Wednesday, October 15, 2014

Admiring Meg Whitman (Then) as eBay CEO

Meg Whitman as eBay CEO (1998-2007)

I kept a journal on leadership, business and economics, and on September 1st 2003 I wrote the following notes, after reading Meg And The Machine: Unstoppable eBay is No. 8 among FORTUNE's Fastest-Growing Companies:

eBay’s phenomenal success is not necessarily the top takeaway for me. Rather, it is its missteps and subsequently its deft recovery from these.

For example, Whitman pulled eBay out of Japan - even though it is the second largest economy and a country of heavy internet users - because she figured (a) Yahoo! already had an insurmountable lead and (b) eBay would be hit offline. To wit, in 1999, she acquired Butterfield & Butterfield, a traditional auction house in San Francisco: She apparently couldn’t pull the acquisition off, and quietly sold it in 2002 for “immaterial gain.”

Apparently her costliest mistake, however, was rolling out a checkout procedure, Billpoint, that was geared to make it fast and easy for buyers and sellers to settle bills. One-third of the sellers hated it because they felt eBay was subverting their choice: They had grown fond of PayPal. To eBay’s credit, it acted quickly and re-established payment choices for the community.  In 2002 eBay bought PayPal for $1.5 billion, hundreds of millions more than it would have paid a year earlier. So, she missed the boat twice, but recovered effectively.

By the way, Elon Musk co-founded PayPal, and as the largest shareholder he came away with $165 million from that sale. 

A few key points in the Fortune article:

The international language of eBay managers: statistics. 

If it moves, measure it… In other words, eBay is a fire hose of business data.
Our destiny is completely in our hands… There are lots of dials we can turn.
Whitman is a soft-spoken, very humble leader, whose personality apparently pervades the culture: COO Maynard Webb says, “A monkey could drive this train.”
This company truly is built by the community of users.
She talks about building a global enterprise.
Understanding management-consultant culture is key to understanding Whitman’s style.
Late June, Whitman strides to center stage at a crowd of 10,000 customers in Orlando, FL, smiling, giggling nervously, then quieting the masses: 
We don’t always get it right the first time, but we try our best to get it right. We succeed when you succeed.
She has perfected a common touch.

She considers herself a “Level 5 manager” à la Jim Collins: exceedingly humble, focused on people first, takes the blame for problems but credits the team for successes.

A few days later, on September 12th 2003, I noted the following:

I resonate with Meg Whitman’s understated nature. Her nervous giggle is something similar to what I have gotten feedback on at the office. While I saw the value of managing my own nervous laughter, I know that it is a reflection of my humanity and personability.

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