Picking a director as CEO is in United’s DNA
When United Continental turned to a board member last fall to replace its former CE who resigned under a cloud, the airline was following a playbook it has used not altogether successfully twice before. In the late 1980s, United had become a travel conglomerate that owned hotels and a rental-car company under then-chairman Richard Ferris. After an early version of activist investors, Coniston Partners, pressed for the empire to be dismantled, Ferris resigned in 1987 and the United board tapped then-director Frank Olson, CEO of Hertz Corp., to succeed Ferris as chairman and CEO. Only months later did United conclude an executive search and name airline industry executive Stephen Wolf to take over. Wolf, responding to pilot pressure, sold the airline to a majority of the workers in 1994 and left the company. He was succeeded by a union-backed auto-industry executive, who lasted five years. In 1999, the company then turned to a 32-year United veteran, Jim Goodwin. Shortly after the 9/11 terrorist attacks, Goodwin fell afoul of the company’s unions after telling employees that the company would “perish” if it didn’t get its costs under control. Again, United’s board turned to a director. It selected Jack Creighton, a retired paper-company CEO, as chairman and CEO on an interim basis. Creighton said at the time that he “didn’t take this job to preside over a bankruptcy.” He was succeeded nearly a year later by an outside candidate produced by an executive search, Glenn Tilton. Tilton, who came from the oil industry, quickly put United into bankruptcy-court protection. After the three-year reorganisation, he brought the airline out of Chapter 11 in better shape and began searching for a merger partner. That hunt culminated in United’s 2010 marriage to Continental Airlines. The combined company took on Jeff Smisek, the former Continental chief, as CEO. After a federal investigation into airport operations in New York and New Jersey cast a harsh light on Mr. Smisek, he was abruptly ousted last September. United director Oscar Munoz, a railroad executive, got the job.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2016-04-11/star/picking-a-director-as-ceo-is-in-united2019s-dna
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Picking a director as CEO is in United’s DNA
When United Continental turned to a board member last fall to replace its former CE who resigned under a cloud, the airline was following a playbook it has used not altogether successfully twice before. In the late 1980s, United had become a travel conglomerate that owned hotels and a rental-car company under then-chairman Richard Ferris. After an early version of activist investors, Coniston Partners, pressed for the empire to be dismantled, Ferris resigned in 1987 and the United board tapped then-director Frank Olson, CEO of Hertz Corp., to succeed Ferris as chairman and CEO. Only months later did United conclude an executive search and name airline industry executive Stephen Wolf to take over. Wolf, responding to pilot pressure, sold the airline to a majority of the workers in 1994 and left the company. He was succeeded by a union-backed auto-industry executive, who lasted five years. In 1999, the company then turned to a 32-year United veteran, Jim Goodwin. Shortly after the 9/11 terrorist attacks, Goodwin fell afoul of the company’s unions after telling employees that the company would “perish” if it didn’t get its costs under control. Again, United’s board turned to a director. It selected Jack Creighton, a retired paper-company CEO, as chairman and CEO on an interim basis. Creighton said at the time that he “didn’t take this job to preside over a bankruptcy.” He was succeeded nearly a year later by an outside candidate produced by an executive search, Glenn Tilton. Tilton, who came from the oil industry, quickly put United into bankruptcy-court protection. After the three-year reorganisation, he brought the airline out of Chapter 11 in better shape and began searching for a merger partner. That hunt culminated in United’s 2010 marriage to Continental Airlines. The combined company took on Jeff Smisek, the former Continental chief, as CEO. After a federal investigation into airport operations in New York and New Jersey cast a harsh light on Mr. Smisek, he was abruptly ousted last September. United director Oscar Munoz, a railroad executive, got the job.<br/>
