In comes Stanford John...
Donahoe has his own ideas to take Whitman’s legacy to the next level
Very rarely does one come across leaders, who not only dramatically
transform fortunes of companies, but most interestingly, come on board with a pre-decided tenure! One such leader who beautifully joins the league is the sterling 52-year-old CEO of eBay Inc. – Margaret C. Whitman. When she took on the scepter of CEO in 1998, she made it very clear that a decade is a fairly good time for a CEO at the helm of a company. And her resignation comes precisely after ten years on March 1, 2008. “It’s important that new perspectives & new eyes come to the company. It’s tough to stay fresh, no matter who you are,” admitted Whitman on January 24. She will be replaced by John Donahoe, currently President of eBay Marketplaces, effective March 31, 2008. Ironically, the contrast between the two perhaps could not have been more striking, far beyond the Harvard-Stanford face-off (Meg is a Harvard alumnus & John is a Stanford graduate).
While Whitman has almost always tackled corporate growth issues using macro-strategies, John – who was the worldwide MD of Bain and Co. for five years before joining eBay in 2005 – has more or less focused on micro-process issues. Consider this. When, in 1998, eBay suffered debilitatingly due to lack of funding, Whitman initiated a massive IPO to fund its expansion plans. Her acquisition of online payment service PayPal in 2002 for $1.5 billion gave a much required boost to eBay, & consolidated its stranglehold in online auction business. In 1998, the 30-employee-strong eBay had a meagre 5,00,000 registered users. Today it has a mind numbing 83.2 million active users & $7.7 billion in revenue. With 15,000 employees & growing, it is the world’s largest e-commerce site.
John’s has a more customer focussed agenda, which includes upgradation of the site, revision of fee structure (he wants to lower the fees paid by people to list items & raise commission that eBay would earn on successful sales), and increasing search exposure for sellers with best buyer-satisfaction ratings. John prophetically commented, “Sellers that describe items accurately, ship on time & ship at a fair price will enjoy preferential pricing & discounts... this will significantly improve the buyer’s experience overall.”
Even the much praised Whitman has had her share of gut hits, notable being her open gamble to acquire Internet telephone service Skype last year for $2.6 billion. Skype did not generate expected revenues; worse, as its value fell, eBay had to write down a killing $1.4 billion. In fact, despite eBay seeing profits rise radically from 2004 to 2006 ($7.84 to $11.26 billion), Morgan Stanley quoted to B&E that the Skype acquisition was one of the chief reasons for a tremendous fall in eBay’s 2007 profits of $3.48 billion. Even Skype’s user and operating metrics decelerated across the board for the fifth consecutive quarter on December 31, 2007. Still, as Whitman announced her exit, eBay’s share value dropped almost instantly, dropping 6.1% to $27.18 before closing on January 25, 2008 at a 52-week low of $26.83, though Whitman did say of the new CEO Donahoe, “I’m extremely confident in John’s skills and the abilities of his veteran management team.”
They say it’s tough to become number one, but tougher to stay there! While Whitman has already showcased her cutting edge competitive skills to bring eBay to numero uno position in e-commerce, one wonders how much ‘tougher’ will John allow it to get to keep hold of that position! We don’t think it’ll take a decade for us to know that, eh!
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
Very rarely does one come across leaders, who not only dramatically
transform fortunes of companies, but most interestingly, come on board with a pre-decided tenure! One such leader who beautifully joins the league is the sterling 52-year-old CEO of eBay Inc. – Margaret C. Whitman. When she took on the scepter of CEO in 1998, she made it very clear that a decade is a fairly good time for a CEO at the helm of a company. And her resignation comes precisely after ten years on March 1, 2008. “It’s important that new perspectives & new eyes come to the company. It’s tough to stay fresh, no matter who you are,” admitted Whitman on January 24. She will be replaced by John Donahoe, currently President of eBay Marketplaces, effective March 31, 2008. Ironically, the contrast between the two perhaps could not have been more striking, far beyond the Harvard-Stanford face-off (Meg is a Harvard alumnus & John is a Stanford graduate).While Whitman has almost always tackled corporate growth issues using macro-strategies, John – who was the worldwide MD of Bain and Co. for five years before joining eBay in 2005 – has more or less focused on micro-process issues. Consider this. When, in 1998, eBay suffered debilitatingly due to lack of funding, Whitman initiated a massive IPO to fund its expansion plans. Her acquisition of online payment service PayPal in 2002 for $1.5 billion gave a much required boost to eBay, & consolidated its stranglehold in online auction business. In 1998, the 30-employee-strong eBay had a meagre 5,00,000 registered users. Today it has a mind numbing 83.2 million active users & $7.7 billion in revenue. With 15,000 employees & growing, it is the world’s largest e-commerce site.
John’s has a more customer focussed agenda, which includes upgradation of the site, revision of fee structure (he wants to lower the fees paid by people to list items & raise commission that eBay would earn on successful sales), and increasing search exposure for sellers with best buyer-satisfaction ratings. John prophetically commented, “Sellers that describe items accurately, ship on time & ship at a fair price will enjoy preferential pricing & discounts... this will significantly improve the buyer’s experience overall.”
Even the much praised Whitman has had her share of gut hits, notable being her open gamble to acquire Internet telephone service Skype last year for $2.6 billion. Skype did not generate expected revenues; worse, as its value fell, eBay had to write down a killing $1.4 billion. In fact, despite eBay seeing profits rise radically from 2004 to 2006 ($7.84 to $11.26 billion), Morgan Stanley quoted to B&E that the Skype acquisition was one of the chief reasons for a tremendous fall in eBay’s 2007 profits of $3.48 billion. Even Skype’s user and operating metrics decelerated across the board for the fifth consecutive quarter on December 31, 2007. Still, as Whitman announced her exit, eBay’s share value dropped almost instantly, dropping 6.1% to $27.18 before closing on January 25, 2008 at a 52-week low of $26.83, though Whitman did say of the new CEO Donahoe, “I’m extremely confident in John’s skills and the abilities of his veteran management team.”
They say it’s tough to become number one, but tougher to stay there! While Whitman has already showcased her cutting edge competitive skills to bring eBay to numero uno position in e-commerce, one wonders how much ‘tougher’ will John allow it to get to keep hold of that position! We don’t think it’ll take a decade for us to know that, eh!
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
Read these article :-
ZEE BUSINESS BEST B SCHOOL SURVEY
B-schooled in India, Placed Abroad (Print Version)
IIPM in Financial times (Print Version)
IIPM makes business education truly global (Print Version)
The Indian Institute of Planning and Management (IIPM)
IIPM Campus
Top Articles on IIPM:-
'This is one of Big B's best performances'
IIPM to come up at Rajarhat
IIPM awards four Bengali novelists
IIPM makes business education truly global-Education-The Times of ...
The Hindu : Education Plus : Honour for IIPM
IIPM ranked No.1 B-School in India, Management News - By ...
IIPM Ranked No1 B-School in India
Moneycontrol >> News >> Press- News >> IIPM ranked No1 B-School in ...
IIPM ranked No. 1 B-school in India- Zee Business Survey ...
IIPM ranked No1 B-School in India :: Education, Careers ...
The Hindu Business Line : IIPM placements hit a high of over 2000 jobs
Deccan Herald - IIPM ranked as top B-School in India
India eNews - IIPM Ranked No1 B-School in India
IIPM Delhi - Indian Institute of Planning and Management New Delhi ...domain-b.com : IIPM ranked ahead of IIMs
Labels: 4ps, ARINDAM CHAUDHURI, BUSINESS AND ECONOMY, Guru economist, IIPM, iipm-article, iipm-press, iipm-publications, management guru, news weekly, renowned management guru, the Sunday indian
posted by Editorial at
3:56 PM
0 Comments
theatre has witnessed businessmen donning almost every other hat – a steel maker becomes an IT giant, a liquor baron turns into an aviation maestro, oil tycoons transform into retail magnates, real estate players are successful as telecom majors, and the list goes on. Whenever such businessman entered a new sector, which was different from their core one, they took the existing competition by storm and became a dictating force in that arena. Surprisingly, what the world hasn’t witnessed is experienced real estate players emerging as successful hoteliers.
fauna than any other! The great botanical and zoological miscellany is owing to the fact that the islands had been uninhabited for a very long time and it was not before the French occupation of Seychelles (named after the French politician Jean Moreau de Séchelles) that some human settlement started to take roots… post which the British established colonies there.
presidency. Instead of transforming the economic situation as expected, Unlike his predecessors, he has let the media write & speculate on his personal life.
otherwise…and the death of the same, leads to death of those words which would have been spoken otherwise. The murder of more than 16 country singers in Mexico, has evoked quite a furor as the secret of the delirious deaths has also gone to the grave, along with the songsters.
bid for English steel-maker, Corus. A year later, that’s a $12.1 billion worth chapter in M&A books – the biggest ever by an Indian company – making the Tata Steel & Corus combine the 6th largest globally, with a total annual steel capacity of 25.6 million tonnes! That’s Tata Steel for you, growing amidst drama & against all odds.
inversely proportional to the optimism of Ben Bernanke. Declining home prices, rising foreclosure rates, a weak dollar and high oil prices; not to mention a crisis of confidence in the credit markets, yet, if Ben were to be believed, all suggest a period of moderate, but positive growth going forward.
rabble rousing word, in the Indian lexicon, since the emergence of economic liberalisation. Every attempt to privatise Indian PSUs has not only been greeted with serious resistance by Opposition parties, it has also been termed as attempt to sell off ‘National Assets’ or ‘Family Silver.’ While national parties like BJP & Congress have taken turns to oppose it, depending on whether they are in government or in Opposition, the Left parties have always been opposed to it. In 2004, in an article in rediff.com, CPI General Secretary A. B. Bardhan stated, ‘It was National Democratic Alliance Government that set up the first ever Divestment Ministry. It virtually put India up for sale: it set up a shop to sell off prime national assets.’
world of The Matrix – a computer generated world that’s almost indistinguishable from reality. To quote Morpheus again, “Have you ever had a dream that you thought was so real, that if you woke up, how would you know the real world from the dream world?” Sooner or later, the technology will allow us to step into the screen instead of simply staring at it.
control over global mobile market? Or is it just another CSR act? “Nokia’s decision to launch eco-friendly mobile in India is more of building a brand image than a strategy to increase or recover its lost market share,” opines Shushmul Maheshwari, CEO, RNCOS e-Services. But will an improvement in brand goodwill not boost its sales and topline? Pat comes Maheshwari’s response, “No! This move is not expected to benefit the company in increasing its sales or market penetration as Indian consumers have low awareness regarding green products (eco-friendly) as compared to his western counterpart...”
being infused into the natural resource sector, it is undoubtedly in the midst of a super cycle and investors can certainly cash in on the benefits by investing in such funds. Natural resources funds will also help reduce portfolio volatility and provide a hedge against the ever rising inflation. Further; as industrialisation and urbanisation increase the intensity of consumption of natural resources, the demand for natural resource will fast outpace the supply and thus in the foreseeable future the prices of natural resources can only go up.
When ArcelorMittal acquired the Gandrange facility in Eastern France in 1999, little was known that the plant will become a source of disdain. Due to unprofitability and a poor market, when the company wanted to offload close to 575 workers, the workers ransacked the company office. But for those wondering if this indicates there could be trouble in Mittal’s paradise, we must understand it’s a one off case. Mittal’s expansions gives him an excellent leeway in the steel industry. Some tactical blunders do not question the merit of his ingenious strategy; but then, damage control is one area that he may well have to be adept at.
