Vista and Me: Dealing with CEOs to Avoid a Crisis

Rob Enderle

Windows Vista was an ugly birth for a lot of reasons. I've seen far worse in my years in terms of product quality, even from Microsoft (DOS 5.0, Office 1997, and Windows ME were all worse, in my opinion), but none has had the impact on the PC industry that Windows Vista has had.

 

Certainly, it has made Apple's year (it continues to outspend Microsoft on strong marketing) and motivated the OEMs to take better control over the user experience. In the end, I think Windows 7 will be vastly better because Windows Vista stumbled. In fact, it better because Apple is gaining ground in the enterprise. But rather than talk about that eventuality, I'd like to talk about dealing with CEOs in a crisis.

 

This topic was prompted by the disclosure of several e-mails that highlight my largely failed attempt to correct a number of initial problems with Windows Vista before it shipped. The entire purpose of an analyst is to prevent problems, not say, "I told you so." This trip down memory lane simply reminded me that I haven't come up with a silver bullet to prevent what I generally see as obvious problems. I can also tell you that the financial reward for speaking out generally isn't close to the financial cost; although I think that being forthright is the only way to live, those that depend on you may disagree, and you do need to consider them.

 

Bad Times Put Internal Focus on CEOs

 

Over the next several years, I expect most of you will feel your CEO doesn't understand what is going on. You may feel motivated, as I clearly did in the disclosed e-mails, to give the man or woman a clue and perhaps avoid a disaster that seems very evident to those in the trenches. I imagine nearly every U.S. automobile employee is thinking their CEO is particularly clueless at the moment. My point is that none of us are alone or the first to feel this way. I actually became an external analyst because I was frustrated by my inability to prevent problems I'd accurately forecast as an internal analyst. But, as you can see from the Vista example, my influence, though greater now, often isn't great enough.


 

The Isolated CEO

 

I subscribe to the theory that every CEO lacks the capability to do what most would like them to do. This is more a statement of our limitations as humans than it is a slam on CEOs. I trained to be a CEO for a multi-national and one thing you learn really quickly is that there is simply too much data to assimilate and way too much complexity to deal with personally. This is why you have to delegate and trust the people you delegate to. The downside is that every CEO becomes isolated from the business. The more complex the business, the more isolated the CEO.

 

One of Steve Jobs' initial brilliant moves, out of the Inside Steve's Brain book, was to eliminate much of Apple's complexity so he could take a somewhat unique hands-on approach to the products. You can generally go back and see products that came out when he is was distracted because they have problems that products he has focused on do not. But the Steve Jobs approach can't scale, which is why Apple remains a limited product company, even though it enjoys some of the highest NPS (Quality) scores in its segment.

 

Ever since I observed this disconnection problem while working at IBM, I've been trying to think out a way to assure that the person at the top of the company isn't isolated and doesn't become blindsided. I've pitched the idea of an internal intelligence organization, but the problem with that is it seems to imply a lack of trust with line managers. And politically, it just doesn't seem doable as a standalone organization. We tried to get Internal Audit to take up this mantle while at IBM, and had some success, until we eventually stepped on the wrong toes and were handed our walking papers. But two companies are apparently working this out.

 

Both HP and EMC have effectively created internal intelligence organizations and the performance of these companies, I think, showcases that this can work. EMC uses the quality organization, which reports up to the CEO to monitor each of the individual units and keep the CEO focused on what needs to be addressed to assure customer quality and loyalty.

 

For HP, it is Shane Robison's technology office. (I think Robison should be up for the U.S. CTO spot.) It performs a similar role, assuring that divisions are collaborating and providing early warning to the CEO about impending problems. In both cases, the CEOs remain tightly focused on the financial performance of their divisions, but with these additional information sources appear vastly more able to anticipate and deal with problems before they become catastrophes.

 

Is the CEO the Right Person?

 

Before going up-line to the top of a company with a problem, you really need to do some soul searching and determine whether it has more to do with you than it does with the company. The world does not revolve around each of us, but our perception of things tends to be very focused on our own frame of reference. Generally, jumping chain of authority is a career killer. Doing it for the wrong reason is pointlessly suicidal.

 

Now, you have to figure out if the problem is a CEO problem or belongs with some other person in the organization. It is easy to assume that the top guy owns everything, but the reality is they don't, at least not really. The CEO just doesn't have the breadth to cover or be interested in everything. Chances are you really need to talk to someone else. Spending time finding out who that is will both make you more successful and better protect your career.

 

Finally, can the CEO do anything about it? For a lot of problems, the CEO does know about them, may actually have mentioned them, but is either unable or unwilling to make the needed changes. In the instance that started this out, I went to Steve Ballmer as a last-ditch effort to fix what I saw as a serious problem with Vista. But Steve was engaged with other things and never engaged to address the problems I was highlighting. It is with some sense of irony that I'm seeing my own e-mails used by the plaintiffs in the class action to indicate that he was engaged even though, had he been, the basis for their litigation wouldn't have existed.

 

Approaching the CEO

 

Best, and by best I mean most successful with the least risk (with a noted exception), is to approach your CEO through someone that they trust. CEOs typically surround themselves with trusted advisors, both personal and professional. The personal ones are often harder to find but easier to approach; however, they are also the most dangerous. Top executives learn to compartmentalize their lives and can get very angry if they find an employee is attempting to get their attention by going through a personal friend or family member. But find someone who has the CEO's business ear and see if you can convince them to give you an introduction. That alone, assuming you don't have a relationship with the CEO, will establish your credibility and give you an audience.

 

Prep what you are going to say. The more you ramble and stammer, the less credible you appear. You probably have about three minutes to get and hold the attention of any top executive. After that, if you haven't got their attention, the lights are on but nobody is home. The very first time I had a CEO audience, I wasn't prepared. The long deer-in-the-headlights look on my face made this the one and only meeting like this I had.

 

Have a plan to fix the problem. Anyone can see problems, but if you can't figure out how to fix it, you didn't provide much value, and the issues you have raised probably won't flow to the top. Be aware that there is some risk that you might actually be asked to fix the problem. In those rare occurrences, if you are successful, you could be fast tracked in the firm.

 

Finally, if you don't get the support of the CEO or executive, lose graciously. Don't throw a tantrum. And if it turns out you were right, don't do the "I told you so" thing either. They may listen to you next time, but not if you appear to be unable to control your temper, and "I told you so" gets old even before you say it. Let others do that for you.



Add Comment      Leave a comment on this blog post
Nov 25, 2008 2:14 AM Rob Enderle Rob Enderle  says:
Not with respect to where the two companies actually compete. The $300M campaign is a multi-year move spreading this across nearly 3 years still placing Apple in the lead where they compete. The commercial used as the example of hypocracy is the one focused on Vista and here Apple outspends Microsoft significantly. I actually think Microsoft should spend more and use Apple as an example of how the money should be spent. But given the recent election I think it in poor form to critisize Microsoft's spending on Vista when Apple outspends them on their desktop platform. Reply
Nov 25, 2008 2:22 AM james jaeger james jaeger  says:
The site you cite to support Apple's spending more on advertising than Microsoft has been updated to say something totally different. Reply
Dec 5, 2008 4:45 AM wwwpassk wwwpassk  says:
very good Reply

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