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Martha Stewart Living Omnimedia CEO Susan Lyne has stepped down. Replacing her is not one, but two CEOs—and no, neither of them is Martha. They are Robin Marino, MSLO’s president of merchandising and former president of Kate Spade, and Wenda Harris Millard, president of media and former Yahoo sales chief. The two “co-CEOs,” who are not named as interim choices, will both report to Charles Koppelman, the chairman of the board.
There is little explanation for Lyne’s departure in the company’s announcement. In a statement, Lyne says that when she was asked to take on the role four years ago (while Stewart was in prison for lying to government officials about her infamous ImClone Systems stock sale), “our principal goal was to rebuild the company and return it to profitability. We have done that.” That’s true: 2007 profits reached $10.3 million, up from a loss of $17 million in 2006. But shares in the company’s stock have also fallen 55% over the past year.
Whatever the reason for Lyne’s departure, the choice of two co-CEOs is a rare one. Sometimes, it helps for succession purposes, to transition in a new CEO. In lower ranks, the combination of people with two sets of skills—a technologist and a sales guy sharing a managerial role, for instance—can also work well.
But when it comes to the buck-stops-here job of the CEO or Chairman, a dual management structure is fraught with peril. Many management experts agree the concept is difficult at best. Power sharing that occurs after a merger—such as John Reed and Sandy Weill’s brief joint running of Citigroup following the Travelers Corp. merger—can be a recipe for disaster. Joining forces with a founder, as David Pottruck and Charles Schwab did, can also be tricky, especially if the new leader doesn’t equally share power. (Pottruck was summarily ousted in 2004.) And when the dual chief system is cross-cultural, such as the cumbersome management set-up at European EADS, which ditched its French and German co-CEO structure last year, it can prompt intense political infighting.
Marino and Millard could, of course, make it work. Marino brings merchandising chops to the job, while Millard brings online advertising expertise, so their skills seem like a winning fit. Rightly or wrongly, a leadership trait frequently assigned to women is their ability to collaborate, so Marino and Millard could prove to be a great test case. But whatever their success in working together, they won’t just have to battle their own egos. In this case, they’ll both need to contend with yet another powerful force: domestic guru Martha herself.
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