ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, April 5, 1996 TAG: 9604050091
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
DATELINE: NEW YORK
SOURCE: Associated Press
THE BALKAN PLANE CRASH that killed Secretary of Commerce Ron Brown also claimed executives of 12 different companies. Each business will have difficulties specific to its own operations.
Robert Donovan had a tough job ahead of him in 1994 when he was named president of ABB Inc.: Mold a huge engineering company created by acquisitions into a single, seamless organization.
Donovan was enthusiastic. Just one month ago, he summoned 150 top managers working in North and South America to a meeting in Miami to talk about construction projects in various parts of the world. They left with a renewed determination to work together - as a team.
``That's something that was fairly new to our lives,'' recounted Susan Borches, a spokeswoman for the Norwalk, Conn., company.
Looking back on that success, however, is bittersweet for Borches. Donovan was one of the executives on Commerce Secretary Ron Brown's flight in the Balkans that crashed Wednesday and killed all those aboard.
For ABB, the loss no doubt means efforts to further meld ABB's 22,000 workers into one cohesive unit will be delayed. Of the other 11 companies with executives on the flight, each will have difficulties specific to its own operations.
The deaths, certainly difficult for the leaders' families and friends, also represent a devastating blow to their businesses. The severity depends on several factors, including the talent of existing managers.
``The companies that are tremendously pained by this are those that are losing a visionary leader, those that are undergoing change right now where the CEO is spearheading the effort,'' said David Rhodes, a principal at the management consulting firm Towers Perrin.
Corporate leaders caught in the crash come from companies of all sizes in disparate industries, though all related to the rebuilding efforts Brown was working to promote. For example, John Scoville, chairman of Chicago's Harza Engineering Co., came from a relatively small company.
Harza, which in 1992 helped fortify 47 miles of underground Chicago tunnel after a flood-causing accident, employs just 700 and has annual sales of about $110 million compared with $5.2 billion at Donovan's ABB. Scoville was known for digging into projects as an engineer as well as manager.
He also brought in work, most notably from overseas.
``His relationships in many foreign countries were invaluable to us,'' said James Lindell, a member at Harza's board of directors. ``Although we have other people with relationships, his were very strong. We're certainly going to miss that.''
Top executives, especially at smaller companies, tend to develop personal relationships with clients - relationships that may not easily pass from manager to manager. Their loss could cost business, perhaps a lot.
On the personal side, CEOs at their best also develop relationships with employees, which can lead to important support for their strategies. The death of a popular leader can have serious long-term consequences for a company, making the choice of a successor critical.
``A wrong choice could mean that the strategy doesn't get implemented,'' consultant Rhodes said. ``A wrong choice could mean that as an employee I don't feel secure, and I ought to update my resume.''
Some of the companies that lost leaders in the crash have named interim CEOs, filling the leadership vacuum while giving themselves time to consider permanent candidates, both internally and outside the company.
Others have said their second-in-commands will take charge until further plans can be made.
At Parsons Corp., an engineering company whose chairman and chief executive, Leonard Pieroni, was on the flight, has announced that company president Thomas Langford will run the Pasadena, Calif., firm until the succession issue is worked out.
Langford will have a tough act to follow. Pieroni was a popular leader among Parsons' 10,000 employees.
``He has impressed his personality on that company and that will be missed,'' said Joseph Jacobs, chairman of Jacobs Engineering Group Inc. in Pasadena and a friend of Pieroni.
Strong leaders like Pieroni are not easily replaced, but most sizable companies are prepared for the unexpected. Over the past 10 years, companies have begun to take more seriously the preparation of succession plans.
If they haven't, they may begin to look at it anew.
``This makes everybody refocus,'' said Ed Orchant, president of A-L Associates Inc., an executive search firm. ``This type of very big news story gets corporations thinking, `What if it was our guy?'''
LENGTH: Medium: 87 lines KEYWORDS: FATALITYby CNB