Who Would You Appoint As CEO of ST?

Last November I was asked by an ST guy who, in my opinion,  would be appointed CEO of ST when Carlo Bozotti’s contract expired in the Spring.

To my surprise, when I put my mind to it, I couldn’t think of anyone. So I replied that I thought Bozotti would be re-appointed.

Yesterday he was.

The huge difficulty to be surmounted is that the French and Italian governments share, equally, a 27.6% state in ST and neither government will allow the appointment of a CEO from any country except their own.

The two countries have a very different attitude to ST. Italy wants it to be a specialist provider in certain niche – though very large niche – markets.

France wants ST to be Europe’s digital champion – competing at the leading edge with the world’s finest.

So the battle is ideological as well as patriotic.

The obvious answer was to appoint someone who wasn’t French or Italian, but that is fraught with difficulty. No one with a decent track record in the industry would want a job so circumscribed by political limitations. So, despite the availability of some great American CEOs, I can’t think of any who’d take the job.

Names have sometimes emerged – Jean-Yves Naouri, COO of Publicis, Marco Patuano, former CEO of Telecom Italia, Eric Meurice former CEO of ASML – but, it seems, either objections have been found to them or none of them wanted it.

It looks like they’ve kicked the can down the road – Bozotti appointed for one more year till May 2018, with a Frenchman, Jean-Marc Chery, appointed ‘Deputy CEO’.

It keeps the show on the road while allowing another year for politicking – something the Continentals rather like – and, with the chip industry fundamentals trending up, it probably doesn’t make much difference who is ST’s CEO for the next year.


Comments

8 comments

  1. I think Mercury would be better than Thor, neitherstnorste, because, more than anything else, ST needs a CEO who can get its message out.

  2. Good point Robetc, it seemed to me that when the current ST management took over in 2005, they soon became concerned by the hovering PE companies which took over Freescale and NXP in 2006. So the ST top management tried to make the company less attractive to PE by making it leaner and meaner – which is incompatible with having two European governments as the largest shareholders owning 27.6% of the stock who want ST to act both as a provider of well-paid EU-based tech jobs and as the EU’s digital champion. Those are a lot of horses to ride simultaneously! Now, 12 years later, ST is diminished, but it has some considerable technological strengths and some excellent people and ST’s most pressing need is to find a Hero to head it. ST haven’t had a hero to lead it since 2005.

  3. The other side of the coin is purchase by PE which seems inevitably to result in the levering of astronomical debts. By contrast though, a combination of market conditions and competent governance can revive a firm post PE if those owners have not irreversibly gutted it. It’s a wicked world whichever way you look.

  4. A lot of people would like to stop it, neitherstnorste, but no one can. The Agrate Cosy Club is impervious to all reform.

  5. That sounds spot on, neitherstnorste, ST has become a Machiavellian cabal dedicated to perpetuating a self-selecting oligarchy. It’s a huge pity and condemns ST, as you say, to long-term decline. Whenever leadership is weak, this tends to happens to organisations – a clique takes over and runs them for their own, personal benefit.

    • neitherstenorst

      indeed, David. The sad thing is that nobody in EU cares to stop this value destruction (which of course does not apply to the bank accounts of the members of such a clique

  6. neitherstenorst

    David,
    for sure the political battlefields play a role in what happened. But, believe me, there is another (set of) factor(s) that did and will prevent anybody from outside ST take the CEO job: ST’s CEO as well as the first-layer clique are going to impose a worth of self-survival conditions that basically prevent any serious restructuring plan from being realistically feasible. Bottom line: taking such a job is a professional suicide. So, ST keeps on in its self-referential slow decay

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