C.E.O. Evolution Phase 3

C.E.O. Evolution Phase 3
By NELSON D. SCHWARTZ
Has the time come for C.E.O. Version 3.0?
The first iteration made its mark in the 1990s, as chief executives like Sanford I. Weill, Gerald M. Levin, John F. Welch Jr. and Michael Eisner built empires, not to mention their profiles, at the companies they ran: Citigroup, Time Warner, GE and Disney.
When the shares deflated earlier this decade after the burst of the tech bubble and various corporate scandals, a new cadre moved in: the Fix-it Men. They were lower-key leaders like Charles O. Prince III of Citigroup and Richard D. Parsons of Time Warner, whose job it was to repair the excesses and mistakes of their predecessors.
Now, management experts and longtime watchers of corporate America say the current environment demands, and is attracting, yet another kind of chief executive: the team builder.
“It’s someone who can assemble a team that functions as smoothly as a jazz sextet,” said Warren Bennis, a professor of management at the University of Southern California and author of many books on leadership.
In the last week, Mr. Prince and Mr. Parsons both announced they would be stepping aside. Mr. Prince’s abrupt exit followed huge losses that dragged down Citigroup’s long-stagnant stock, while Mr. Parsons is retiring at the end of 2007 after a five-year tenure, during which he stabilized the company but failed to move Time Warner shares higher.
A third chief executive, E. Stanley O’Neal of Merrill Lynch, was forced out late last month after his firm announced an $8.4 billion write-down.
Mr. O’Neal substantially increased Merrill’s revenue and profit during his tenure but has been criticized for forcing out subordinates he perceived as rivals, while several top executives left Citigroup during Mr. Prince’s reign. Now both companies find themselves searching for permanent replacements.
“They’ve got to have not just the cognitive ability to run a major firm, which Stan O’Neal definitely had, but the ability to make people feel like they’re working together,” Mr. Bennis said.
Merrill and Citi might consider looking at chief executives like A.G. Lafley of Procter & Gamble or W. James McNerney Jr. of Boeing as archetypes of the new model, according to Mr. Bennis.
“Both felt the need to make sure the top hundred people know that they’re in this together, that their fates are correlated,” Mr. Bennis says. “That’s what it will take to succeed in this century.”
Mr. Lafley and Mr. McNerney have won plaudits not merely for their personal style, but also for their bottom-line performance, with shares of Procter & Gamble and Boeing easily outpacing the likes of Citigroup and Time Warner, as well as the benchmark Standard & Poor’s 500-stock index, over the last two years.
That’s no coincidence, according to Michael Useem, a professor of management at the Wharton School of the University of Pennsylvania and director of the Center for Leadership and Change Management there. “The academic research says if you want to predict what the future financial performance over the next one to three years will be, you need to know the top team,” he said.
Jeffrey A. Sonnenfeld, senior associate dean for executive programs at the School of Management at Yale, says the style of today’s best chief executives differs from both the empire builders and the cleanup specialists.
The former were known for public swagger and boardroom-size egos, while the latter often excelled at a narrow set of skills, Mr. Sonnenfeld said. He cited Mr. Prince’s skills as a lawyer who was able to get his company back into the good graces of regulators after Mr. Weill’s departure. Others say Mr. Parsons was a strong administrator, but failed to offer a strategy that satisfied Wall Street.
Mr. Sonnenfeld says Mr. Lafley and Mr. McNerney, along with Anne Mulcahy, chief executive of Xerox, possess the vision of the empire builders without their overpowering egos, while also bringing more personal warmth to the corner office
Ms. Mulcahy, for example, was able to cut jobs and restore Xerox’s profitability “without coming across as mean-spirited,” Mr. Sonnenfeld said. Mr. Lafley “is disarmingly unpretentious,” he added. “He never comes to my summits and I’ve never been a consultant for him, but he towers over other C.E.O.’s when it comes to putting in people stronger than himself or his ability to talk about setbacks.”
Mr. Lafley has spent his entire career at Procter & Gamble, while Mr. McNerney arrived at Boeing after decades at General Electric, long regarded as something of a management boot camp, and after a successful stint as chief executive of 3M. Although clearly an outsider at Boeing, Mr. Sonnenfeld said, “he learned to listen to the culture there.”
This approach, he said, means these leaders were able to “introduce change but people don’t hate them for it; the team comes to them.”
Mr. O’Neal, on the other hand, “fired people who shouldn’t have been fired,” Mr. Bennis said. Mr. Prince, he added, “was always in the shadow of Mr. Weill; he never was able to build his own team.”
And when disaster struck in the form of billions in losses from the subprime meltdown, these weaknesses came back to haunt Citigroup and Merrill Lynch.
“Whenever you have such a stunning decline, errors become much more visible,” Mr. Bennis said.
Of course, just as chief executives shape the times, so do the times shape them. “There’s a theory that the people who get to the top at big companies should be best at solving the problems of their era,” Mr. Useem said.
In fact, Mr. Sonnenfeld said, the original archetype was what he called “the custodian,” leaders who came of age during the Organization Man era of the 1950s, but were overwhelmed by the rapidly shifting economic landscape of the 1970s and 1980s.
They were followed by the empire builders who focused on mega-mergers and financial management in the 1990s to deliver the growth Wall Street demanded while getting big enough to achieve economies of scale and beat back foreign competitors.
The cleanup artists arrived on the scene in the wake of the collapse of Enron and WorldCom and the passage of Sarbanes-Oxley legislation, which tightened government oversight of public companies.
At the same time, investors were demanding quick fixes. In Time Warner’s case, Carl C. Icahn, the billionaire activist investor, pressed for a quick breakup of the company, something Mr. Parsons was able to stave off.
Business schools are also opting for the 3.0 approach. At the Yale School of Management last year, Mr. Sonnenfeld said, the dean and faculty threw out the old first-year curriculum that emphasized individual disciplines like finance and marketing and replaced it with a team-oriented approach, with professors teaching these subjects jointly. In addition, he said, “We have students, faculty and staff assemble their own teams as part of their training to be future execs.”
What will be the main challenge in the next 5 to 10 years? Mr. Useem predicted it would be achieving double-digit growth internally, without the benefit of huge deals or accounting sleight-of-hand. “That’s why I think the baton will go to the manager who will stimulate a division and will be creative and innovative,” he said.eventive medicine/health optimization."

Spin Blog - Business Spin by Jack Flack: Merrill Lynch: How the Media Helped Fire Stan O'Neal - Portfolio.com

Spin Blog - Business Spin by Jack Flack: Merrill Lynch: How the Media Helped Fire Stan O'Neal - Portfolio.com

This afternoon, the WSJ's Randall Smith and Tom Lauricella reported one scenario for the departure of Stan O'Neal, while CNBC's Charles Gasparino reported another. Either way, the assumed exit would conclude an incredibly rapid decent down Jack Flack's "Five Levels of CEO Media Hell," revealing much about the connection between the news media and back-room power-plays.

So how did the story accelerate so quickly?

1. The espoused story was never the real story.

Espoused story: "Unexpected, massive write-offs from reckless risk-taking, combined with side-dealing without board endorsement, has forced the board to consider firing O'Neal."

Real story: "The write-offs and side-conversation made O'Neal vulnerable to the legions of enemies he's made in bluntly hacking away at the Mother Merrill culture."


The toppling of a powerful CEO is seldom actually about performance, and almost always about the control of power and the vengeance of embittered egos. Fire a bunch of type-A bankers and brokers over the years, and you better watch your back, particularly with one who felt born to the job you got instead. Urinate on the culture, and watch some scary ghosts come out of the attic.

Cablevision Deal

The Wall Street JournalCablevision Deal
Meets More Opposition
By PETER GRANT and TOM LAURICELLA
October 17, 2007; Page A3

ClearBridge Advisors, the largest institutional shareholder in Cablevision Systems Corp., plans to vote next week against the Dolan family's bid to take the company private, delivering a potentially crippling blow to the $10.6 billion effort, according to people familiar with the matter.

A defeat would end a two-year struggle by the Dolans to take private the company, which owns cable systems in the New York area as well as sports teams such as the New York Knicks and Madison Square Garden. The company has been embroiled in numerous battles in recent years, occasionally between family members. Despite these fights, the company's cable unit is an industry leader in financial performance.

ClearBridge owns about 14% of Cablevision's public stock. Three other large institutional shareholders that together control about 20% of the vote -- Gamco Investors Inc., T. Rowe Price and Marathon Asset Management -- have already indicated their intention to oppose the buyout at the shareholder meeting scheduled for next Wednesday. The Dolans -- who own about 20% of the company through a separate class of stock that they can't vote in this matter -- need approval of 50% of the public shareholders.

Like the other dissidents, ClearBridge believes the Dolans' offer of $36.26 a share is too low. Gamco and T. Rowe Price executives, for instance, have said the company is worth more than $50 a share. They have challenged the company's $4.8 billion valuation of its noncable assets, which also include Radio City Music Hall and numerous TV channels. They have also argued that Cablevision's cable systems are worth more than those at companies like Comcast Corp. and Time Warner Cable Inc. because they serve more affluent areas and are further ahead in rolling out phone service and digital cable.

A similar view is taken by ISS Governance Services, one of the leading proxy advisory firms to institutional investors which last week recommended that shareholders vote against the buyout because the price is inadequate. Also, Proxy Governance Inc., a proxy advisory firm based in Vienna, Va., recommended yesterday that shareholders reject the offer.

Few believe the Dolans could afford to raise the price. Even under the current plans, the Dolans are planning to add $8.5 billion of debt to Cablevision's existing $10.5 billion in debt.

Shareholders may still approve the Dolans' plan even with strong institutional opposition. Cablevision's share price has tracked the offer, closing yesterday at $33.70, down 20 cents. But as a group, cable stocks have declined about 20% since May when the family made its latest bid, making the offer more appealing.

Craig Moffett, cable analyst for Sanford C. Bernstein, noted that many of the shareholders who own Cablevision also invest in other cable stocks and that if the Dolans' bid is voted down, Cablevision's shares may fall 10% to 20%. "Any investor who has endured the pain of owning cable over the summer is going to be loath to sign up for another dose by voting this thing down," he said.

Spokesmen for the Dolans and Cablevision declined to comment on ClearBridge's plans. But Cablevision Chief Executive James Dolan said in a written statement released last night that the family won't raise its offer. The company's board recommended the bid in May, noting that it represented a 34% premium to the family's offer the previous year.

ClearBridge's decision comes at a time of rising activism on the part of mutual-fund companies, which traditionally have been loath to pick fights with the management of companies in which they invest. Most notably, T. Rowe Price earlier this year tried unsuccessfully to stop a buyout of Laureate Education Inc., and Lord Abbett Inc. opposed a proposed private-equity buyout of OSI Restaurant Partners Inc., which operates the Outback Steakhouse chain.

ClearBridge's stake in Cablevision sits in its $4.4 billion Legg Mason Partners Aggressive Growth fund, managed by Richard Freeman. Mr. Freeman has on several recent occasions squared off with the managements of companies in which he invests. In early 2006, Novartis Inc. raised the price it was offering for Chiron Corp. after Mr. Freeman criticized the terms of the merger. Mr. Freeman was a major holder of Chiron stock, owning 12% of shares outstanding.

Write to Peter Grant at peter.grant@wsj.com and Tom Lauricella at tom.lauricella@wsj.com

Ford and G.M. Expect a July Sales Drop - New York Times

Ford and G.M. Expect a July Sales Drop - New York Times

August 1, 2007
Ford and G.M. Expect a July Sales Drop
By MICHELINE MAYNARD; JEREMY W. PETERS CONTRIBUTED REPORTING FROM NEW YORK.
Over the last 18 months, General Motors and the Ford Motor Company have cut thousands of jobs and billions of dollars in costs and narrowed their North American losses. That helped each post unexpectedly strong second-quarter profits.

But those results may be the best that both auto companies can do, at least in the short run, in a challenging auto market beset by foreign competition and economic concerns.


On Wednesday, G.M. and Ford are expected to report double-digit declines in July auto sales on an unadjusted basis, according to Edmunds.com, a Web site that offers car-buying advice.

The companies have stepped up incentive programs, like rebates and cut-rate loans, in hopes of clearing out 2007 models in preparation for new models this fall.

G.M.'s most important coming vehicle is the new version of the Chevrolet Malibu sedan, which follows updated versions of its pickup trucks, the Chevrolet Silverado and GMC Sierra, introduced last winter.

The trucks' initial sales surge has faltered in the face of high gas prices, slowing home sales and concerns about the broader economy, however, leaving G.M. with soaring inventories of both vehicles at a time when competitors like Toyota are aggressively discounting their trucks.

Despite that, G.M. largely held off on its own deals until this month, and its decision paid off somewhat on Tuesday.

G.M. said it earned $891 million from April through June, or $1.56 a share, compared with a loss of $3.4 billion, or $5.98 a share, in the period a year earlier.

G.M.'s North American operations -- the centerpiece of its business -- lost $39 million in the quarter. That was a significant improvement from the second quarter of 2006, when losses totaled $3.95 billion in North America. On an adjusted basis, G.M. said it earned $78 million.

Either way, it essentially broke even in its biggest market, after almost two years of revamping.

G.M. has never said when it expects to earn an annual profit in North America. Still, G.M.'s chief financial officer, Frederick A. Henderson, said the company deserved credit for getting this far, especially since it did not anticipate high oil and gasoline prices, a slowdown in the housing market or the problems in credit markets that have occurred since it began its turnaround efforts.

''Given that we're breaking even, we've been pedaling pretty fast to get here,'' Mr. Henderson said in an interview. ''But we need to pedal even faster.''

Mr. Henderson said the second-quarter result stemmed from ''a performance that was less than we were hoping for, certainly in the month of June, for example'' when G.M.'s auto sales fell 24 percent.

On Wednesday, Edmunds estimated that G.M.'s average incentive rose to $3,130 per vehicle in July, up nearly $300 per vehicle from its level in June.

G.M. embarked on a reorganization plan in late 2005 that called for it to close all or part of a dozen plants and eliminate 30,000 jobs over three years. The plan was aimed primarily at stemming G.M.'s red ink in North America, the main reason for a near record loss of $10.6 billion in 2005 and a $2 billion loss last year.

Ford, which posted an $750 million profit during the quarter, said last week that it had lost $279 million in North America. It, too, plans to cut jobs -- about 44,000 of them in North America -- and close factories.

Even so, analysts were pleased that G.M. had positive cash flow of about $1.1 billion during the quarter, although they noted the company had reduced its capital spending plans to about $8 billion a year from a previous forecast of $8 billion to $9 billion annually.

Jonathan Steinmetz, an analyst with Morgan Stanley, termed the results ''better than expected.'' Neither Ford nor G.M. issues guidance to Wall Street, a reason both companies' second-quarter profits were above analysts' estimates.

Shares of G.M., which had risen this week on expectations of a strong quarter, fell 21 cents, closing at $32.40 on the New York Stock Exchange. They had risen as high as $34.28 early in the day.

The brightest news for G.M. came overseas. In Europe, G.M. earned $217 million. Profits reached $227 million in Asia, and $213 million in Latin America, Africa and the Middle East. The profit from worldwide automotive operations, including the loss in North America, was $618 million.

But Mr. Henderson said he was not sure that overseas performance could continue in the current quarter, when sales in Europe, in particular, traditionally decline because customers are on extended summer vacations.

''I used to wake up in terror every morning wondering whether people bought cars in the third quarter,'' said Mr. Henderson, who previously ran G.M.'s European operations. ''You have to have a good first half in order to have a reasonable chance at a reasonable year.''

He added, ''We're reasonably pleased with the second quarter, but we have a lot of challenge ahead in Europe.''

Chrysler's New Era Begins Under Nardelli - WSJ.com

Chrysler's New Era Begins Under Nardelli - WSJ.com

Chrysler's New Era Begins Under Nardelli
Cost Cuts, UAW Pact
Are Early Priorities;
Hints About Asset Sales
By GINA CHON and JOANN S. LUBLIN
August 7, 2007; Page A7

Robert Nardelli presented a congenial image of himself in his first appearance as head of Chrysler LLC, but analysts predict the hard-charging former Home Depot Inc. chief executive soon will crank up pressure to cut costs and increase revenue on behalf of Chrysler's new majority owner, Cerberus Capital Management LP.

"We have the ability to move with speed; we have the ability to move with flexibility," said Mr. Nardelli, Chrysler's new chairman and chief executive, during a news conference yesterday at Chrysler headquarters in Auburn Hills, Mich. The company may be able to move quickly to "monetize some assets" that may not be fully valued, Mr. Nardelli said in a possible reference to asset sales. He didn't elaborate.

NEW DRIVER


• Aggressive Style: As new head of Chrysler, Robert Nardelli is expected to push for further cost cutting, while looking for new revenue opportunities.
• Baggage: A Chrysler turnaround could redeem Mr. Nardelli's reputation after his messy exit from Home Depot and a $210 million severance package.
• First on Agenda: Establishing a relationship with the UAW based on trust and invigorating Chrysler's lineup with vehicles people will buy.Mr. Nardelli comes to Detroit carrying baggage from a messy exit this year from Home Depot, where he left after failing to reignite its slowing sales and sagging stock price. He also came under attack for his $210 million exit package. A Chrysler turnaround could redeem his reputation. People familiar with the matter say Mr. Nardelli lobbied Cerberus aggressively for the CEO job.

Mr. Nardelli will receive a nominal salary of $1 a year, according to people familiar with the matter. He will receive equity to ensure he is compensated only if the company improves, these people said, though they wouldn't disclose further terms.

1
AP
Bob Nardelli, right, and United Auto Workers president Ron Gettelfinger, left, stood outside Chrysler on Monday.
Mr. Nardelli spent much of his first day on the job reaching out to reassure constituents who could make or break his tenure. Among them: United Auto Workers President Ron Gettelfinger, a group of Chrysler dealers and Chrysler employees, starting with Chrysler Vice Chairman and President Tom LaSorda, whom Mr. Nardelli will succeed as CEO. During the news conference, Mr. Nardelli often put a hand on Mr. LaSorda's shoulder, deferring to him to answer questions from reporters.

But people who know how Cerberus and Mr. Nardelli operate say they expect Mr. Nardelli will soon push for further cost cutting and additional efforts to streamline operations, while looking for new revenue opportunities for the ailing company.

"Chrysler is a huge investment for Cerberus, and it didn't want to take any chances," a person familiar with the matter said.

Chrysler spokesman Mike Aberlich said Mr. Nardelli's aggressive style is an asset for Chrysler. "Being a disciplinarian is a good thing because we have a plan, but we really have to execute it, and that's what Bob brings to the table," he said.

Jeffrey Sonnenfeld, a senior associate dean at Yale University's School of Management, said Mr. Nardelli "works 24/7 and expects that of his people." In stressing execution, "he goes for obedience and loyalty," Mr. Sonnenfeld added.


WSJ's Joann Lublin analyzes whether Robert Nardelli, the ousted Home Depot CEO, will succeed in his new role as chairman and CEO of Chrysler.
Mr. Nardelli said yesterday he has no plans to launch a new strategy at the ailing auto maker but will focus instead on executing a restructuring plan already in place. He also said it would be premature to discuss cutting costs further and added that the focus won't just be on "head count but also on head content," and part of his job will be to make sure that employees are utilized to their fullest potential.

Chrysler's restructuring plan -- put together by Mr. LaSorda, who retains his title as Chrysler president -- calls for eliminating 13,000 jobs and making a $3 billion investment in engine systems with improved fuel economy. The company also plans to close its Newark, Del., factory and will eliminate shifts at other plants.

Some analysts are skeptical that Mr. Nardelli really intends to do nothing more than execute his predecessor's plan effectively. Erich Merkle, an auto analyst with auto-industry research firm IRN, said he expected Mr. Nardelli was brought in to "slash and burn" at Chrysler, cutting costs and streamlining operations. The results from that effort, and crucial products such as Chrysler minivans and a redesigned Dodge Ram pickup truck that is slated to hit showrooms next year, should produce profit for Chrysler, he said.

Mr. Merkle said he expects the new owners to prepare Chrysler for a quick sale to another buyer. Since the sale of an 80.1% stake in Chrysler was announced in May, Cerberus has said it will be a long-term investor, and Mr. Nardelli said he has no plans to leave Chrysler.

The biggest and most immediate problem facing Chrysler, the smallest of the three unionized Detroit auto makers, is the UAW. Chrysler, Ford Motor Co. and General Motors Corp. recently began talks with the UAW toward a new national agreement in September. The auto makers want to restructure more than $90 billion in health-care debts owed to UAW retirees.

Messrs. Nardelli and LaSorda spoke to Mr. Gettelfinger, the UAW president, for two hours about the management change. During that meeting, Mr. Nardelli said, the union leader brought up his Home Depot exit package, which angered shareholders in the home-improvement retailer who felt the compensation was undeserved, given the performance of the company.

Mr. Gettelfinger spoke briefly to employees after the news conference, saying, "We want to add our welcome to Mr. Nardelli as chairman and CEO."


Watch highlights of Monday's press conference.
Mr. Nardelli said he hoped he could establish a relationship with the UAW based on mutual trust and emphasized that Mr. LaSorda will continue to lead the negotiations with the UAW this summer. Mr. Nardelli also said he hoped the controversy surrounding his exit package wouldn't be an issue or a stumbling block, especially when it comes to the UAW talks.

"The last thing I would want to be is a distraction," Mr. Nardelli said.

Also on Mr. Nardelli's list of meetings yesterday was a group of Chrysler dealers. Chrysler executives have acknowledged the company has far too many dealers for its diminished share of the U.S. market, and it has begun taking steps to cull low-performing stores. But state franchise laws, which protect dealers, hinder any effort by Chrysler to quickly narrow its retail network.

"He has to fix the retail supply chain," said Mike Jackson, chief executive of AutoNation Inc., the nation's biggest auto retailer by locations and sales. In addition to narrowing the number of Chrysler dealerships, Mr. Jackson said, the "next step is produce and configure vehicles the way the marketplace wants them."

Invigorating Chrysler's lineup includes developing fresher-looking vehicles as well as updating aging technology and fixing quality problems that have undermined the company's brand image.

Chrysler badly needs to devise a better strategy for designing vehicles that "people will buy at full price," said James E. Schrager, an auto-industry specialist and a professor of strategic management at the University of Chicago's Graduate School of Business. But "that's where Nardelli has the longest shot."

Importing Chiefs, Detroit Reflects on Its ‘Car Guys’ - New York Times

Importing Chiefs, Detroit Reflects on Its ‘Car Guys’ - New York Times

August 13, 2007
Motor City Memo
Importing Chiefs, Detroit Reflects on Its ‘Car Guys’
By MICHELINE MAYNARD
DETROIT, Aug. 12 — Where have all the car guys gone?

With the surprise appointment last week of Robert L. Nardelli, the former Home Depot chief executive, to run Chrysler, Detroit has completed a new-model changeover of the executive suite. It is no longer a requirement to have “motor oil in your veins,” as they are fond of saying in this city, to run a car company.

None of the chiefs now leading the three American car companies can be credited for inspiring or developing anything on the roads today — the unofficial definition of what makes a Detroit chief executive a true “car guy.” Only one of them, Rick Wagoner at General Motors, has more than a year of experience in the industry.

Moreover, very few of their highest-ranking colleagues have come up through the design, engineering or marketing side of the business so vital to Detroit’s existence.

It is a sharp break from a tradition stretching back to the industry’s infancy, when car builders became chiefs of the companies that bore their names. As recently as last decade, all three chief executives could brag about cars they had helped develop.

Ford’s chief at the time, Donald E. Petersen, oversaw the Ford Taurus and earlier Fords. At G.M., Robert C. Stempel engineered several vehicles, including the Oldsmobile Toronado.

And the most famous car guy of the time, Lee A. Iacocca, was credited with the success of Chrysler’s K-cars and its minivan (and the Mustang from a previous stint at Ford). As a marketing expert, though, he admittedly had others doing the actual development work.

But people in some quarters now argue that an outsider’s pragmatic eye may be worth more than the gut instincts that come from bringing a car to life.

Given that the Detroit automakers have lost billions of dollars, and market share, to Japanese competitors in recent years, the evidence may be on their side. Though car guys were responsible for Detroit’s triumphs, they also steered the companies into trouble with errors in judgment that included relying too heavily on big sport-utility vehicles.

“This is a business that needs to be run as a business,” Alan R. Mulally, Ford’s chief executive, said at an industry conference last week near Traverse City, Mich.

Even the now-retired Mr. Petersen, in a rare interview, agreed with that. “I think the concept’s been overdone,” he said last week of the car-guy mystique.

By insisting that only homegrown talent be promoted, Mr. Petersen added, “it’s undervaluing the inherent knowledge that you get about how things do in fact work in a very complex industrial setting.”

The appointment a year ago of Mr. Mulally, a former president of Boeing Commercial Airplanes, marked the first time an outsider had been appointed to run an auto company in Detroit, where lengthy careers at a single company are still the norm.

Mr. Wagoner, for example, joined G.M. 30 years ago, and rose to chief financial officer in 1992 at age 39.

By contrast, Mr. Nardelli has barely finished his first week as an automobile executive. His appointment has led to a kind of town hall discussion in the industry — in union halls, on Internet message boards and at an industry conference last week in northern Michigan — about who is best equipped to lead the industry out of its current troubles.

The Detroit News asked readers to share their thoughts at its Web site after Mr. Nardelli’s appointment, and they had wide-ranging opinions about Chrysler’s future under its new owner, Cerberus Capital Management.

“The whole industry has to stop pointing fingers at the rest of the world and instead decide what they can do,” said another reader from Troy, Mich. “It’s their industry. If they don’t fix it, it’s their jobs that go away.”

Another was less confident in the new boss: “I’m terrified by what Nardelli and Cerberus could do to Chrysler.”

Mr. Nardelli hoped to win over some skeptics about his background when he stressed his love for Chrysler products last Monday at a news conference — he said his garage included a Jeep, a Plymouth Prowler and a PT Cruiser.

But Edward Lapham, executive editor of Automotive News, a trade publication, wrote on Wednesday that it would be a mistake for Mr. Nardelli “to assume that just because he likes cars, he’s a car guy.”

Arturo Reyes, the president of United Automobile Workers Local 651 in Flint, Mich., said he was skeptical of Mr. Nardelli.

“I get more excited about the prospect of a company when we’re talking about a car guy who has seen the manufacturing process, who knows the design team, who can talk about quality and everything else,” Mr. Reyes said. To be sure, there is not a car guy in charge at the world’s biggest car company, Toyota Motor, which passed G.M. earlier this year to take the No. 1 spot.

In fact, it is difficult to name a traditional car guy at Toyota beyond the company’s founder, Kiichiro Toyoda, who acknowledged copying a Chevrolet design for Toyota’s first car, the AA, in 1936.

Toyota’s top executives typically have a broad background, not a single expertise. Its current chief executive, Katsuaki Watanabe, is an economist and purchasing expert.

The company’s emphasis on consensus also means an expert’s voice is only one of many when decisions are made, said James Lentz, an executive vice president at Toyota Motor Sales USA.

“The days of just a car guy running with their gut feeling probably are, today, pretty difficult to do,” Mr. Lentz said.

Robert A. Lutz, vice chairman of G.M., is perhaps the Detroit executive best known for a “golden gut” that led him to direct the development of vehicles like the 10-cylinder Dodge Viper sports car.

He said last week that he was not opposed to the idea of industry outsiders at the top.

“What you need is a well-balanced individual who has a lot of experience in the business, who has a brilliant business mind and knows what he or she doesn’t know,” he said at the automotive conference. “If a person from the outside incorporates all those things, then there’s no reason why he or she wouldn’t do well.”

But Mr. Lutz cautioned that Mr. Nardelli, reportedly hired to speed Chrysler’s turnaround from $1.5 billion in losses last year, should not expect quick results. “If anyone thinks they’re going to get all that solved in three months, I wish them a lot of luck,” he said.

A car guy’s background is invaluable in one sense, Mr. Petersen said. In an industry so focused on trying to predict trends, executives benefit from having both their own knowledge about the industry and experience in reading what other car guys are telling them.

“Unless you know the business, you won’t know what can and can’t be done,” Mr. Petersen said. With a car background, “you have the basic ability to be able to challenge.”

To Mr. Petersen, the debate over non-car guys reminds him of an earlier trend, when companies scurried to elevate their chief financial officers, believing that familiarity with Wall Street trumped operating know-how.

For Detroit, Mr. Nardelli’s appointment will be “a very interesting experiment,” he said.

Nick Bunkley contributed reporting from Acme, Mich., and Mary M. Chapman from Detroit.

YouTube - Eye To Eye: Dennis Kozlowski (CBS News)

YouTube - Eye To Eye: Dennis Kozlowski, TYCO Executive discusses his downfall from CEO to prison for extravagant personal purchases using company money. (CBS News)

Column info : Is Your Boss a Bully?

Column info : Is Your Boss a Bully?: "According to an article in American Way, “42% of US workers reported incidents of yelling and verbal abuse in their workplace.” "

People who work for abusive managers often have stress-related problems and illnesses. They miss work due to symptoms, and they are less productive when they are at work. Their energy isn’t going into building software; it’s going into dealing with the emotional fallout of their manager’s behavior.

Managing Today's Multigenerational Workforce - Executive CIO Corporate Culture - Optimize Magazine

Managing Today's Multigenerational Workforce - Executive CIO Corporate Culture - Optimize Magazine

Family Hands Off Its Business, and Its Philosophy - New York Times

Family Hands Off Its Business, and Its Philosophy - New York Times registration may be required
HOLLAND, Mich. — Right up there with putting an aging parent in a nursing home stands the wrenching job of handing over a family business to be run by outsiders.
It happens to any family firm that lasts long enough, from Wal-Mart Stores on down. And, as the experience of the 102-year-old Louis Padnos Iron and Metal Company shows, the transition can be as quirky as the founding family.
The problem for the Padnoses is an age gap. Third-generation members who run the scrap metal company, which employs about 400 people and has annual sales of about $300 million, are in their 50s. They want to work less. But the fourth-generation Padnoses who might someday want to run the place are still only in their teens.
So, the company hired a local philosophy professor, a man who also spends time tutoring convicts at a nearby state prison in classic literature and other topics, to help groom six hired managers to become, well, more Padnos-like.

Six tips that can help spark creativity

Refinery: Six tips that can help spark creativity: "Six tips that can help spark creativity

You do not have to be a creative to utilize these approaches. They work for me, and if you give them a try, they may work for you too. "