The chaos greeting David C. Peterschmidt at Openwave Systems Inc. seemed like stepping into a zoo to find animals running wild.
When he arrived in November 2004 as president and CEO, the company was digging out of the hole it had fallen into following the tech bust. Revenue had declined by 38 percent between fiscal years 2001 and 2004. And while it had slowly started increasing prior to his arrival, it wasn’t translating to profits, and fiscal 2004 ended with a $30.5 million net loss.
Additionally, several acquisitions hadn’t been integrated, and Openwave, which makes software for the mobile phone industry, lacked a clear focus and communication strategy.
To add to his challenge, employees greeted him with open cynicism, assuming he was just another suit there to talk a lot and solve nothing.
He didn’t waste any time getting started, taking off around the globe for 60 days to talk to employees, customers, investors and analysts to find the root of the company’s problems and discover new opportunities.
What he found were employees with overlapping jobs, a bonus system based on who you knew instead of on merit, and customers dictating deal terms, resulting in financial losses. Armed with this new knowledge, he set to changing the organization.
“CEOs have three primary jobs,” Peterschmidt says. “One is to make sure there’s a clear strategic plan and vision for the company; two, that the company is staffed with the appropriate management team to execute that plan; and then three, when you’ve got that, you’ve got to spend a tremendous amount of time communicating internally to the employees around the world and externally to your customers, to investors and to your industry what it is you’re doing as a company.”