Why Sprint Can't Fire Gary Forsee: A Known Bad Is Better Than An Unknown Worse

For Sprint, life with Gary might be bad, but who knows how much worse it could be without him? That’s the rationale keeping the shareholders from replacing the CEO, asserts an internal Sprint source.

Really? Is this the same man whom one year ago Business Week magazine hailed as one of the “Best Managers of 2004“? Says our tipster, name withheld to protect his job security,

Everyone who was in a position to get him removed has retired, resigned, or been terminated… There is no one in the company shareholders would trust to replace him.

Read the final installment of our interview with a Sprint mole, inside…

philip: The last couple of months our COO was fired, our Vice President of Customer Service resigned on two days notice, and our Chariman stepped down. Gary Forsee, our CEO, temporarily ran all of these positions at once.
benpopken: eeks
philip: Yeah VP Customer Service was the first to accept a Severance Package (a golden parachute I’m sure) when Gary Forsee announced 5,000 layoffs on January 7th. It was a bad, bad day.
philip: Everyone who was in a position to get him removed has retired, resigned, or been terminated.
philip: There is no one in the company shareholders would trust to replace him. He has ensured himself [a bulletproof] position. He is Chariman, CEO, and President.
philip: We just got a COO last week after almost three months without one… And nobody in executive leadership is experienced enough to lead a $40B corporation with 52 million subscribers. So even though company performance is outrageously disappointing, shareholders are fearful of how much worse it could be.
philip: Objectives for 2007 posted a couple of weeks ago and I have never seen metric demands that are so outrageous. A lot of good people will lose their job and I imagine a lot of good customers will string together tin cans and string. I’m not sure that Sprint is the worst because all things considered I have mixed feelings on if, as a consumer, I hate Sprint or Cingular more… But we are certainly not headed in the right direction and we show no hope of improving in the near future.
benpopken: sounds like you need a new leader
benpopken: but the shareholders are too pussy
philip: Exactly
philip: And the truly worthy talent within our corporation are all being walked out the door for not meeting goals. Or they’re opening company policy up for cute 20s-something pro-consumerists bloggers to tear apart for everyone to read.
benpopken: ha!

— BEN POPKEN

Previous leaks from our Sprint moles.

Comments

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  1. crayonshinobi says:

    Allow me to conspiracy theorize here a bit(completely my theory and nothing more, feel free to point me out as wrong).

    In the last few decades the largest group of shareholders are usually mutual funds and investment groups, not individuals. So it’s feasible that there is all kinds of collusion going on between the shareholders and the CEOs and chairmen of large companies.

    Or they’re opening company policy up for cute 20s-something pro-consumerists bloggers to tear apart for everyone to read.

    I’m going to pretend your awesome spy is actually named Phyllis or something now.

  2. timmus says:

    Bestowing a “Best Manager Award” to someone who raked in $28.6 million in salary, stock options, and bonuses in 2005 completely undermines whatever credibility Business Week magazine has.

  3. B Borrman says:

    Your mole, while providing valuable insight on many topics, has a poor grasp of corporate governance.

    The executives below the CEO have no say over whether or not he gets to keep his job — that’s the exclusive realm of the board of directors.

    If the shareholders were truly unhappy with his performances they could build a groundswell and force the board to remove him — as they did at Home Depot.

    I don’t know enough about the voting timetables for Sprint’s board, but unhappy shareholders have toppled other CEOs. Sprint’s customers might be furious but their shareholders don’t seem to be at the tipping point yet.

  4. magic8ball says:

    @ crayonshinobi: you’ve neglected the possibilities that “Phillip” could be homosexual, bisexual, or using the word “cute” pejoratively. :)

  5. adamondi says:

    Also, it is not like all CEOs come from within a company. Look at Ford. The board of directors there went to Alan Mulally from Boeing and asked him to be the new CEO. Someone that not only is from outside the company, but is from outside the industry of automobile manufacturing.

    If the board gets sick of Forsee, or if the shareholders get sick of him, then he is toast, whether there are people already within Sprint primed to take his place or not.

  6. homerjay says:

    “a known bad is better than an unknown worse?”
    Do you mean “The devil you know is better than the devil you don’t know?”

  7. emax4 says:

    I wouldn’t be surprised if an ex-employee “terminated” him, if you get my drift. Obviously this person is now someone on the outside who has had enough and represents the people that work / have worked for him.

  8. NeoteriX says:

    @B Borrman:

    You’re missing the point–while the people below cannot remove the CEO, they are in optimal positions to replace the CEO if the shareholders elect to do so. With no experienced talent to groom for a promotion to CEO, the shareholders’ options appear to be limited.

    @adamondi:

    While true, any company looking to steal an exec with a good rep. from another company at the nadir of his performance will do so at a premium price.

  9. B Borrman says:

    @Neoterix:

    I know this will probably never be seen now, but I am not missing the point. More frequently than not , the top spot in a company is filled by someone poached from the outside. Especially in an industry as volatile as telecom.

    The experience of those beneath the CEO is often not relevant when it comes to finding a replacement. And if there is a delay in finding a new head, there are a ready number of board members and “retired” former executives ready to take a temporary spot.