How Some CEOs Successfully Run More Than One Company
Cheryl Strauss Einhorn
The Barron's article, “How Some CEOs Successfully Run More Than One Company," quoted Russell Reynolds Associates Consultant Constantine Alexandrakis on the skepticism that boards likely feel when their CEOs run multiple companies at once. The article is excerpted below.
Amazon.com, Renault, Tesla, and Twitter are very different companies, but they have one common denominator: Their chief executives also run other companies.
Jeff Bezos shuttles between Amazon (ticker: AMZN) in Seattle and Kent, Wash.-based rocket company Blue Origin. Carlos Ghosn steers auto companies on two continents: Renault (RNO.France) in France and Nissan Motor (7201. Japan) and Mitsubishi Motors (7211.Japan) in Japan. Jack Dorsey toggles between Twitter (TWTR) and Square (SQ) in San Francisco. Elon Musk transports himself between Tesla (TWTR) in Fremont, Calif., and rocket maker Space X, farther south, in Hawthorne.
The model for such CEOs is, of course, Steve Jobs, who co-founded Apple (AAPL) and much later purchased and headed what became Pixar. However, Jobs captained both companies for only one year, which he called “rough, really rough, the worst time in my life.”
How are today’s superstar multitasking CEOs doing it? And what is the personal cost to their profit-driven lives?
Constantine Alexandrakis, head of U.S. business for head-hunting firm Russell Reynolds Associates, agrees. “It’s a hard sell for a board of directors because running just one company should take 150% of a CEO’s attention,” he says. “How would the CEO split his time between entities, and how would it all work?”
The issue for boards of directors and investors is to understand how part-time CEOs organize their time and their decision-making, since “it’s likely to happen more often,” predicts Alexandrakis of Russell Reynolds. “As the world becomes more connected and industries become more intertwined, we may see more companies coming together, and that could result in more of this phenomenon.”
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