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4 More Tech CEOs That Should Get the Axe

Yahoo drew first blood with Bartz - here's who's next

   

Cisco CEO John ChambersWhen Carol Bartz came on board Yahoo (NASDAQ:YHOO) a few years ago, she was supposed to bring discipline to the company and craft a sustainable growth strategy. Well, it turned out to be a disaster, and as of Wednesday, Bartz is out of a job. Interestingly enough, the shares of Yahoo spiked 5% on the news.

Now the buzz is that Yahoo will ultimately be sold off.

No doubt, Bartz’s failure is far from the exception in the tech industry. If anything, there are many examples of CEOs that should get the boot.

Who are some of the notable ones? Let’s take a look:

Cisco

CiscoCisco (NASDAQ:CSCO) has been a perennial laggard for shareholders. The 10-year-return on CSCO stock is a dismal 12% and underperforms the broader market.

The company’s CEO, John Chambers (pictured above), has been at the helm since 1995. And from the start, he was aggressive with acquisitions. It was a smart way to maintain an innovation edge — as well as leverage Cisco’s huge distribution footprint.

The problem is the company has many disparate businesses, with little cohesion. More troubling, Cisco also is having issues with its router business, which is a critical source of cash flows. Low-cost Chinese rivals are also making a dent in Cisco’s business.

Dell

dell computer logoDell (NASDAQ:DELL) is really a tale of two CEOs. From 1984 to 2004, Michael Dell was a visionary. He created a build-to-order platform that allowed for lots of growth and cash flows.

But since Michael returned in 2007, things have been terrible. The company has paid steep prices for software and storage companies. At the same time, it has missed some of the latest trends in tech, especially the surge in tablets.

With about two-thirds of revenues coming from the PC business, it is difficult to see how Dell will get much traction. It needs new blood in the corner office to find a new way forward.

Research In Motion

Research in Motion LogoWith Research In Motion (NASDAQ:RIMM), you have a two-fer. That is, RIMM has co-CEOs: Michael Lazaridis and James Balsillie.

It’s been double trouble at RIMM lately. So far this year, the company’s shares are off 45%. In fact, the price-to-earnings ratio is only 5.

Then again, the onslaught of Apple (NASDAQ:AAPL) is likely to continue to tear into RIMM’s business. At the same time, there will be tremendous pressure from Android operators.

So getting rid of the co-CEOs probably is a good idea just to clean house and start fresh. But even with this, it is hard to figure out a strategy that can work. Hey, just look at Nokia (NYSE:NOK). Bringing on a new CEO has made little difference in this company’s fortunes.

AOL

aolIt’s hard to believe AOL (NYSE:AOL) was once a tech darling. But since the dot-com crash, it has been in a grueling death spiral. Has anything really worked for this company?

As InvestorPlace.com’s Jonathan Berr indicated this week, AOL actually is worse than Yahoo. Simply put, the company’s CEO, Tim Armstrong, can’t devise a strategy to boost traffic and revenues. This is the case despite some expensive acquisitions, such as for Huffington Post and TechCrunch. Armstrong also is spending huge sums for its local content service, Patch.

To top it off, Facebook is eating AOL’s lunch. Not good for Armstrong’s future prospects.

Tom Taulli is the author of various books, including “All About Commodities.” He does not own a position in any of the stocks named here.


Article printed from InvestorPlace Media, http://investorplace.com/2011/09/4-more-tech-ceos-that-should-get-the-axe/.

©2017 InvestorPlace Media, LLC