Finkelstein the author of "Why Smart Executives Fail" (www.whysmartexecutivesfail.com/) and the sequel, "Think Again," focuses on why good leaders make bad decisions. His list has five worst CEOs along with two CEOs who almost (but didn't) make the list (Facebook's Mark Zuckerberg, and Groupon's Andrew Mason).
Here are Prof. Sydney Finkelstein's pick for the Worst CEOs of 2012:
1. Brian Dunn, former CEO, Best Buy (resigned April 2012)
Stepped down in April after five years of declining stock and loss of market share to Amazon, Wal-Mart, and Apple. Happened to Circuit City, happening again. Showroom to buyers is not a defensible strategy.
Led the company in a strategy of up- and cross-selling instead of improving basic customer service and online offerings.
Allegations of an inappropriate relationship with a 29-year old subordinate later surfaced.
Stock down 50% YTD. Same stores sales down, eps down, sales down, cash down 85%.
Constant use of operation cash to repurchase shares. According to Minyanville, Best Buy has spent $6.4 billion on share buybacks since 2008, which is $360 million higher than where the stock is currently valued. In essence, Dunn and co. completely wasted $6.4 billion in cash that it could direly use right now.
Text: Business Standard