flagging convention bureau to keep its ousted chief executive around as a consultant is irresponsible because his leadership has already been repudiated as ineffective and divisive, ethics and management experts say.

By continuing a relationship with Carroll R. Armstrong, experts say, the board appears weak and engaged in a futile attempt to save face as the Baltimore Convention Center flounders amid plunging attendance and a swelling deficit.

The Baltimore Area Convention and Visitors Association, whose primary responsibility is to attract major conventions and trade shows to the city, announced Jan. 22 that Armstrong would resign. It also said he would be retained as a consultant and assist BACVA in the search for his replacement.

"The conflict for me is if the person wasn't satisfactory in the job, it doesn't make sense to keep paying them as a consultant and an adviser to the board," said Alexander Horniman, professor of business administration at the Darden Business School at the University of Virginia.

"It troubles me, if a person resigned, that they get paid to come back and be a consultant and be on the board to choose the new chief executive. That's crazy," Horniman said.

Mayor Martin O'Malley, who appoints the BACVA board, declined several requests to be interviewed. Through a spokeswoman, he defended the decision to retain Armstrong.

"Carroll brings a lot of history, skills and experience," said Raquel Guillory, the mayor's press secretary. "He has been and will continue to be a valuable asset. That's why he's staying on.

"He, probably more so than anyone, knows the challenges and the tasks that face his successor."

Clarence T. Bishop, the chairman of the board who also declined to be interviewed, said in a statement released by BACVA: "The board felt that Mr. Armstrong possessed valuable experience gained over his six years as BACVA president and CEO that could be helpful ... going forward, and could be helpful in a smooth transition in leadership."

"Mr. Armstrong," the statement added, "has done many good things for BACVA, and the board felt that providing him the opportunity to participate in identifying new leadership was the right thing to do and an appropriate professional courtesy."

Others say, however, that the falling business at the convention center after a $151 million expansion and a stinging report by an outside consulting firm undermine any defense for keeping Armstrong as a consultant.

BACVA has not disclosed what Armstrong is being paid as a consultant. His contract as CEO ran through 2005 with an annual salary of $180,000, plus bonuses.

Allison Adams, chairwoman of the Hospitality & Tourism Management Department at Grand Valley State University in Allendale, Mich., said: "I see huge things wrong. This is ridiculous. You fire somebody and you want to keep him around as a consultant. ... Of what possible value are his thoughts?"

Performance Management Inc. of Stamford, Conn., a consulting firm hired to examine BACVA's operations, found widespread problems and was critical of Armstrong's leadership.

BACVA and city officials have refused to release the full report, reportedly as part of an agreement reached with Armstrong and his attorney, Kurt L. Schmoke, who when mayor of Baltimore hired Armstrong to run BACVA.

A summary of the report, released nine days ago, criticized BACVA as ineffective in performing its primary mission - drawing conventions and tourism business to Baltimore.

It rebuked BACVA for deficient leadership, having too many layers of management, a poorly managed sales team, ambiguous roles and responsibilities for staff, and criticized the organization's internal reporting and accounting controls.

BACVA, the summary said, overstated its membership for three years and consistently has overstated its revenues.

In the first half of its fiscal year, bookings for hotel rooms plunged 62 percent from a year earlier; the convention center's operating deficit is expected to nearly double this fiscal year and increase again in fiscal 2004.

Supporters of a $151 million expansion of the convention center, completed about six years ago, won backing for the project by promising that it would draw significantly more conventions and tourists to Baltimore.

Just the opposite has been true. The Sun revealed last June that the convention center has never attracted the number of conventions, or the convention and trade show attendance projected. In fact, the complex is drawing fewer people than it did before the expansion.

BACVA subsequently retained Performance Management to examine its day-to-day operations.

After Armstrong was forced to resign, BACVA announced the hiring of Marshall Murdaugh, a veteran tourism strategist who has headed several convention bureaus, to serve as interim head during the search for a new CEO.

Murdaugh, founder of Marshall Murdaugh Marketing in Richmond, Va., is expected to work at BACVA for about three months.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.