Executive Times

Volume 9, Issue 3

March 2007


 2007 Hopkins and Company, LLC

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Wise executives acknowledge that luck plays a part in success. The proudest leaders will claim they make their own luck, and can control all factors, while more humble leaders recognize that despite competence and preparation, the unexpected happens, sometimes for better and sometimes for worse. We’ve selected a few stories about executives this month, some of whom appear to have been lucky, and others unlucky. As you think about their situations, reflect on how you might have made decisions that led to different outcomes. When you celebrate Saint Patrick’s Day this month, try to capture a bit of the luck of the Irish, but let someone else be the designated driver.


Fifteen new books are rated in this issue, beginning on page 5. Two books are highly recommended with four-star ratings, twelve books are recommended with three-star ratings, and one book is mildly recommended with a two-star rating. Visit our 2007 bookshelf at http://www.hopkinsandcompany.com/2007books.html and see the rating table explained as well as explore links to all 267 books read or those being considered this year, including 44 that were added to the list in February. If there’s something missing from the bookshelf that you think we should be considering or if there’s a book lingering on the Shelf of Possibility that you think we should read and review sooner rather than later, let us know by sending a message to books@hopkinsandcompany.com. You can also check out all the books we’ve ever listed at http://www.hopkinsandcompany.com/All Books.html.



The Saint Valentine’s Day massacre of JetBlue and the pain experienced by its customers started on 2/14 and has not yet ended. The company is “focused on creating a new airline category - an airline that offers value, service and style.” Until weather problems crippled their organization in mid-February, they were making good progress. Founder and CEO David Neeleman announced 2006 results at the end of January saying, “I'm tremendously proud of the efforts our crewmembers have made in advancing our plan to institutionalize low-cost carrier spending habits and improve revenue overall - we've made great progress since the beginning of 2006. We are optimistic about what lies ahead as we seek to further improve our financial and operating performance.” (http://investor.jetblue.com/phoenix.zhtml?c=131045&p=irol-newsArticle&ID=955585&highlight=) Then bad weather struck, and JetBlue stumbled in its actions. Comfy leather seats, satellite TV and radio, and extra legroom were not enough to please those customers who were stuck on a runway for 10 hours, or for those who expected to travel, and found their flights canceled days after the weather cleared. Neeleman became a media celebrity as he apologized to customers at every opportunity. He even had the courage to appear on The David Letterman Show (Letterman kept him waiting.) Competitors who may have felt schadenfreude at JetBlue’s problems found that to be short-lived after some politicians murmured about Congressional action, and after JetBlue issued a passenger bill of rights. (You can read the bill of rights at http://www.jetblue.com/about/ourcompany/promise/index.html.) Competitors are likely to match JetBlue’s customer-friendly approach with their own, or face a legislative or regulatory mandate. In either scenario, costs for airlines will rise because of new promises to compensate customers for delays and other problems. It’s too early to tell whether or not all of Neeleman’s actions will made this a case study in good crisis management. In the short run, the airline that was trying to “bring humanity back to air travel,” and that treated passengers as customers, will pay a heavy price for how they handled their business when bad weather struck. Finally, despite what Neeleman needs to focus on, he does not plan to take medication for his attention deficit disorder, and feels he’s the best person to lead JetBlue out of this mess. Customers, shareholders, competitors and business school case writers will all be watching.


Are your customers and employees aware of what your organization is willing to do in the event that problems arise? Does one of your competitors provide more clarity in this area than your company?


Executives who drive their own cars may not take risks that differ from other drivers, but may face harsher consequences when things go awry. A recent story about another airline CEO proved that point. We read in The Wall Street Journal (2/9) (http://online.wsj.com/article/SB117104030888703816.html) that US Airways chief executive Doug Parker was arrested on a drunken-driving charge just hours after his airline's $9.8 billion bid for Delta Air Lines was rejected. … Mr. Parker, 45 years old, was pulled over at 11:30 p.m. Jan. 31, after leaving a party at the FBR Open golf tournament in Scottsdale, police Sgt. Mark Clark said. Mr. Parker was pulled over for driving 20 mph over the posted speed limit of 45 mph. Results released Friday show Mr. Parker had a blood-alcohol level of 0.096, according to Sgt. Clark. The legal limit in Arizona is 0.08. According to a police report, Mr. Parker told police he had three beers during a two-hour period.” After news reports of the incident began to appear, Parker wrote to US Airways employees, “First and foremost, you need to know how embarrassed and sorry I am about this. I have let down all of you and also my family, and that is something I will have to live with irrespective of the outcome. I know that by virtue of my position at our airline, all of my actions, personal and public, have consequences for all of us and I try very hard to live up to that responsibility. In this instance, my actions have not reflected well on US Airways and for that, I apologize. Thanks for your support and understanding.” (http://www.usairways.com/awa/content/aboutus/pressroom/pressreleases.aspx?c=hp_news). Delta CEO Gerald Grinstein made no public comment, but one might guess that having fought off Parker’s relentless drive to merge with Delta through a hostile offer, Grinstein probably cracked a smile at his adversary’s bad luck in another form of driving.


Have you ever driven 65 mph in a 45 mph zone, or 75 when the posted limit is 55? Have you ever driven a car after consuming several beers in a few hours? Could any of your actions not reflect well on your organization? If you haven’t yet been caught, is it because you’re good or lucky?


Every boss hates surprises. The last thing that President George W. Bush needed to hear at the same time he’s planning to increase the number of soldiers in Iraq was that the wounded soldiers at home are being neglected. A page one of The Washington Post on February 18 told Bush exactly that. (http://www.washingtonpost.com/wp-dyn/content/article/2007/02/17/AR2007021701172.html)  Press secretary Tony Snow said the president told him, “Find out what the problem is and fix it.” One aspect of the story to note here is the key role of the front line manager, and how senior executives can be out of touch. According to the Post, “Soldiers are assigned to one of two companies while they are outpatients -- the Medical Holding Company (Medhold) for active-duty soldiers and the Medical Holdover Company for Reserve and National Guard soldiers. The companies are broken into platoons that are led by platoon sergeants, the Army equivalent of a parent. Under normal circumstances, good sergeants know everything about the soldiers under their charge: vices and talents, moods and bad habits, even family stresses. At Walter Reed, however, outpatients have been drafted to serve as platoon sergeants and have struggled with their responsibilities. Sgt. David Thomas, a 42-year-old amputee with the Tennessee National Guard, said his platoon sergeant couldn't remember his name. ‘We wondered if he had mental problems,’ Thomas said. ‘Sometimes I'd wear my leg, other times I'd take my wheelchair. He would think I was a different person. We thought, “My God, has this man lost it?”’ Civilian care coordinators and case managers are supposed to track injured soldiers and help them with appointments, but government investigators and soldiers complain that they are poorly trained and often do not understand the system.… At town hall meetings, the soldiers of Building 18 keep pushing commanders to improve conditions. But some things have gotten worse. In December, a contracting dispute held up building repairs. ‘I hate it,’ said Romero, who stays in his room all day. ‘There are cockroaches. The elevator doesn't work. The garage door doesn't work. Sometimes there's no heat, no water.... I told my platoon sergeant I want to leave. I told the town hall meeting. I talked to the doctors and medical staff. They just said you kind of got to get used to the outside world . . . my platoon sergeant said, “Suck it up!’’” The buildings are being repaired, according to follow up stories, but the platoon sergeants are the ones who may need repair of another sort.


How often do you observe first hand the conditions faced by those in your organization? How do you assess the ways in which your first line managers implement what you want done? How likely is it that something will surprise you in the next ninety days? What more can you and others do to avoid surprises?



There’s a great cover story about corporate wellness programs in the 2/26 issue of Business Week (http://www.businessweek.com/magazine/content/07_09/b4023001.htm). For one executive, the program was a lifesaver. “In August, Joe Pellegrini got yet another nagging phone call. It was his health coach, a woman working on behalf of his employer, the $2.7 billion lawn-care company, Scotts Miracle-Gro Co. The 48-year-old executive knew the spiel by heart. ‘Have you been to your doctor yet? When are you going?’ Then the prescription: ‘You need to lose weight and you really, really need to lower your cholesterol.’ Pellegrini is a supply-chain executive at Scotts' headquarters in Marysville, Ohio, a land of all-you-can-eat buffets smack in the middle of America's obesity belt. At Scotts the hallways are filled with ldl-abusers and overweight diabetics. Pellegrini, by contrast, is an Armani-swaddled triathlete who often cycles 36 miles to and from work. Lose weight? ‘Give me a break,’ he thought. ‘It's all muscle, folks.’ But a time bomb was ticking beneath the taut physique. Medical specialists working on behalf of Scotts had been scouring every aspect of Pellegrini's health. His profile—athletic, high body-mass index, and bad cholesterol (brought on by a love of 28-ounce sirloins)—triggered an alarm. Eventually, Pellegrini succumbed to the company-applied pressure and agreed to abide by his health coach's action plan, which included an immediate visit to his doctor. A few weeks later, a specialist studying Pellegrini's angiogram spotted the heart valve of what should have been a dead man. Within hours, two stents were installed. The surgeons later told him the 95% blockage would have killed him within five days. ‘It was that close,’ Pellegrini says.” Was Pellegrini the beneficiary of good luck, or just-in-time action? Read the rest of the article to learn about some of the downsides of wellness programs.


When was your last medical check-up? Do you rely on luck to stay healthy? Have you been charmed with great genes? Are you as healthy as you appear? What are you doing to avoid nasty health surprises? Do you need to be nagged?



Here’s an update on stories covered in prior issues of Executive Times:

Ø      We last checked in on DaimlerChrysler in the February 2005 issue of Executive Times when we wondered about how much longer former CEO Jürgen E. Schrempp would lead the company. His successor, Dr. Dieter Zetsche announced on 2/14: “The Chrysler Team worked out a comprehensive Recovery and Transformation Plan using all resources within DaimlerChrysler. In addition to that and in order to optimize and accelerate the presented plan we are looking into further strategic options with partners beyond the business cooperation partners mentioned. In this regard, we do not exclude any option in order to find the best solution for both the Chrysler Group and DaimlerChrysler.” (http://www.daimlerchrysler.com/dccom/0-5-7164-1-717363-1-0-0-0-0-0-12037-7164-0-0-0-0-0-0-0.html). The “for sale” sign has been hung in the side window, and now we’ll be watching to see if there are any takers.

Ø      We thought that State Farm resolved the Hurricane Katrina claims in Mississippi when we noted the company’s agreement to a proposed settlement in February 2007 issue of Executive Times. The judge said not so fast, the settlement might not be adequate. State Farm announced on 2/14 that it had enough: “Citing uncertainties in the Mississippi legal and business environments, State Farm Senior Vice President Bob Trippel yesterday advised Mississippi’s Commissioner of Insurance George Dale that State Farm Fire and Casualty Company will suspend writing new homeowners and commercial property insurance in the state of Mississippi. ‘We came to this decision reluctantly.  But it is no longer prudent for us to take on additional risk in a legal and business environment that is becoming more unpredictable.  When there’s more certainty, we will reassess the situation,’ said Trippel.” The next day Mississippi Attorney General Jim Hood proposed legislation to require State Farm to continue writing new homeowners and commercial property insurance in the state.  State Farm responded by calling Hood’s proposal a disappointing response to what was a difficult business decision, adding that it underscores the legal and political challenges faced in Mississippi. The company’s market share in Mississippi has been about 30%.



Executive transitions are often messy, and when it comes to family transitions, they can become Shakespearean tragedies or spin out of control like soap operas. Some executives won’t let go of control, and some family heirs are ill-prepared to manage effectively. We thought of two successful transitions in the same family recently when we heard that Charles R. Walgreen, Jr. died in early February at age 100. His father founded a neighborhood pharmacy on Chicago’s South Side in 1901, and Jr. grew up in the business, which had 20 stores by 1919. Charles R. Walgreen, Sr. prepared his son, Chuck, to lead what was by 1927 a publicly traded company and called him “a good negotiator with a million-dollar smile.” When Sr. died in 1939, Chuck became President, and grew sales exponentially, introducing the concept of self service and revolutionizing the pharmacy business. He prepared his son, Charles R. “Cork” Walgreen III, to lead the company as well, and in 1976 when Chuck retired to focus on sailing all over the world, another successful transition was achieved when Cork took over company leadership. Chuck Walgreen was 95 when he had his last yacht built, and he spent his retirement years sailing as far away as Antarctica to see the 1,000 mile shoreline that family friend Richard Byrd named the Walgreen Coast in honor of his father. Chuck died at the family home outside Chicago, in the knowledge that the company has been in good hands.


Latest Books Read and Reviewed:

 (Note: readers of the web version of Executive Times can click on the book covers to order copies directly from amazon.com.  When you order through these links, Hopkins & Company receives a small payment from amazon.com.  Click on the title to read the review or visit our 2007 bookshelf at http://www.hopkinsandcompany.com/2007books.html).


Title (Link to Review)



Review Summary


Man in the Middle

Haig, Brian


Retaliation. Sean Drummond returns, now working temporarily for the CIA, and embroiled in a thrilling case of revenge.

Made to Stick: Why Some Ideas Survive and Others Die

Heath, Chip and Dan Heath


Success. Great presentation of why some ideas are conveyed and remembered while others are forgotten.

American Fascists: The Rise of the Christian Right

Hedges, Chris


Intolerance. Hedges proposes that we must no longer tolerate the intolerance of our fellow citizens. He deliberately infuriates potential readers with his rhetoric, thereby testing his premise.

Lisey’s Story

King, Stephen


Grief. A widow’s story of her long marriage to a writer, and the power of their love. Atypical King, which may displease some fans but will surprise readers who have pigeonholed King.

I’m Proud of You

Madigan, Tim


Friendship. Eavesdrop on the friendship that grew between the author and the late Fred Rogers. As a bonus, read the letters that Fred sent to Tim that display goodness and friendship.

You Suck: A Love Story

Moore, Christopher


Adolescent. Entertaining novel of vampire love and the quest to quench appetite. The humor is adolescent, escapist and funny, providing an ideal distraction.

Rumpole and the Reign of Terror

Mortimer, John


Ties. The Timsons, Rumpole and the British Anti-Terror Act are linked together in this timely novel, packed with the usual Rumpole vivacity.

Mind Set!

Naisbitt, John


Surprises. Interspersed among the pages of things already known are one or more surprises for readers that may have a profound impact. Read and be surprised by that discovery.

The New American Workplace

O’Toole, James


Data. Authors update landmark 1972 study of work in America with current data and fact-based conclusions delivered clearly in an organized and systematic way.

The Blade Itself

Sakey, Marcus


Consequences. A promising debut novel with a suspenseful plot, interesting characters and an exploration of the consequences that follow choices.

Andy Grove

Tedlow, Richard


Unrelenting. A well-written biography of Intel and its successful former CEO Andy Grove by Harvard professor and historian.

About Alice

Trillin, Calvin


Love. A finely written and heart warming book that allows readers to glimpse into the loving relationship between the author and his late wife, who was and is his muse.

Point to Point Navigation

Vidal, Gore


Quirky. Second memoir flows in erratic ways, full of riffs, mostly trenchant observations about others and confirmation of his own genius.

From Day One

White, William J.


Mentor. A great book of practical advice, especially to new workers. A mentoring experience in print.

State of Denial

Woodward, Bob


Indictment. Book 3 of the Bush at War series indicts the President and the administration for creating an alternative reality and denying whatever doesn’t fit their made-up view of the situation in Iraq.


2007 Hopkins and Company, LLC.  Executive Times is published monthly by Hopkins and Company, LLC at the company’s office at 723 North Kenilworth Avenue, Oak Park, Illinois 60302. Subscription rate for first class mail delivery of the print version is $60.00 per year (12 issues). Web version subscriptions are $30.00 per year. Single issues: $10.00 print; $5.00 web. To subscribe, sign up at www.hopkinsandcompany.com/subscribe.html, send an e-mail to executivetimes@hopkinsandcompany.com, call (708) 466-4650, or fax to (708) 386-8687. For permission to photocopy or e-mail Executive Times, call (708) 466-4650 or e-mail to reprints@hopkinsandcompany.com. We will send sample copies if requested. The company’s website at http://www.hopkinsandcompany.com/archives.html contains the archives of back issues beginning in the month after the issue date. 

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