Comments on: Lead from the front, or manage from the grave? http://blogs.reuters.com/lucy-marcus/2012/01/26/lead-from-the-front-or-manage-from-the-grave/ Wed, 06 Mar 2013 09:49:44 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: BernardGrob http://blogs.reuters.com/lucy-marcus/2012/01/26/lead-from-the-front-or-manage-from-the-grave/#comment-164 Mon, 07 May 2012 15:49:08 +0000 http://blogs.reuters.com/lucy-marcus/?p=37#comment-164 Once again, on the mark.

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By: DeLaVega http://blogs.reuters.com/lucy-marcus/2012/01/26/lead-from-the-front-or-manage-from-the-grave/#comment-34 Sat, 28 Jan 2012 21:28:50 +0000 http://blogs.reuters.com/lucy-marcus/?p=37#comment-34 You are absolutely right: When major change is needed, restructuring the board should be the FIRST step. I can speak to this first hand as my business focus has been and continues to be on dealing with under-performing companies. After an initial in-depth analysis, the first step is always a restructuring of the board before any further action is taken. Although there is more complexity involved than this comment section will allow, said simply, if you get the board right and laser focused on performance and value maximization, then all else will cascade down from that level.

Restructuring the board in an of itself, is not enough. It is essential that the “right” board members be selected based on the particular situation. You noted RIM and Yahoo in your post. In both situations, the major investors have a much better grasp on what is needed than the incumbent board members do. At RIM, Jaguar Financial has been very vocal about what is needed and they are correct in their assessment. At Yahoo, activist investor Dan Loeb has also been vocal about this and is gearing up for a proxy fight if necessary.

By and large, active and sophisticated investors usually have a much clearer perspective regarding what is needed to improve a board than the board does. This says something about governance in publicly traded companies. You state that companies in transition “offer opportunities for fundamental, board-led change for the better….” Agreed that the opportunity is there. But, the likelihood that board-led change in these situations will be effective is very low to non-existent.

Henry D. Wolfe

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By: NigelCameron http://blogs.reuters.com/lucy-marcus/2012/01/26/lead-from-the-front-or-manage-from-the-grave/#comment-29 Thu, 26 Jan 2012 08:45:55 +0000 http://blogs.reuters.com/lucy-marcus/?p=37#comment-29 Two pretty dramatic examples that will keep biz school profs and (one suspects) corporate obituarists busy for some time, and I think the analysis is spot on. The kind of myopeia of which often very smart and decent men and women are capable when a company is going down is a study in the fascination of the horrible. Another way of saying that gaining perspective on our own situation is a hard thing. Another reason to read, for example, Thomas Kuhn and Leon Festinger, who tend not to make their way onto biz school reading lists (wondering here how many of the principals Lucy refers to have heard of them). At the end of the day, while organizations fail for many reasons the more the environment is characterized by change and the faster that change is taking place (ahem, Moore’s Law), the bigger the threat posed by groupthink, in its various iterations.

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