Leroy Whiteside, president and CEO of Those Fabulous Architects, Inc., a 200-person firm based in Charleston, South Carolina, is a great guy. He is, in many ways, the archetypal design firm principal. He works 60 to 70 hours a week, and he’s willing to get on a plane and head anywhere at any time, no matter what it does to his personal life. He’s a great designer. He loves the work itself and thinks about it non-stop. Clients really value what he does for them, and he has an extensive personal following. He cares about the firm. He is respected inside the company because he is a guy who doesn’t waste company resources and knows what he is talking about. Leroy is at the top of his firm— a company he joined 10 years ago— not because he started it or because he has been there longer than anyone else has, but because he earned it. And when you talk to clients or employees, the good feelings about Leroy are there in everyone.
You would think that a guy who is this good at what he does, has gotten to the top of his company, and who really has a passion for the clients he’s working with and projects that he is doing would be happy in his job, right? Well, you might think that. But in this case, you would be wrong. In fact, to steal a phrase from an old movie favorite, Network, Leroy is “mad as hell, and he’s not going to take it any more.”Why, you ask? I’ll tell you.Every year, the bonus plan that pays him based on the overall company performance is brought up for re-examination by the other principals. “What the heck is this all about?” Leroy is saying to himself. We have had nothing but good years under my leadership. Everyone’s stock is worth eight times what it was only five short years ago, and their annual incomes have tripled in that time period, and these people are still questioning why I get paid $80K more than anyone else? I don’t get it. That’s chump change.”Leroy turned 62 last year and started selling his stock back to the firm. He started selling his stock because he had to. The firm’s policy was that all shareholders had to divest themselves of Those Fabulous Architects, Inc., stock starting at age 62 and have no ownership by age 67. But the fact is, Leroy has no intention of leaving the firm now or at age 67. The guy is in incredible health and competes in triathlons! But it’s not just the fact that he has to sell that’s discouraging him, when right now, he is more valuable than ever to his firm. It’s that the stock is valued at book value, so much lower than its real value, it burns him up! After 25 years in the business and 10 years with the company, his shares of stock are worth only $187,000— pathetic as far as he’s concerned!There just isn’t much talk or appreciation of Leroy coming out of the other shareholders in the firm right now. And it bugs him. He has dealt with everything ugly that needed dealing with. Bad paying clients, owners who retired on the job and didn’t go home, the founder’s ex-wife who still owned some of their stock, and more. No one ever gives him any credit for fixing this stuff. But what he does hear is that the firm should be more profitable than it is, that one shareholder isn’t getting along with another, that the accounting department isn’t liked by the line and production staff, that one of his clients (who happened to pay the firm $3 million last year) is taking too long to pay their bills, that no one liked his team’s design for the Whatsit project, and more. So what’s going to happen? I don’t know. I guess if Leroy gets angry enough, he’ll quit. That may be good in terms of opening up some opportunities for some other people in the company, but it would hurt the firm big-time in other ways. More likely, he’ll probably stay, and be just be a little more bitter and demotivated.Originally published 2/18/2002.
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