What’s Wrong With Tech CEOs?

Fired CEOs are seldom the idiots in retrospect they appeared to be at the time. Take GM’s late Bob Stempel, a supremely accomplished executive who received a lot more respect in his obits last week than he did in the early 1990s. Back then, the economy was emerging from recession, and Stempel was the first of a series of big-name CEOs overthrown by activist boards at companies that seemed unable to get in gear. These revolts weren’t seen as disconnected episodes at the time. They were hailed as evidence that boards of directors had finally begun to do their job, taking charge of companies whose drift was beginning to verge on catastrophe.

And now for the historical parallel: In place of Stempel of GM, Akers of IBM, and Robinson of American Express, should we today be thinking of Ballmer of Microsoft, Bartz and Yang of Yahoo, and Chambers of Cisco? Steve Ballmer has grown sales and earnings impressively over his 11 years heading Microsoft. Yet the stock has been flat for most of that time.

Serious critics don’t fault Mr. Ballmer because Microsoft hasn’t turned itself into Google, Apple and Facebook rolled into one. If anything, they fault him for throwing capital in too many directions and treating every company that comes along as a strategic rival. Their latest frustration is his $8.5 billion purchase of Skype, a profitless company that sold two years earlier for $2.7 billion, which some see as an expensive play to keep an asset out of Google’s hands. Unthinkable to Microsofties, unsentimental holders of the stock just wish the company would focus on milking its Windows and Office franchises rather than battling the Joneses.

SOURCE