Reprint: R0605A
Jack Donally was a colossal figure who commanded a lot of respect, if not affection. Just before Jack suddenly died, the board appointed Stephanie Fortas as the new CEO to lead Innostat, the world’s best-known manufacturer of prosthetic limbs and surgical implants.
Innostat has recently been struggling; its once generous margins have been narrowing for the past several years as other companies have found ways to engineer around its patents and develop competitive products of their own. Worse, the company seems to have lost its innovative edge: It has not launched a major new product in four years. The previous year, the board rejected a plan for a large-scale reorganization that might have addressed many of these fundamental problems. Should Stephanie revive the plan?
Her coach tells her she doesn’t have the clout to survive a reorg and advises her to scope out new products and drive them through the way Jack used to. Meanwhile, Stephanie deliberates about whether or not to fire Frank Timoshotsky, the self-effacing head of production who had been Jack’s protégé and who was passed over for the CEO position.
Commenting on this fictional case study are Robert A. Eckert, the chairman and CEO of Mattel in El Segundo, California; Steven F. Dichter, the director of TruePoint Partners in Waltham, Massachusetts; Patrick J. Canavan, a senior vice president and the director of global governance at Motorola in Schaumburg, Illinois; and Kerry Sulkowicz, a psychiatrist and psychoanalyst who founded the New York–based Boswell Group.
