now here's a reporter that could loss his job
December 14, 1999
wsj
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Investment Banker Lets
Crisis Bring Him New Life
By HAL LANCASTER
Sometimes it takes a crisis to lead you to your true calling.
For John Wood, 36 years old, it was a fast-sinking investment in Telos Inc., a technology integrator based in Ashburn, Va., that led him from the big city to a small town, from single life to marriage and family, and from a career as an investment banker to one as a corporate executive.
Mr. Wood, now chairman and chief executive officer of Enterworks Inc., an information-technology services company spun off from Telos, offers an object lesson in the learning opportunities inherent in smaller organizations. As an investment banker in New York, he worked for relatively small companies -- Dean Witter, then UBS Securities -- before starting his own boutique investment-banking firm, Beninati & Wood, in 1990. "I did some things in a few years that I wouldn't have been able to do at larger firms where I would have been a small fish in a larger pond," he says. At Telos, he was able to work in every major department before becoming CEO. It was a compact, intense management-training program he couldn't have duplicated at a larger company.
"It beats any education you can get on a theoretical level," he says.
It all began with the second investment made by his fledgling firm. Mr. Wood sank much of his own net worth into the deal, which merged two companies into Telos. But lagging sales crushed the company, which was heavily in debt and carrying a lot of inventory. He recalls vividly the dreaded phone call from the company, suggesting he might have to write off his investment.
MR. WOOD DECIDED instead to go to Virginia, fix the problem, then return to his company and his comfortable New York life. The arrogance of this, for a man with no management training or experience, wasn't lost on him. At first, he concedes, he wasn't particularly popular, especially after firing much of management, laying off a third of the work force and imposing pay cuts of up to 20% on the rest. "I was a guy coming in to make a lot of changes quickly, and I wasn't a very good listener," he says. "I would do instead of think."
"It might have been a function of his Wall Street background," says Bob Lewis, a 12-year veteran of the company and now president of Enterworks. "His approach when he got here was shoot first, then adjust and shoot again," he says.
But Mr. Lewis says there was something engaging about this high-energy young man. He decided to stay on despite a 20% cut in pay. "It was almost better that he didn't have the traditional background we came from," Mr. Lewis says. "That wasn't where we needed to go."
The company was in such chaos, there wasn't much choice. "We had five CEOs in five years before him, and they all flunked," says Bob Marino, Telos's executive vice president.
Hal Lancaster answers readers' questions on career issues in Career Corner. Send your questions or comments by e-mail to Hal.Lancaster@wsj.com
For Mr. Wood, used to analyzing companies objectively from the outside, the experience of being on the inside was irresistible. "Looking from the outside in, you see only what a company wants you to see," he says. "You're not in the kitchen of the restaurant -- you're in the dining room." He says financing deals always had an end. But when you're running a company, it's always a journey -- getting to be a market leader, going public, making an acquisition."
Mr. Wood also liked Ashburn, near the Blue Ridge Mountains on one side and Washington, D.C., on the other. He married a local woman and bought a farm.
In his first two years at Telos, Mr. Wood immersed himself in sales, manufacturing, marketing, engineering and finance in an effort to learn the business and keep the company out of bankruptcy proceedings. He worked a lot of 100-hour weeks, earning him the respect of the work force, his management peers and the company's bankers, he believes. "We had a joke," he says. "We work from 9 to 5 -- 9 a.m. to 5 a.m."
He spun off Enterworks in 1996 after deciding the company needed to diversify into niche businesses it could dominate. He remains the nominal CEO of Telos while delegating daily responsibility to a partner.
PROOF OF HIS acceptance here, he feels, came after management and employees, backed by some institutional investors, won the company in a 1993 proxy fight. The investors asked why he thought he should be CEO and he told them to survey the work force. They did, and he got the job.
Since then, he has developed a number of business niches. He also has developed his own management philosophy.
Business success, he contends, requires efficient sharing of information, so he encourages what he calls an internal free-market system. Anyone can get a hearing on a new idea without plowing through a bureaucracy. "The enemy in business is time," he explains. "In a hierarchy, you lose time."
He also believes that to earn the trust and respect of the work force, rules must apply to everybody. When Mr. Marino parked his new dream car, a Jaguar convertible, in front of his office window, he had to hustle out on a bad knee to move it before the tow truck arrived. He had parked in the visitor's lot, Mr. Wood says. Nonvisitors get towed.
Over the years, he says, he has become more willing to listen to others and delegate. "I'm not a soft person," he says, "but I listen a lot more and apologize when I'm wrong. I realize I can get a heck of a lot more from the combined brains of the organization than from my own head."
"Looking back at it now, with what I know, I would never have done it," he says. "I didn't know what I was doing, what kind of impact I could have been having on the company." But in retrospect, he says, "it was a killer education." |
