Leadership Change: A Business Case Study of Time Warner

At the conclusion of its Monday November 5, 2007, meeting, Time Warner's board of directors announced that Jeffrey Bewkes would succeed Dick Parsons as CEO of the cable and media company.

Whereas many company's struggle with leadership change at the CEO position, Time Warner opened a new paradigm based on the leadership of Dick Parsons who will remain Chairman of the Board of Directors at Time Warner as his humility and strategic leadership began this process over eighteen months ago when he went to the board to discuss the future of the company and the need for it to begin the process of leadership succession while he was still in the top position, avoiding the proverbial vacuum many international companies involve themselves in when a CEO announces an unexpected retirement or departure.

In the early part of 2006, Dick Parsons made his job an agenda item for the Board of Directors of Time Warner. While the full extent of that meeting is not know it can be reasonably assumed that as a consequence of Mr. Parsons' actions, the Board of Directors began the process of planning and then actioning the recruitment of a new Chief Executive Officer. That board meeting led to the vote that made Jeffrey Bewkes the new CEO of Time Warner and further pushes the company forward beyond its beleaguered past.

Whether it is a family-run business or an international conglomerate, succession planning and then the ultimate election can be difficult, emotional decisions for people who struggle to come to a collective agreement on who and what direction are in the best interest of the company. Time Warner was helped immensely by Dick Parsons who saw himself as a catalyst and bridge to the future as opposed to a man soon to be losing responsibilities, including the role as Chief Executive Officer of Time Warner. What Parsons did see was the need for new leadership after having served for five years, bringing stability to an organization that had managed to trip over itself continually after it merged with AOL in the late 90s during the tech boom.

With a strong pedigree at Home Box Office Mr. Bewkes assumes the role of CEO having been the President and Chief Operating Officer since 2006. He inherits an organization still redefining who it is after Parsons spent the better part of the last five years shedding some of the dead, non-producing aspects of AOL/Time Warner. Focusing on interactive services, cable systems, film entertainment, television networks, and publishing, Time Warner has positioned itself for a bright future as evidenced by Dick Parsons' comments about Bewkes when he called him a results-oriented leader.

Now that Time Warner is at a place of health and security it can focus on growth and building out further its core strengths, something Bewkes appears to be solidly capable at doing. Companies that are looking for a successful way to change leadership will find Time Warner a perfect example. Dick Parsons knew he neither desired nor needed to be CEO for a long time. His vision was to get Time Warner to a specific place and then pass the baton to someone who could take the reins and the company farther than he did. And that decision placed that burden at the feet of Jeffrey Bewkes who now must take Time Warner into its future, with the unwavering support of Dick Parsons, the Board of Directors, and the workforce of Time Warner.

And that connection will be critical to the future of the Time Warner brand.

Sources:
http://www.timewarner.com/corp/newsroom/pr/0,20812,1680750,00.html
http://ir.timewarner.com/downloads/FINAL_TWX%203Q07%20Biz%20Outlook%20Release_110607.pdf