Peeling away the layers of a great CEO

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By Denzil Doyle

In my last article, I discussed the tendency of key stakeholders in a high technology company to call for the CEO’s resignation at the first sign of trouble, particularly if the CEO is a technical person who lacks “business management” experience. The pressure for change is usually strongest from the financial community. My advice to a board of directors that must deal with such pressure is to remain focused on the qualities that any good CEO must possess regardless of his or her background, namely leadership, management, technology knowhow, and marketing knowhow.

I cited the example of Ken Olsen, the founding president of Digital Equipment Corporation, who came under severe criticism from Wall Street for turning in a bad quarter shortly after the company went public, despite the fact that he had built a company with sales of over $100 million in less than a decade. (That was the equivalent of over $1 billion today.)

Ken decided to go to New York and address his critics directly. He started with a lecture that went something like this:

“I understand that some of you want me fired because I am no good with the numbers. Well, I want you to know that when the company was very small, I was both the purchasing manager who bought the components that went into our computers and I was the sales manager who set the price of those computers and the modules that went into them. In fact, we sold the modules as a separate product line. I used to buy a component called a pulse transformer for a dollar and have our production people mount it on a printed circuit board and sell it as a module for $10. I soon learned that that nine percent of profit really added up.”

The financial people thought he was a kook and left him alone after that while he went on to build a multi-billion dollar company.

Those of us who knew him personally would confirm that he had the four CEO qualities in spades and if the financial people had listened carefully they would have recognized them as well. As a leader, he demonstrated that he could wear many hats simultaneously and he recognized the value of humour in his communications. As a manager, he demonstrated that he did indeed understand the numbers. As a technical expert, he understood what went into the computers, and as a marketing expert, he knew what the market would bear.

Hopefully, the financial people came away from the meeting knowing that a good high technology CEO is likely to be a very complex person who is capable of delivering more than management knowhow.

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Denzil Doyle’s involvement in Ottawa’s high technology industry goes back to the early 1960s when he established a sales office for Digital Equipment Corporation, a Boston-based firm that had just developed the world’s first minicomputer. The Canadian operation quickly evolved into a multi-faceted subsidiary. When he left the company in 1981, Canadian sales exceeded $160 million and its employment exceeded 1,500. In his next career, Doyle built a consulting and investment company,Doyletech Corporation, that not only helped emerging companies, but built companies of its own. In recognition of his contributions to Canada’s high technology industry, he was awarded an honourary Doctorate of Engineering by Carleton University in 1981 and a membership in the Order of Canada in 1995.

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