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Why did United Technologies’ CEO quit?

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in Career Management,Workplace Communication

Strong leaders set lofty goals. But if those aspirations are too ambitious, they can lose their meaning.

In late 2014, Louis Chenevert abruptly resigned as CEO of United Technologies. For a 57-year-old to quit such an important job—with no explanation—stunned observers.

During his 6 ½ years atop the conglomerate, Chenevert acquired Goodrich for $16.3 billion—the largest deal in aerospace history. Because he orchestrated the move in a recession, the wily CEO got Goodrich at a discount.

Some of his other strategic decisions proved equally successful, making United Technologies one of America’s most profitable conglomerates. With such a great track record, why did he quit?

The company emphasized that it was Chenevert’s decision and that no financial improprieties occurred. But criticism of his tenure has emerged.

Chenevert set wildly optimistic—some say unrealistic—goals for his executives. For instance, he sought to raise revenues for one of his business units from $29 billion to $50 billion over six years. That would translate to an almost-impossible 8% annual growth rate in sales.

The board of directors may have concluded that Chenevert’s goals were not achievable—and induced him to leave. Others felt his hands-off leadership style distanced him from his management team.

Soon after his departure, news surfaced that two weeks before his resignation, Chenevert traveled to Taiwan to inspect the building of his yacht. This may have reinforced his team’s perception that he was detached from daily operations and too focused on his private affairs.

— Adapted from “A most baffling resignation,” Shawn Tully, www.fortune.com. ?

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