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IP: AT&T Heir Apparent Quits Troubled Firm After 9 Months [no
From: David Farber <farber () cis upenn edu>
Date: Thu, 17 Jul 1997 11:46:40 -0400
AT&T Heir Apparent Quits Troubled Firm After 9 Months By Paul Farhi Washington Post Staff Writer Thursday, July 17, 1997; Page A01 AT&T Corp.'s No. 2 executive resigned abruptly yesterday, just nine months after he was brought into the ailing long-distance giant as an apprentice chief executive. His departure marks another misstep by a corporate icon that has never found sure footing since its monopoly era was ended by court order in 1984. Wall Street was flabbergasted last fall when John R. Walter, a telephone-book and database executive with no real experience in the business of telecommunications, was named president with the understanding he would take the top job in about 18 months. His patron, chief executive Robert Allen, assured the board and the industry that Walter was a quick study who would give the company's leadership the new blood it needed. But in a telephone press conference, AT&T board member Walter Y. Elisha said AT&T's eight outside board members yesterday "unanimously" concluded that Walter lacked the "intellectual leadership" needed to run the company. "Our action today suggests we erred in bringing him in in the first place," he said, adding that with technology changing so rapidly, the board in recent weeks had become "increasingly concerned." an extract from the FT story is more interesting...
AT&T refused to comment on the specific shortcomings that had prevented Mr Walter getting the top job. However, Mr Elisha said: "We watched John in board meetings and listened to him as he talked about the business and we became increasingly concerned about whether he could provide...intellectual leadership." Mr Walters' time at the company will have earned him $25.8m in all, including a $3.8m severance payment and the money paid to lure him in the first place, AT&T said. This was in line with the sums paid to senior executives who have been lured by other big US companies, including Mr Louis Gerstner, IBM chairman, and Mr George Fisher, chairman of Eastman Kodak, said Mr Elisha. AT&T has started an immediate search for a replacement.
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