Retensa’s Top 10 “Biggest Quits” of 2011

Annual review of the most significant voluntary resignations in the United States.

New York, NY, January, 2012 – 2011 saw more organizations lose employees after 20 months than 20 years. We passed the tipping point of settling into the same office, at the same company, and putting in your 40 years. Does this reflect a cultural trend, as American’s quest for instant gratification leads to jumping from one “It” company to the next? Maybe it is a result of the ever-present volatility, manifesting in erratic stock prices, uncertain national credit ratings, Occupy protests at home and the Arab Spring abroad. Whatever the source, this trend is reinforced by a change in how we process and receive information. A greater breadth of news is more immediately accessible and instantly updated than ever before. It compels us to digest short, condensed slices, and experience a fleeting feeling before moving on to the next 140 character emotion. But aren’t careers supposed to be longer than 140 characters? As in previous years Retensa identifies the “Biggest Quits” across all industries highlighting the year’s most important departures spurred by poor planning, poor support or poor talent strategy on the part of the organization. We are pleased to present the seventh annual publication of Retensa’s Top 10 “Biggest Quits” – the most intriguing turnover stories of 2011.

Steve Jobs (Co-Founder and CEO): Apple

Pioneer. Visionary. Ruthless. Genius. When Jobs stepped down as CEO of Apple in August many words were echoed by both those who knew him personally and those who competed with him. Jobs passing away in October, after his eight year battle with pancreatic cancer, created an unprecedented outpouring of appreciation for a corporate CEO. Jobs’ list of business accomplishments is extensive. However, his contribution to advancing of modern technology is incalculable. Jobs was synonymous with the Apple brand. With the two so tightly intertwined, removing one would have to damage the other. Apple must now move forward without the man who was the face of their organization for (most of) the last 30 years. It is clear that no one can step into Jobs’ shoes. What is possible, is leadership that builds from Jobs’ legacy, while separating itself from it.

George Mitchell (Chief Middle East Envoy) & Dennis Ross (Middle East Envoy): US State Department

As the Arab Spring revolutions in the Middle East unfolded it was clear that a new era of democracy would appear. What wouldwill it be? During a period of democratic upheaval and change, Washington would want to provide stability and consistency to the region, if not leverage the opportunity. Instead, two of the State Department’s top ranking Middle East appointments resigned between May and November. At a delicate juncture, the White HouseHilary Clinton was forced to react to losing replace leaders with expertise on, and familiarity with, officials in Israel, Iran, and Palestine. Ross advised the White House since the Carter administration on affairs in the Middle East. Mitchell previously worked to broker peace in Northern Ireland. After several starts and stops, , but he lost his lost hope of for future success in the Middle East. As it often does with high-performing staff, the frustration of gridlock likely drove his resignation. Ross advised the White House since the Carter administration on affairs in the Middle East. These departures will impact the United States’ policies in the Middle East and already slowed the course of peace in the region.

Theo Epstein (General Manager and Executive Vice President): Boston Red Sox

Epstein was the golden boy in Boston. Hailed as a wunderkind, the Yale alum became the youngest General Manager in MLB history in 2002. It took him only two years to end the Red Sox 86-year “World Series curse”. He put an exclamation point on his career by orchestrating the Red Sox’s second title in 2007. Epstein successfully blended “Big Market” Baseball with the statistical savvy portrayed in “Moneyball,” to win honors as a top sports executive of the decade from both Sporting News and Sports Illustrated in 2009. Just two years later, following a late season collapse and numerous internal issues and resignations, Epstein announced his own departure. He left the Sox without their most stable figure in the last decade when they needed him most. Shortly after walking, Epstein joined competing Chicago Cubs as President of Baseball Operations, giving him the unique opportunity to end the Cubs’103-year World Series drought and to create a legacy as the greatest baseball executive of all time.

Margo Georgiadis (Chief Operating Officer): Groupon

In December of 2010 Groupon was projected to make $1 Billion in sales faster than any company in history. Groupon turned down a buyout offer from Google shortly after. In June, Groupon filed with the SEC to go public. However, their business model is as revolutionary as it is replicable. So concerns about Groupon’s stability and long term viability grew as well. Some reports go so far as to claim Groupon owes over $200 Million more than it has, further complicating how to value the company. Georgiadis’ short tenure may give credence to such fears. After Rob Solomon vacated the position after only a year, Georgiadis lasted for only five months. It does not help that Georgiadis left her position at Google, only to return to her former employer around the same time Google launched Google Offers, a direct competitor to Groupon. It is not clear why Georgiadis departed so quickly, but losing two COO’s in the same year is not a good buy for a company so big on deals.

Regis Philbin (Talk Show Host): ABC Broadcasting

After holding the Guinness World Record title for most hours spent in front of a TV camera (16,780 to be exact), the long time Live! with Regis and Kelly talk show host signed off on November 18, 2011. For over 28 years American started their day with “Reege” and let him into their homes with his easily excitable yet warm personality. After working his way up the ranks as an NBC page for The Tonight Show in the 1950s, and hosting many other programs including Who Wants to Be a Millionaire and America’s Got Talent, Regis insists that he is not retiring, just moving on to his next project. It will be very hard to replace Regis’s seat as the “Big Daddy” of television and maintain ABC’s average 3.4 Million viewers per day. Whatever the 80 year old’s next venture, it is the end of an era for morning talk shows.

Robert Gillette (CEO): First Solar

First Solar is the world’s largest solar company. So it was a big quit when the CEO, Robert Gillette, stepped down after just two years. Once the CEO’s departure was announced, First Solar’s stock spiraled downward 25% and dropped even more by year’s end. Gillette’s exact reasons for leaving are still unclear. Morgan Stanley said his “unexpected departure is likely a troubling sign of things to come”. Adding fuel to the fire, Gillette is only the most recent of several First Solar leaders to jump ship this year, including Operations President Bruce Sohn and CFO & Systems Business President Jens Meyerhoff. Now only 1 of 6 company officers remain the same since 2008 (General Counsel). Along with several other solar panel companies facing bankruptcy, it is rumored that darker days are ahead for First Solar.

Barney Frank (US Congressmen): Democratic Party

71 year-old U.S. Congressman Barney Frank will be remembered as a pioneer to many in the United States, pariah to others. In 1987, the Harvard Law graduate announced to America that he was gay, making him the first Congressmen to voluntarily do so.  He continued to fight for gay rights legislation for much of his 30 year tenure. It will be difficult for both the LGBT community and liberal Democrats to replace him in Congress.  Politicians are often criticized for their actions, and Frank is no different, called combative and polarizing, terms often used after co-authoring the Dodd-Frank financial reform. With his retirement, it will become decidedly for more difficult for Democrats to pass progressive legislation. President Obama himself said, “The House of representatives will not be the same without him.” 

Jim Sinegal (Co-Founder & CEO): Costco

Founding the world’s third largest retail chain from a single Kirkland, Washington store is no small feat. Jim Sinegal, Costco Co-Founder and CEO, is retiring at the end of this year after 28 years with the successful company he built. Both consumers and Costco employees alike admire Sinegal as he refused to lay off workers or cut employee benefits, and limited increasing Costco’s prices during difficult economic times. Sinegal’s success is based off of his core values that include honesty, integrity, and modesty, which seem less common in the modern corporate world. Sinegal is retiring at the top as Costco’s profits continue to rise, the stock nears an all-time high, and they perennially place among the best companies to work for. Craig Jenlinek, the CEO’s successor, is said to have very similar values when it comes to running Costco. Jenlinek promised that not much will change without their beloved CEO, especially the indulgently large jars of mayonnaise.

Phil Jackson (Head Coach): Los Angeles Lakers

Most professional athletes and coaches hope for one magical season where everything aligns and they bring home a championship for their city. Phil Jackson doesn’t have enough fingers for his 12 rings. One as a player and 11 as a coach (6 with the Chicago Bull and 5 with the LA Lakers). Some claim that Jackson had it easy, coaching all stars and hall of famers like Michael Jordan, Scotty Pippen, Dennis Rodman, Kobe Bryant, Shaquille O’Neal and Karl Malone. Others praise the Zen Master and say no other coach could have managed the egos and talent to maintain prolonged success as Jackson did. Either way, this Hall of Fame manager had a lot more victories than defeats. His departure leaves the Lakers with a big hole to fill at the coaching position. It is certainly possible that we have not seen the last of Jackson as a coach and we can predict ESPN speculation about his return with every major coaching vacancy that appears.

Martin Staff (Head of Business Development) and Tom Casey (President): American Apparel

Martin Staff, a 40 year veteran of the fashion industry, left after only 6 months. Tom Casey, with 25 years of experience in retail, departed shortly after, lasting only 11 months at American Apparel. Dov Charney, American Apparel’s founder and CEO, is a polarizing figure to say the least. His aggressive and contrarian style of leadership is criticized, and his level of professionalism has been questioned. At the same time, his position as a fair-wage and anti-outsourcing brand helped him to start downtown LA-based American Apparel from nothing. Both praised Charney publicly but also indicated disagreements with the CEO contributed to their decisions to resign. Meanwhile, American Apparel barely escaped filing for Chapter 11 Bankruptcy earlier in the year and it is clear that changes in strategy are necessary. Charney’s managerial style may impede American Apparel’s recovery. If leadership is unable to retain employees capable of saving the company, American Apparel will find it harder to keep from losing its shirt.

Honorable Mentions

Mike Kirkup (Director of Global Relations) and Keith Pardy (Chief Marketing Officer): Research in Motion

Research in Motion’s BlackBerry revolutionized the mobile market, putting “smart-phones” into the world’s hands less than a decade ago. Now, as 2011 comes to a close, Canadian-based RIM is struggling. As of Q3 2011 their stock fell 67%. RIM’s market share in the United States has fallen from a juicy 24% to a sour 9% in the same span of time. Apple and Google’s Android continued to eat into RIM’s market share and both enjoy higher profits and reputation. High level departures like Kirkup and Pardy are an unsettling trend and do little to dispel the “sinking ship” perception around RIM. The resignation of RIM-India CEO Frenny Bawa in November leaves the company scrambling to find leadership while Blackberry’s competitors devour the telecommunication market in the developing regions of India, Africa and the Middle East.

Conclusions: Organizations attempted to navigate the unpredictable waters they faced in 2011 with stable leaders at the helm. But when employees see their captains jump ship what message does it send down the ranks? What message does it send to investors and stakeholders? Instability breeds uncertainty and companies are already faced with the challenge of remaining steady to retain their top talent in an ever-changing workplace. Can newer, younger, organizations survive when their best employees are in a constant state of flux, leaving for the next gamechanging project? For the best, the brightest and the most driven there will always be opportunities elsewhere, putting the onus on organizations to ensure that they take the time to understand how to keep the people and the intellectual capital that will drive future success.

About Retensa

Retensa addresses the social and economic impact of employee turnover for public, private, and non-profit organizations. They apply research, metrics, and technology to help companies develop, motivate, and retain their employees. Employee retention experts can be reached at 212.545.1280 or visit www.retensa.com for speakers, research, and employee retention solutions. Press and media inquiries can be directed to the number above.