What Companies Expect from Their CEOs

While I agree that U.S. boards of directors seem ever more willing to drop the trap door under their CEOs, firing the chief is only the tip of the governance iceberg (''The CEO Trap,'' Cover Story, Dec. 11). For every such CEO mutiny launched by impatient boards, there are a dozen cases of boardroom insubordination, such as the thumbs-down that Coca-Cola Co.'s board gave CEO Douglas N. Daft's plan to acquire Quaker Oats Co. in November.

While such activism shows a newfound board seriousness on shareholder value, the long-term consequences are very uncertain. When a CEO is ousted, the analysts, investors, and other corporations can at least assume that the new leader will have the final say for the company. But when CEOs are increasingly second-guessed by their directors, have we replaced the imperial CEO with imperial boards?

Ralph D. Ward
Publisher, Boardroom INSIDER
Riverdale, Mich.


Some corporate boards have overlooked two developments that should drastically alter the role and expectations of the 21st century CEO: teamwork and knowledge creation. Teamwork has become the driver of most successful companies today, for we realize the benefits of collaboration. It is odd that this focus on teamwork has not been extended to the CEO's office. Why are teams crucial to the success of individual projects, yet we charge a single person with running the entire company? Wouldn't it make more sense to have a true team running the organization?

Also, the key to many companies' value today is knowledge creation. But the last thing the experts who are creating knowledge need is a powerful superhero CEO telling them what to do. Instead, the CEO office should facilitate the work of the experts and stay out of the way as much as possible. Until more boards focus on these issues, CEOs will continue to get too much credit when things are good and too much blame when they are bad.

Dana R. Hermanson
Corporate Governance Center
Kennesaw State University
Kennesaw, Ga.

AT&T Is Paving the Broadband Highway

''Why most of us can't have broadband'' (Technology & You, Dec. 4) claims that AT&T has abandoned plans to provide voice and data over the cable networks we purchased. The story: ''Who will finance the overhaul of the nation's largest cable network'' following AT&T's restructuring?

In fact, more than 75% of those networks will have been upgraded for two-way digital communication by the end of this year. AT&T Broadband recently added its 500,000th cable telephony customer--more than any other U.S. cable company. That's up from 79,000 at the beginning of the year. And AT&T Broadband also recently added its 1 millionth high-speed data customer--more than any other cable company.

The pace at which we have been installing those services has increased sharply throughout the year and will continue in the coming months. With a revenue increase of nearly 11% in the third quarter and with $9.3 billion in revenue over the past 12 months, AT&T Broadband is on track to be financially and operationally ready to continue its success. And it will continue to operate under the AT&T brand. I would hardly call that abandoning our plan.

Dick Martin
Executive Vice-President
AT&T
Basking Ridge, N.J.

OSHA's Approach: Government Knows Best

Charles Haddad got one thing right in ''OSHA's new regs will ease the pain--for everybody'' (Workplace, Dec. 4). Thousands of companies have indeed implemented programs to limit repetitive-stress injury complaints, with great success. According to the Labor Dept., such injuries have declined 34% over the past three years.

The problem is that none of the companies cited as shining examples--all of them members of the National Association of Manufacturers--has ergonomics programs that meet the Occupational Safety & Health Administration's stringent standards. In fact, no company in the country would measure up. And therein lies the business community's problem with the regulation: It is a ''government knows best'' approach at a time when free-market forces already are working to address employee needs. Worse, the regulation expands OSHA's reach beyond the workplace and into the homes, softball fields, and bowling alleys of America by defining work-related injuries as those only aggravated by, not necessarily caused by, work. Sweeping, one-size-fits-all, command-and-control rules don't ease the pain. They are a pain.

Patrick Cleary
Vice-President, National Association of Manufacturers
Washington

What the Big City Papers Are Up Against

''Ready for some old-fashioned paper wars? (Media, Dec. 11) missed part of the story. In the new millennium, changes in demographics and technology will have a bigger impact on the news media than the circulation wars of old.

More people are now receiving their news from the Internet. Others tune in to free radio and TV stations, which have several news broadcasts daily. Don't forget the various cable news stations such as CNN, CNBC, Fox, etc., which provide up-to-the-minute coverage for fast-breaking news that becomes stale by the time it reaches print the next day.

Diverse groups of immigrants, meanwhile, will continue supporting their own foreign-language newspapers, radio, and cable-TV stations. Based on the 2000 census, Honolulu, San Francisco, and Seattle have all gained a number of new residents fluent in more than one language. As these competitors grow, may the new Honolulu Star-Bulletin, San Francisco Examiner, and Seattle Times continue to prosper in the marketplace of ideas.

Larry Penner
Great Neck, N.Y.

The Clear Voice of Small Business

In ''Small business, big spender'' (Business Week frontier, Dec. 4), you reported that the National Federation of Independent Business (NFIB), ''the No. 1 small-biz lobby,'' spent a record $8 million on 30 congressional candidates, 15 of whom won their races, which put the cost per victory for NFIB at $530,000. While NFIB did spend a record $8 million on political activity in the 2000 election cycle, that funding was used on far more than 30 congressional races.

While NFIB was active in 30 of the most hotly contested congressional campaigns that would affect America's small-business owners, we endorsed candidates in a total of 298 congressional, gubernatorial, and other campaigns. NFIB's endorsed candidates won 242 of those 298 races, for a winning 81%.

NFIB also helped elect pro-small-business candidates in ways that cannot be measured with a calculator. More than 20,000 NFIB members were recruited as campaign volunteers and trained in effective political involvement. This grassroots organization helped make the difference in several close congressional elections. NFIB's success in preserving a pro-small-business majority in Congress shows that Main Street is a political force to be reckoned with in future elections. Small business is the engine that makes our economy run, and political candidates who ignore Main Street do so at their own peril.

Tony Likins
National Federation
of Independent Business
Washington

The Uphill Battle against Global Warming

''It's perfect weather to fight global warming'' (News: Analysis & Commentary, Dec. 11) illustrates the dictum that the devil is in the details. Raeburn's acknowledgement that ''there will be some pain'' is an understatement. The Energy Dept. study is a study by five national labs that revisits policies that have been proposed and rejected before. Even its ''advanced scenario'' would theoretically get the U.S. little more than half of its Kyoto emission-reduction target by 2010.

What's in this scenario? Key elements include a ''voluntary'' 45%-50% increase in Corporate Average Fuel Economy standards, replacing our premiums for a minimum level of vehicle liability insurance with a gasoline tax of 34 cents a gallon, and instituting a $50-per-metric-ton ''tradable carbon emission permit programs.'' The tradable carbon permit scheme alone would collect $73 billion in ''energy taxes'' from individuals and businesses in 2010. The five-lab study itself acknowledges that these policies would raise gasoline prices 29%, natural gas prices 13%, and coal prices 120%.

How practical is all this? Right now politicians are trying to lower world oil prices, release the strategic petroleum reserve, and express concern about the impact on consumers of high price for natural gas, heating oil, and electricity--just the opposite of what the five-lab study proposes.

Russell O. Jones
Senior Economist
American Petroleum Institute
Washington

''Curing an industry's ills'' (e.biz, Dec. 11, 2000)

In ''Curing an industry's ills'' (e.biz, Dec. 11), the stock prices of DrKoop.com Inc. and WebMD Corp. should have been listed as follows: DrKoop shares have fallen by 97.5%, to one-fortieth of their former value, and WebMD shares have plummeted 83.33%, to one-sixth their former value.

''Microsoft's little bro''' (Information Technology, Dec. 11, 2000)

The meaning of a quote in ''Microsoft's little bro''' (Information Technology, Dec. 11) was inadvertently changed. Carl Lenz, research director at Gartner Group, meant that Microsoft Corp. would not likely be a leader in business-to-business software applications.

''Workers of the world: Welcome'' (Government, Nov. 20, 2000)

A table accompanying ''Workers of the world: Welcome'' (Government, Nov. 20) should have stated that 530,000 immigrants entered the U.S. between 1931 and 1940.