blog Indications continue to firm up that NBN Co chief executive Mike Quigley is not long for the position, despite the pivotal role he has played in getting the NBN — Australia’s largest-ever infrastructure project — off the ground. The Financial Review reports today (we recommend you click here for the full article) that NBN Co’s new chair Siobhan McKenna is already looking for Quigley’s replacement:
“NBN Co chairwoman Siobhan McKenna has hired headhunter Egon Zehnder to find a replacement for chief executive Mike Quigley, sources close to the company say.”
I have several thoughts about this.
The first is to question the AFR’s sources on this one (sources, you will note, not inside NBN Co, but ‘close to the company’). Realistically, as this kind of thing would be held in the highest secrecy, it seems as though the AFR’s information could only have come from a handful of sources — McKenna herself, another NBN board member or Egon Zehnder. Other senior executives at NBN Co would be very unlikely to have access to this information, given that Quigley has not publicly resigned his post.
It is, of course, possible that outside executives who have been canvassed for the role would leak such information to the AFR, or the information could even have come from Egon Zehnder itself. But I consider it unlikely — given that this would be incredibly unprofessional behaviour. If a NBN Co board member is leaking information to the AFR about this kind of issue, that would be a very serious matter, indicating that someone on NBN Co’s board is willing to destabilise NBN Co’s management and undercut confidence in its leadership.
With this in mind, I question here whether the AFR’s article is true. Nobody is confirming such a situation at this point, and with Quigley not being known to have resigned or signalled to the board his intention to resign, it seems very unlikely that NBN Co’s board would authorise an executive search for his replacement. I’d like to see some further evidence on this matter before simply believing the AFR’s unsourced report here.
If the AFR’s report is indeed true, and NBN Co is actively looking for a replacement for Quigley, then I would consider this extremely disturbing, unless Quigley has already told the board that he is planning to resign shortly. It is not normal behaviour at all for a major corporation to seek a new chief executive before the current one has signalled their plans to resign (either formally or informally). It is far more normal for major corporations to either put together a succession plan (usually featuring an internal promotion) with the assistance of the chief executive, or for the organisation to seek a new chief executive following the incumbent signalling their intention to resign.
To seek a new chief executive before the incumbent has signalled their intention to resign indicates that the board has very little confidence in the current chief executive. If this is the case, it would be much more normal for a company board to ask the current CEO to resign and appoint an acting CEO (usually internal, often the CFO or COO) in their place while an executive search process is undertaken.
If NBN Co truly is seeking to recruit a new CEO at this point, it indicates one of two things. Firstly, Quigley may have already signalled informally that he plans to retire shortly, and NBN Co’s board is getting ready to replace him. I consider this likely, given Quigley’s been in the job for four years now. That’s a normal amount of time for a CEO to hold their role, and Quigley has accomplished a huge amount in that time. Or secondly, and much more disturbingly, NBN Co’s board, led by McKenna, may be preparing options for the inevitable move by a Coalition Government to sack Quigley and appoint a replacement.
The problem is, neither of these two paths are good ones, in my opinion. This is because, in both of the cases I mentioned above, one might expect that NBN Co’s board should await the outcome of the election before considering options for its next CEO. In either the case that Quigley has already resigned or that NBN Co is merely preparing for a Coalition Government, NBN Co must be aware that both the Coalition and Labor — whichever will be in power after September — will have their own opinion about who the next CEO of NBN Co should be. This Ministerial view will very likely quickly supercede any internal recruitment action NBN Co has taken.
All in all, if the AFR is correct, I am disturbed by what I am seeing here. Any action NBN Co is taking here smacks either of too much consideration for the external political process going on — or not enough. Either way, we are seeing instability at the top of the NBN, and a certain amount of disrespect for the man who has made the NBN what it is today. For all the NBN’s problems, Quigley’s accomplishments as chief executive of this most unusual startup have been remarkable, and he retains the respect of the vast majority of Australia’s telecommunications sector. I don’t want to see Quigley’s departure marked by squabbling over his replacement — it would be unseemly.
Image credit: NBN Co