Charismatic founders leave behind a huge hole to fill
Published 26/08/2011 | 05:00
FEW chief executives are so closely associated with their companies as Steve Jobs but the man who founded and then rescued Apple is not unique.
Here in Ireland, Michael O'Leary has become the face and voice of Ryanair, while Michael Smurfit was synonymous with his eponymous listed paper company for decades.
Charismatic and successful chief executives pose particular problems for their successors; especially if they also founded the company.
"Succeeding an icon is a job you want to be very careful about accepting," Professor Andrew Ward, of Pennsylvania's Lehigh University, said at a conference in London recently. "History shows companies often flounder once the icon departs."
Who would really want to succeed Warren Buffett or Rupert Murdoch, for example?
Corporate America's tendency to idolise chief executives created problems for large companies such as General Electric and Disney.
"At Disney, people were still asking 'What would Walt do?' 30 years after his death," said Prof Ward.
Back in Ireland, few chief executives achieve the sort of superstar status afforded to their US counterparts, but the record is mixed when it comes to departures.
The Smurfit paper empire has thrived since Michael Smurfit stood down, although companies closely associated with the founders, such as DCC, have struggled.
DCC's share price sank to €10.05 in the wake of founder Jim Flavin's resignation following a court case and is still a long way from the €28 high.
A company that managed its succession well is Kerry, which has seen its shares and profits rise steadily since the well-flagged resignation of Denis Brosnan, the man who turned the company from a sleepy dairy firm into a global champion during the 1980s.