All the CEOs Who Stepped Down in 2017, and What You Can Learn From Them
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2017 saw a raft of chief executives leave their companies. While some exits were expected and came after years of service, others were more surprising, brought on after the discovery of wrongdoing.
Take to heart these lessons learned about transparency, accountability, how to handle shifting marketplaces and how to approach your next chapter from these now former CEOs.
Travis Kalanick, Uber
What happened: 2017 was a tumultuous year for Uber. It began with a $20 million payment to the FTC and controversy regarding Kalanick's position advising President Donald Trump on a White House economic council. There were calls to #DeleteUber following the ride hailing service's comportment during protests of the Trump administration's travel ban. Then in February, former engineer Susan Fowler wrote a blog post chronicling the discrimination and sexual harassment she experienced during her year at the company.
Fowler's post led to an investigation led by former attorney general Eric Holder, which in turn resulted in the firing of more than 20 employees and a complete overhaul of the company's cultural values. Meanwhile, Uber was also engaged in a legal battle with Google over self-driving car technology. In June, Kalanick officially resigned, though he remains a member of the board. In August, former Expedia CEO Dara Khosrowshahi took over Uber's top position.
What you can learn: You reap what you sow. A company culture that prioritizes results and rapid growth over the safety and value of employees cannot sustain itself.
Richard Smith, Equifax
What happened: Following a breach that left 143 million people's personal information vulnerable, Richard Smith, the CEO of the consumer credit reporting agency, announced that he would be retiring from his position. It was later revealed that it was not the first time that the company had been hacked this year. The company's response to the issue was highly criticized, as the website they set up for customers to check whether they had been affected required them to provide their social security numbers to access the information, but in doing so, they may have forfeited their right to sue.
What you can learn: Be transparent, no matter how big the issue is. You only stand to lose trust by continuing to keep customers in the dark.
Marissa Mayer, Yahoo
What happened: Mayer left Google to help turn Yahoo around in 2012, and her time at the internet company was marked with controversy, including a focus on mobile and digital that did not lead to a significant return and significant cybersecurity breaches. With the finalization of Verizon's purchase of Yahoo, Mayer exited from the company with nearly $260 million.
What you can learn: Mayer's legacy at Yahoo is up for debate, although she was able to exit her CEO role with a significant payout.
Kwon Oh-hyun, Samsung Electronics
What happened: After 32 years with the company, Kwon, who had been CEO since 2012, tendered his resignation just a few weeks after Samsung Group heir Jay Y. Lee was sent to prison for a term of five years on charges of bribery. It came as a surprise to the company, which was anticipating record profits of $12.8 billion for the fourth quarter. In a letter to employees, Kwon explained why he decided to leave. "I believe that time has now come for the company [to] start anew, with a new spirit and young leadership to better respond to challenges arising from the rapidly changing IT industry," he wrote."Now the company needs a new leader more than ever."
What you can learn: Strong leadership is knowing when your company needs a new vision -- even if that vision doesn't include you at the helm.
Steve Ells, Chipotle
What happened: The company struggled to regain its standing after E. coli and norovirus outbreaks in 2015 that made roughly 500 customers sick. Despite the company's efforts, concerns about contracting foodborne illnesses arose again thanks to a norovirus outbreak at Virginia Chipotle locations this summer. Also, a Dallas, Texas, location had to be closed due to a mice infestation. "It is clear that we need to move faster to make improvements," Ells said in a statement about his planned exit at the end of November. "Simply put, we need to execute better to ensure our future success." Ells founded the restaurant chain in 1993 and is a trained chef.
What you can learn: Understand when you are not the right person to solve your company's current problem and empower the people who can to do so.
Charlie Ergen, Dish
What happened: In December, the company announced that Ergen is handing the reins over to Erik Carlson, who will be president and CEO after serving as president and chief operating officer. In his new role, Ergen will spend his time developing the company's wireless business. A release from the company noted that the C-Suite at Dish will now "assume a group structure to more effectively organize the company's operational and staff leadership to support DISH TV, Sling TV and the company's wireless business."
What you can learn: When moving in a new direction, you can't succeed without getting everyone on board.
Matt Salzberg, Blue Apron
What happened: At the beginning of December, Salzberg, who is one of the company's co-founders, said he would step down from his post as CEO. This June, the company filed for an IPO, but in the third quarter of the year, it reported that its customer base was down 6 percent from where it was in 2016. In October, the company laid off 300 employees. Over the summer, the company was also struggling getting its new highly technical New Jersey warehouse up and running, and was also dealing with competition from Amazon with the tech behemoth's $13.7 billion purchase of Whole Foods. Salzberg is staying on as executive chairman and the company's chief financial officer Brad Dickerson will take over as CEO.What you can learn: You can never guarantee what the competition will do. Make sure your systems and processes are up to the task of growing demand.
Meg Whitman, HPE
What happened: The former eBay CEO joined HP in 2011 after an unsuccessful campaign to be the governor of California in 2010. During her time at HP, Whitman oversaw the split of the company into two entities, Hewlett Packard Enterprise, which focuses on software and services, and HP Inc., which focuses on computers and printers. "We have a much smaller, much nimbler, much more focused company," Whitman said during the earnings call detailing her exit and replacement, HPE president Antonio Neri. "I think it is absolutely the right time for Antonio and a new generation of leaders to take the reins." Whitman was reportedly interviewing to replace Travis Kalanick at Uber.
What you can learn: Know when it's time to pass the reins.
David Karp, Tumblr
What happened: At the end of the November, Karp announced that he would be leaving the site that he founded in 2007. In 2013, the company was bought by Yahoo for $1.1 billion. In June, Yahoo's sale to Verizon was finalized, which made Tumblr a subsidiary of the new entity that emerged from the deal, Oath. In a letter to employees, Karp had this to say of his exit: "My decision comes after months of reflection on my personal ambitions, and at no cost to my hopefulness for Tumblr's future or the impact I know it can have. The internet is at a crossroads of which this team can play a fundamental role in shaping. You are in the driver seat, and I am so excited to see where you go!"
What you can learn: It's OK to want to move onto something new.
Tim Sullivan, Ancestry
What happened: In September, after holding off on filing for its second IPO, Sullivan, who had been Ancestry's CEO for 12 years, announced that we would be stepping down to take on the role of chairman. Howard Hochhauser, who was the company's chief financial and chief operating officer, became interim CEO. Ancestry went public in 2009 before being bought for $1.6 billion by equity firm Permira in 2012. "I believe it's the perfect time to find the right person to lead the company going forward," Sullivan said in the announcement
What you can learn: Pay close attention to your environment. If the time isn't right to make a big call, trust your gut.
John Bryant, Kellogg's
What happened: In October, Bryant left the cereal maker after seven years as CEO. The company had been reporting lower sales for the past three years as it dealt with customers clamoring for more nutritious alternatives to its offerings, a new supply chain and layoffs in the thousands. Bryant was replaced by Nature's Bounty CEO Steven Cahillane.
What you can learn: How you handle shifting markets will define your legacy.
Mickey Drexler, J.Crew
What happened: After 14 years at the helm of the retailer, the 73-year-old CEO said that he would be stepping down from his role. The announcement came two months after Jenna Lyons, the company's highly visible president and creative director, exited from her position. Drexler, who invested $100 million into the company and owns 10 percent of the business, said the decision to hand the reins over to Jim Brett was his own. "I have been running companies for 37 years and the announcement today is a major change in my life," Drexler said in an interview with WWD. " I am always in a state of impatience. I have been here for 14 years. I thought it was time to move on and lessen up on the day to day." He will remain with the company as chairman.
What you can learn: Go out on your own terms.
Tim Westergren, Pandora
What happened: In June, Westergren, who co-founded the company in 1999, announced that he would be leaving the company after his second stint as CEO. He first served in the role from May 2002 to July 2004. In March of 2016, he replaced chairman, CEO and president Brian McAndrews in the position.
Of his exit, Westergren said, "I came back to the CEO role last year to drive transformation across the business," Westergren said in a statement. "We accomplished far more than we anticipated. We rebuilt Pandora's relationships with the music industry; launched a fantastic Premium on-demand service, and brought a host of tech innovations to our advertising business. With these in place, plus a strengthened balance sheet, I believe Pandora is perfectly poised for its next chapter."
What you can learn: Operate on your own timetable, not anyone else's.
Jerry Storch, Hudson Bay Company
What happened: HBC is the parent company of big name retailers such as Saks Fifth Avenue and Lord & Taylor. After laying off about 2,000 people, the company also saw its stock price decline by 27 percent. Storch, who had been the company's CEO since 2015, announced in October that he would be leaving his post. "I'm looking forward to returning to my advisory firm to work with a range of companies during this transformational time for the retail industry," Storch said in a statement about his exit.
What can you learn: Even if you leave a job, you can take what you learned with you to help make changes in the industry at large.
Russell Simmons, founder of Def Jam Recordings and CEO of Rush Communications
What happened: Simmons left his companies amid allegations of sexual harassment and assault in late November.
What you can learn: Abuses of power are not acceptable. Take responsibility for your actions.
Ken Chenault, American Express
What happened: Chenault announced in October that he would be retiring in 2018. "I've treasured every day of my 37-year career here," Chenault said during a call about his exit. "It's been a journey that spanned profound changes in the world of business." He has been the company's CEO since 2000. In the last two years in particular, Chenault led the company through declining revenue by turning the focus to small-business customers.
What you can learn: It's great to go out on a high note.
Cheryl Bachelder, Popeyes Louisiana Kitchen
What happened: After 10 years in the role, the company announced in March that Bachelder would be leaving her post as CEO following Restaurant Brand International's $1.8 billion purchase of the fast food chain. RBI also owns Burger King and Tim Horton's. In a blog post this spring, Bachelder was candid about how she felt about her exit.
"Work transition, particularly when it is unexpected, brings with it a range of emotions ... the primary one being a sense of loss. Loss of relationships. Loss of role. Loss of a future plan. Loss of financial security ... to name a few. And thus, transition can bring with it a version of grieving that might include emotions like shock, pain, anger, and loneliness. It might feel like you are suddenly without a purpose," she wrote. "In recent weeks, I have felt a sense of loss at this unexpected ending. But thinking about purpose has been an antidote to these thoughts. And I believe purpose will eventually provide the 'answer' to what my next adventure will be."
What you can learn: It's OK to be honest about how you feel about career setbacks. Also don't forget that a new opportunity could be right around the corner.
Mike Cagney, SoFi
What happened: SoFi co-founder Cagney stepped down as CEO after allegations of sexual harassment. A New York Times story detailed how Cagney fostered a toxic company culture, as well as lied to investors and customers about the company's products and services. Tom Hutton, the company's executive chairman, took over as interim CEO. "The business is strong, stable and well-positioned," Hutton said in a statement. "For now, there is no more important work than paving the way for future success by building a transparent, respectful and accountable culture."
What you can learn: Honesty is imperative as you grow your business. Everyone must be held accountable, especially those setting the tone at the top.
Howard Schultz, Starbucks
What happened: In April, Schultz stepped down from his role as CEO to become executive chairman, a position that would allow him to spend his time the company's social initiatives and the growth of the Starbucks Reserve Roasteries and Starbucks Reserve retail stores. The company just opened its biggest location in the world in China.
What you can learn: Cultivating your passions can lead to big results.
Joseph Swedish, Anthem
What happened: After four years at the health insurance provider, Swedish stepped down in November. Gail Boudreaux, who was the CEO of United Healthcare, took over the position. Swedish led the company through a proposed merger deal to buy Cigna for $48 billion. The deal ultimately did not materialize because of regulatory concerns, but had the merger gone through, it would have made Anthem the largest membership-based health insurer.
What can you learn: When making big moves, make sure to proceed with caution.
Rob Rhinehart, Soylent
What happened: Rhineheart, the founder of the food-replacement maker, announced that he would be stepping down in a blog post in December. In 2016, Soylent had to stop production of some of its newer products because customers reported that they were getting sick, but 2017 had been more successful with the company raising $50 million in funding.
In the blog post, Rhineheart explained why he was handing the reins to Bryan Crowley, president of Rosa Foods, the company that owns Soylent. "Along the way I have seen my role as CEO evolve, especially enjoying the process of delegating my responsibilities to more skilled and experienced scientists, managers and executives. These specialists are clearly better at their roles than I would be, especially if I were handling tons of other responsibilities simultaneously, which is the exciting early stage of a startup. But that time has passed."
What you can learn: Understand your limitations and know when it's time to step aside when your company graduates from the startup phase.
John Schattner, Papa John’s
What happened: The founder of the pizza chain found himself embroiled in controversy earlier this year when during an earnings call in November, he weighed in on the ongoing protests by NFL players such as Colin Kaepernick, who kneeled during the playing of the National Anthem to raise awareness about police brutality. Papa John’s is an NFL sponsor. Schattner said “by not resolving the current debacle to the player and owners' satisfaction, NFL leadership has hurt Papa John's shareholders.”
His comments inflamed conversations on social media, and white supremacist groups claimed the chain as the official pizza of “the alt-right.” This year saw decreased sales and declining value of stock shares for the company. Papa John’s then made an explicit statement coming out against the support of the white supremacist groups saying, "We condemn racism in all forms and any and all hate groups that support it. We do not want these individuals or groups to buy our pizza." Schattner announced late December he will step down as CEO but will stay on as chairman of the company’s board. Chief operating officer Steve Ritchie will step in as CEO.
What you can learn: More and more, consumers are looking to the brands they buy to represent their values. That's why leaders should listen and learn first, speak second.