When Kevin Kennedy was asked to take the reins as president
and CEO of JDS Uniphase Corp. in September 2003, the technology company was quickly drowning after finishing fiscal 2003 with
$676 million in net revenue and a net loss of $934 million.
“This was a company that was an iconic boom in the telecom
upswing and was equally iconic on the downswing,” Kennedy
says. “I say that, in a sense, that by 2003, it had lost 88 percent of
its revenues and about 98 percent of its market cap.”
On top of financial issues, the company was completely disjointed in terms of its leadership.
“This was a confederation of probably 18 to 20 acquisitions,” he
says. “There were two chairmen. … There had been about three or
four CEOs in a four- to six-year period and maybe three or four
COOs in that same period, and many of them were still here, so the
leadership clarity was not strong. People were trying to figure out
who do they listen to. Was it the current CEO or the last guy or the
next guy?”
On top of these issues, the cultures had never fully integrated
during all of those acquisitions.
“It was somewhat of a septic culture,” Kennedy says. “People had
to be laid off. … It was not a pleasant situation.”
With the perfect storm for failure already striking, Kennedy knew
that turning the company around wouldn’t be a leisurely cruise, so
he had a frank talk with the board about what he believed to be the
main problems facing the company before agreeing to take the
position.
“If they didn’t think that was the case, I was probably the wrong
person to be applying for the job,” Kennedy says. “Either I was convincing or they were hard up, but we ended up moving forward
together.”