Who wouldn’t covet such a job? Even the outgoing CEO gushed as he announced his resignation, “Now that the company’s on a sure footing, it’s time for me to move forward with my plans…It’s time to give somebody else a chance and a crack at this fabulous enterprise.”
OK, if being CEO of The Hartford is such a fabulous job, then how come there isn’t a line around the block at One Hartford Plaza?
I think I can answer that question. There’s a lot going on behind those venerable doors that even the management of Hartford can’t understand or control. And since the potential candidates who are actually qualified to do the job know that, they welcome the opportunity to say, “No thanks.” As a result, Hartford will most likely end up with a tail-end custodian CEO who is there to keep the Hartford ship afloat as long as possible, while other alternatives are explored.
According to John Carney who writes for The Business Insider.com, Hartford reportedly approached Christopher “Kip” Condron and Bob Kelly and both declined the top job. Christopher M. “Kip” Condron is president the CEO of AXA Financial, Inc. and a member of the AXA Group Management Board. Robert (Bob) Kelly is chairman and CEO of The Bank of New York Mellon Corporation.
And who can blame them? If I were to grade the challenge facing Hartford’s new CEO, I would use the same “degree of difficulty” scale as an Olympic diving competition. In this case, accepting leadership of the Hartford would be akin to a forward 4-1/2 somersault with, say, 3 or more twists from a 1-meter springboard. (What makes it even worse is that the water is rapidly draining out of the pool.) Which is to say, the job is so impossibly challenging that few savvy execs, it seems, are willing to dive in.
Small wonder, then, that Carney’s article goes on to state that Hartford has spoken to Morgan Stanley co-president James Gorman and former Merrill Lynch executive Bob McCann. Both, according to Carney, have reportedly declined.
So what’s wrong with the Hartford job? Nothing. That is, nothing I haven’t written about before. But for starters:
- The company is mired in a bureaucratic culture that has concentrated on cost-cutting, restructuring and organizing.
- At the same time Hartford has failed to expand into lucrative markets in Japan and Europe.
- To help stabilize its sinking fortunes, Hartford accepted a $2.5 billion investment from Allianz SE.
- Still trapped for cash and unable to peddle company subsidiaries and divisions, it has accepted $3.4 billion in TARP funds, and the draconian government straightjacket that goes with this “investment.”
- The company has completely failed in its bedrock job of prudently pricing its life products and assessing its risk.
- Six top executives have left the company since 2007, with heavier turnovers at lower management levels.
- Finally, here’s a company whose stock was selling for $100 a share little more than a year ago. Now you can buy a share of Hartford for the same price as a couple of Big Macs© (but the Cokes and fries will cost you extra).
All of this is not to mention the fact that big, bad Allianz SE has its nose in the door and just might be the catalyst for the eventual sale or break up of Hartford. And what really qualified candidate will want to walk into that nightmare?
Did I say “degree of difficulty” rating? Perhaps the Richter Scale is a more apt matrix to rate this job. And in this case, the corner office of The Hartford is likely situated on a little-known Connecticut fault line with a magnitude 6.5 trembler varifiably predicted for this year and next. The only thing the new CEO can bank on is that when it hits, Connecticut (and Hartford) are unlikely to fall into the Atlantic Ocean. But if things continue as they are, Hartford may crumble anyway.