Image consultants assess Card's resignation

March 29, 2006|By DAN THANH DANG | DAN THANH DANG,SUN REPORTER

Let's imagine for a minute you're the head of a global corporation that's seen better days. The numbers are down, shareholders aren't thrilled, and crisis after crisis has battered the company's standing in the market.

What should the chief executive do?

A: Fire a scapegoat. B: Replace the entire leadership team. C: Do nothing. D: None of the above.

Which option did President Bush take yesterday when he announced that he had accepted Andrew H. Card's resignation as his chief of staff and installed budget chief Joshua Bolten in his place?

Business experts, who were asked what they thought of Bush's move -- he is, after all, the first president to have an MBA and surely taps into that background as the nation's chief exec -- weren't entirely sure.

In the wake of the president's dreary approval ratings, many political-watchers labeled the move a desperate response to growing calls for a White House shake-up. Others groused that the change was merely cosmetic, not enough to reinstate confidence. Still others deemed it a good step in the right direction.

If you ask John Rizzardi, the move is too little, too late.

"Is he trying to turn around an image or is he trying to turn around a country?" asks Rizzardi, a director of Chicago-based Turnaround Management Association, an international nonprofit group that specializes in restoring and strengthening troubled companies. "I think he's taking an interesting first step in turning around his image. But I think the global and national issues he is facing are a lot more difficult to turn around and will require far more intense work than what a simple chief of staff change will do."

Staffing shuffles are always hard to interpret, in business or in government. Will this one turn around what some view as a wayward ship? Is Card's resignation the mark of a good CEO in control of his company's future or a bad CEO taking the business down with him?

"I think the president, like a lot of presidents of companies, has a particular agenda in mind," Rizzardi says. "But if your agenda is off-track and you're not in tune with what is actually going on, you might not be capable of doing what's needed to turn the company around. If this were a company and this were a turnaround candidate, I would make sure this particular CEO would go on permanent vacation.

"I would give him a year's severance pay," Rizzardi says.

Not so fast, other turnaround consultants say.

They gave Bush good marks for not panicking and avoiding knee-jerk decisions.

"What I like about his leadership style is that he doesn't just react," says John M. Collard of Strategic Management Partners, a turnaround specialist in Annapolis who has advised former Presidents Bush elder and Bill Clinton, Boris Yeltsin's Russian Privatization Agency, the World Bank and various company boards.

"I think he's got the American public at heart," Collard says. "If he were just trying to revamp his image, I don't think he'd pick fights with Congress like nominating [Samuel] Alito to the Supreme Court. As a good leader, you have to have strength, conviction and a plan to go forward.

"You also have to know when mistakes are made, to pull back. He pulled back with Harriet Miers."

Collard predicts more changes.

But before taking any rash steps, a good CEO will assess the situation, turnaround experts say. The CEO will then identify -- or at least hire a good turnaround specialist who will identify -- problems. And finally, the CEO will find solutions to solve the problems in the immediate and distant future.

In other words, if a company's sales are down and you fire the chief financial officer, that doesn't fix the sales problem.

Now apply that to the Andy Card announcement: If Card truly were to blame for all of the administration's ails -- and he no doubt isn't -- then Bush could gleefully fly to Crawford, Texas, and call it a day.

It's never that simple -- it's exceedingly rare that one person would be responsible for every problem in an organization. That's why turning around a company trying to recover from a scandal, bankruptcy or other crises is also never as simple as one person's leaving, turnaround experts say. It's even more complicated if you're talking about running the U.S. of A.

"A few changes in leadership isn't going to fix everything," says Michael Sitrick, chairman and CEO of Los Angeles-based Sitrick and Co. He's the man the Los Angeles Times calls the "Wizard of Spin" and Forbes calls "The Flack for When You're Under Attack."

"You don't win by making personnel changes," Sitrick says. "You win by achieving results. Cicero said, `Advice is judged by results, not by intentions.' At the end of the day, the real question is not whether [Bush] replaced his chief of staff, but what is being done to address the problems and opportunities of the future. ... It's a very difficult situation for him."

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