07:09 AM

How Ousted Company Leaders Continue To "Manage From The Grave"

Lucy Marcus makes some excellent points in this article from Reuters' Blogs: Lead from the front, or manage from the grave? | Lucy P. Marcus

She shows how boards of directors at RIM, and Yahoo, are making serious mistakes in their efforts to revitalize their businesses with new leaders. They don't take the necessary steps to cut off the influence of the former, discredited management teams, on the organization. Appointing a new CEO will change little.

BlackBerry maker Research In Motion (RIM) has finally rid itself of its founders' disastrous co-CEO/co-chair setup. Yet the stamp of the old management team is still very much in evidence. The founders continue to have a strong presence in the company, with both remaining as board members, and Mike Lazaridis staying on to head a newly created innovation committee.

RIM needs revolution, not evolution, and yet it has chosen to replace its co-CEOs with a company insider, Thorsten Heins, one of RIM's two chief operating officers.

Another example:

Yahoo's decision to hire a new CEO before refreshing its board may prove to be a real detriment to fundamental change, again demonstrating a desire to "manage from the grave."

Jerry Yang may have left, and several other board members may be leaving as well, but by appointing the new CEO itself, the outgoing board has set the company on a path that a new board with fresh perspective might not see as the best way forward.

She explains how this leads to the loss of trust with investors -- and serves to undermine the credibility of the new CEO.

...this CEO will always be perceived as "of the past board" and will have to work that much harder to build trust with the new board and investors.

She offers some solutions on preventing the old regime from continuing its influence. You can read the full article here:

Lead from the front, or manage from the grave? | Lucy P. Marcus