The Nour Group, Inc.
January 2007 – Relationship Economics® Newsletter

Dear Clients, Colleagues and Friends:

What a beginning to the new year here in Atlanta – Bob Nardelli ousted as CEO of Home Depot.  Garry Betty, CEO of EarthLink, died of cancer complications.  Jim Mora fired as the Atlanta Falcons’ Head Coach.  As I look for lessons from each, here is one perspective:

• Nardelli was an example of a bad executive hire.  His performance simply didn’t match his compensation package – something many believe he thought of as a scorecard.  Shutting down shareholders at last year’s meeting was a clear illustration of an arrogant, overpaid CEO.  Arthur Blank was asked at a function I attended late last year, what he thought of Nardelli’s centralizing functions and tight ship tactics vs. giving store managers more say in serving their local markets and training their employees.  He didn’t have a kind response.  Although you can’t argue with profits and revenue soaring under Nardelli’s six-year tenure, many saw customer service as a sore spot. Some Home Depot stores look tired and disorganized, and finding an employee to help locate items can be a chore at times.  The Board finally had enough and found a way to part ways – unfortunately at the cost of $210M severance package to the shareholders.
• Betty is an example of an aspiring flame going out before its time.  He was a local hero, graduating from Georgia Tech, gaining solid experiences at IBM and turning a modem into a commodity at Hayes Microcomputer Products, before becoming President & CEO of Digital Communications Associations (DCA) – the youngest CEO of an NYSE listed company.  He served as president and CEO of EarthLink from 1996 to 2007, transforming EarthLink from a small regional ISP with fewer than 100,000 members to a national brand with more than five million subscribers.   In the process, he led most of EarthLink’s major milestone achievements, from an IPO to a strategic alliance with Sprint, to eventually merging the company with long-term competitor MindSpring. During the past several years, he earned several well-deserved honors, including the Georgia Technology Hall of Fame, Ernst and Young Entrepreneur of the Year, and one of the Most Influential Atlantans by the Atlanta Business Chronicle.  His leadership will certainly be missed.
• Mora is an example of the need for Introspective Leadership.  Although he went 12- 4 in his first year, over the next two seasons he lost games, respect by some of his players and confidence by the fans and the owner.  Unfortunately, he was known as much for what he didn’t get done on the field as for the comments and incidences off the field.  I’m writing a book on the need for all of us forty-somethings to look deep within and ask ourselves if we are really ready to lead if we’ve never been tested.  Whether it’s learning how to win big games on the football field or in the day-to-day governance of our respective businesses, I’m not convinced Mora was ready for prime time; I’m not convinced the bench in corporate America is as deep as we hope and need it to be either!
  

A sample New Year’s resolution, an assessment of the value of holiday cards, an overview of VTPs – Very Talent People, and a timely article entitled “Just Because You Call It Strategic, Doesn’t Make It So” are among some of what we’ve gathered both within and external to our firm.  We hope you’ll enjoy this month’s Relationship Economics® newsletter and will forward it to colleagues you deem of value.

Happy New Year!
David

David Nour, Managing Partner
The Nour Group, Inc. – Atlanta
404-419-2115 x9101