Bill borrowed $9,000 on his credit card to start ESPN. He made a deal with RCA to rent what they call a transponder, which was a device that would allow him to broadcast into people’s homes. The reason he was able to do it was he wouldn’t have to pay them until 120 days after he signed the contract. His defining moment came when he made the decision to start a 30-minute sports program called Sports Center. That’s what put ESPN on the map. They were able then to strike a deal with Anheuser Busch for $1.3 million to advertise their products. And the rest is history. ESPN went on to become a dramatic success.
Then you’ve got Sanford (Sandy) McDonnell, the former chairman and CEO of McDonnell Douglas, which is now part of Boeing. His uncle ran the company; it was a one-man-rule type of business. When Sandy took over, he felt that he wasn’t capable of making all the decisions alone. He needed other management people with him. So he sought advice from a number of people who talked to him about becoming much more professionally managed. So he moved McDonnell Douglas from a one-person-rule into a professionally managed company. That was his defining moment because he was able to build participative management. It was just a real good decision because it got people involved who had a lot of skills but who previously were not able to implement them.
Knowledge@Wharton: Apart from career choices or career decisions, what other defining moments did the CEOs tell you about?
Steinbaum: Take Richard Mahoney, who was the CEO of Monsanto. Its core business was in trouble and he had to reposition and refocus that company. Monsanto was in the chemical and petrochemical business, and those products became commodity items. Richard developed, through a long-range plan, the ability to get into agriculture, pharmaceuticals and life sciences. In my opinion, that was probably the greatest transformation of an American company in the history of business. It was just that impactful.
Knowledge@Wharton: Over the course of a career, how often might a person be called upon to make these defining decisions? Did any CEOs have to do it more than once?
Steinbaum: Some of them had more than one defining moment decisions. It was a question of which was the most important. Shelly Lazarus is the former CEO of Ogilvy & Mather Worldwide, one of the world’s largest public relations and advertising firms. Her defining moment came when she went back to work after the birth of her third child. It continued when she became the chairman of Ogilvy Direct. [Ogilvy Direct, now called Ogilvy One, is the firm’s direct-marketing arm.) Her final defining moment came when Ogilvy & Mather had been acquired by a British company. It was a hostile takeover, and the morale was terrible. The company was having all kinds of problems. Lazarus was asked to take over managing that business, which she did – and she turned everything around and grew that company. She was able to do that as a result of the various steps that she went through to get to that point.
Knowledge@Wharton: I’m glad you mentioned Lazarus. You interviewed both men and women leaders for your book. Did you find any gender-based differences in the ways they identified and dealt with their defining moments?
Steinbaum: No. Most of the women CEOs had families, and they were able to be good mothers and spouses and at the same time run their businesses in a very professional and hard-hitting way. It was very, very impressive.
There’s another CEO by the name of David Stewart who is chairman of World Wide Technology. David started with absolutely nothing. He worked for Federal Express; he was their top salesman. David was extremely religious and relied on the Bible and relied on God to make decisions, business decisions. That helped give him the strength and the courage to strike out on his own. Today he owns and runs the largest African-American owned company in the country – and the most profitable one, I might add. He is a man of deep conviction.
