When Strong Men Resign: Whither AIG After Greenberg? (Revised)
So the board of directors of AIG, according to the Wall Street Journal, is close to jettisoning long-time CEO, Strong Man “Hank” Greenberg, as a tide of regulatory problems at AIG rises ever-closer to the executive suite that Greenberg ruled with an iron fist.
I know ex-AIG veterans, and they swear by Greenberg and his get-it-done, make-the-numbers, show-the-growth style. He came into a small, insular company and made it a Wall Street fave and an insurance industry steamroller. But what problems has he steamrolled along the way?
Time will tell, and I have no particular insights into AIG itself–perhaps a reader or two may enlighten this page. But I can not name a single company of the get-it-done, make-the-numbers, show-the-growth type that has not uncovered vast problems–from the billions of dollars in overstated earnings at Tyco to the vast channel-stuffing uncovered at Coke–whether the Strong Man has retired in glory or resigned in disgrace.
Think about them: Tyco afterKozlowski; Coke after Goizueta; GE after Welch; Enron after Lay; Worldcom after Ebbers; Pfizer after McKinnell (McKinnell is still there, but the problems are already surfacing)…
It will be very interesting to see what the regulators uncover now that Greenberg is out at AIG. My guess–an educated guess–is that it will get much worse before it gets better.
Jeff Matthews I’m Not Making This Up
P.S. My first draft of this piece omitted two of the most obvious of all Strong Men: Sandy Weill, whose heir Chuck Prince is dealing with festering problems at Citibanks all over the world; and Michael Eisner, Disney control-freak extraordinaire finally yielding to–or perhaps more like installing–former weatherman Robert Iger in his place.