EMC's next CEO - a Tucci subject
When Joe goes, who's up?
Comment One man holds all the reins of executive power at EMC - Joe Tucci, chairman, president and CEO. He says management succession planning is a key item - but there is no visible succession plan at EMC. At all.
A person familiar with the situation asks: "What is he (Tucci) doing about this? Who is lined up to take over? There is no succession plan... no one credible lined up."
Contrast the position at NetApp, where COO Tom Georgens basks in CEO Dan Warmenhoven's provisional approval as heir-apparent.
With Tucci in his 62nd year, he has only a few more years of executive leadership left, after which he can be expected to remain on EMC's board. The company is quite open about the need for senior management succession planning. It is part of the corporate governance function which is a board of directors' responsibility.
EMC Board succession responsibilities
The board is organised into various committees, one of which is a Corporate Governance and Nominating Committee. The chair is David Strohm, and there are two other members, Gail Deegan and Windle Priem. Win Priem is also the chair of a Leadership and Compensation Committee whose other members include Michael Brown, Randolph Cowen, and David Strohm.
Strohm is the board's Lead Director, appointed in October 2005, whose responsibilities include "working with the chairman to set the agenda for board meetings, presiding at executive sessions of the 'non-management' board members, and overseeing performance evaluations of the board." Clearly, David Strohm has a kingmaker role, and Win Priem is also hugely influential.
EMC's corporate governance guidelines say "The Board monitors the performance of the CEO and senior management and plans for succession to the position of CEO and other senior management positions." The lead director will "in collaboration with the Leadership and Compensation Committee, approve CEO goals, evaluate CEO performance, set CEO compensation levels and review CEO succession planning."
This is all very open and clear cut with definite responsibilities.
The board as a whole is responsible for CEO selection and performance review. Section 22 of the corporate guidelines states: "The CEO shall submit an annual report to the Leadership and Compensation Committee and the Lead Director (if any) regarding succession planning for the CEO and other senior management positions. This report will include an assessment of senior officers and their potential to succeed to the CEO and other senior management positions."
The CEO also maintains an up-to-date short term emergency succession plan.
This is the CEO succession framework, and we know that the board requires there to be a CEO succession plan and that Tucci himself writes it and that "after review and discussion, the CEO, the Chair of the Leadership and Compensation Committee and the Lead Director shall submit this report to the Board" - meaning Joe Tucci, Win Priem, and David Strohm.
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