Too many high flyers wind up like Icarus. They begin by working their wings hard and using them to soar. But then something changes, their wings fail them, and they fall to earth. Here are three classic ways it happens.
Bob Nardelli at Home Depot
Bob Nardelli had been a superstar at General Electric. He was one of three finalists for the CEO job there.
When he didn’t get it, he was snapped up within days by Home Depot. They had been the fastest growing company in the US for a decade by following founder Bernie Marcus’ mantra to “love the customer.”
Nardelli and the Home Depot board must have figured that their customers loved them too much to leave. So they set about gutting the very things that had made Home Depot successful as they worked to make it more efficient.
Soon the customers were gone and the shareholders were angry. Nardelli was sent packing (with a suitcase full of money).
Icarus fell to earth. It happened because Bob Nardelli thought he didn’t have to adapt to a new company and industry. He figured it was their job to adapt to him.
Scott Edmunds at Chico’s
Scott Edmunds was a star CEO at Chico’s FAS. He delivered quarter after quarter of growth.
He started several new businesses. He kept opening stores. He bought land and began construction of a new corporate headquarters. Soon the stock that had traded around $50 per share sank to below $10. The board replaced Edmunds as CEO.
Icarus fell to earth. It happened because Edmunds began to believe that he didn’t have to abide by normal limits. He seemed to think he could do anything.
Ron Allen at Delta Airlines
Ron Allen was the inside star that took over Delta Airlines in 1987. At the time Delta was the premier airline for business travel. It had weathered deregulation in good financial condition. And it had some of the best employee relations in the industry.
Allen wanted to make his mark on the company, so he changed just about everything. A decade later, Delta had gone from being the premier airline for business travel, with great employee morale and a solid balance sheet, to being just another struggling airline with labor problems.
Icarus fell to earth. It happened because Allen thought it was more important to make his mark on the company than it was to leave it better than he found it.
High fliers fall to earth when they start thinking it’s all about them.