In Business This Week: HEADLINER: STEPHEN WOLF
BACK IN THE COCKPIT
If airline exec Stephen Wolf ever pens a management book, it'll have three chapters: 1) Extract worker concessions by threatening to dismantle the company. 2) Sell the company. 3) Cash out royally. That's what experts figure he'll do at USAir, where he was named chief executive on Jan. 16.
Wolf employed such a strategy at Republic Airlines and at Flying Tiger; he sold United Airlines to employees in 1994 before departing with $10 million in cash and stock options. Former colleagues were surprised that the turnaround ace, 54, would jump back into the cockpit so soon. After leaving United, Wolf seemed eager to spend time restoring vintage Jaguars, running his foundation for poor youths, and touring Paris cafes.
Why go back to work so soon? One ex-colleague thinks Wolf wants to dispel his image as a bad guy. But Wolf may face his toughest foe yet in USAir's unions. "Obviously Wolf is going to beat up on employees, and it's our job to stop him," warns Ken Thiede, chief of the airline's machinists' union.By Dean Foust in WashingtonReturn to top
WAL-MART: A STRING SNAPS
OUCH. AFTER EARNINGS GAINS for 99 straight quarters, Wal-Mart said on Jan. 17 that weak holiday sales and intense competition will cause its fourth-quarter profits to drop as much as 11% from the same period a year ago. Analysts expect the retailer to earn $97 million on sales of $27 billion for the quarter. More bad news for Wal-Mart comes from China. Joe Hatfield, Wal-Mart's chief operating officer for China/Hong Kong, confirms that Wal-Mart's once-promising joint venture with Thai conglomerate Charoen Pokphand Group to operate discount stores in China has fallen apart. Industry sources say the partners couldn't decide who would be boss. Wal-Mart now plans to open stores in China on its own.Edited by Thane PetersonReturn to top
BIONDI GETS THE BOOT
VIACOM CEO FRANK BIONDI was ousted unexpectedly on Jan. 17 from the company he had helped build into an entertainment giant. Biondi and Chairman Sumner Redstone had clashed over Biondi's laid-back management style for some time, says a source close to the situation, and Viacom's disappointing summer films and lagging share price didn't help. The board, advised of a special meeting to decide the issue only the night before, voted unanimously to boot Biondi. Redstone will take on the company's CEO duties. "Frank's great. But with the challenges we have, we need a more entrepreneurial, hands-on" style, Redstone says.Edited by Thane PetersonReturn to top
DUELING TITLES AT AT&T
IS ALEX MANDL AT&T'S NEXT chairman? Or John Zeglis? Mandl, 52, became the favorite on Jan. 17 when 60-year-old Robert Allen named him president and chief operating officer, effective after AT&T splits into three parts sometime before the end of 1997. Mandl was also named to a new "chairman's office" and chairman of a new Global Operations Council. But chief counsel Zeglis picked up titles, too: He becomes a senior executive vice-president, chairman's office member, and head of a new Executive Policy Council.Edited by Thane PetersonReturn to top