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Sun, Feb 04, 2007 - Page 12 News List

Dell Inc hopes for turn-around with return of former CEO

NY TIMES NEWS SERVICE , NEW YORK

But some analysts say that Dell must move much more aggressively to market its wares in the retail market -- a departure from its single-minded reliance on the direct model.

If statistical averages are any guide, Dell's performance may well improve.

Rudi Fahlenbrach, an assistant professor of finance at Ohio State University's business school, found that a company's stock performs 9 percent better than the market after the return of a founder, which has happened with 28 companies since 1993.

But business leadership and management is an individual craft.

Take the case of Corning. Houghton, who is the great-great-grandson of the company's founder, came back when Corning, a supplier of fiber optic cable, was suffering from the post-bubble collapse in telecommunications.

Houghton had returned as non-executive chairman nine months before the board pushed out the CEO and he took over himself.

Corning had always invested in a range of technologies, and one of those long-nurtured investments, in liquid crystal displays, was starting to develop into a promising business.

Today, the flat-screen display technology used in PCs, cellphones and digital televisions has powered the company's comeback.

Houghton's comeback formula, he said, relied on getting the right team and strategy in place and then pushing it -- the same steps mentioned by management experts.

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