Dan Freed wrote a spot on piece for the thestreet.com on how Bank of America might consider replacing Ken Lewis as CEO. Freed thinks, and so do I, hiring a CEO from outside the bank and possibly outside the banking industry is good idea.
Bank of America’s board might do well to look outside the banking sector for a CEO to replace Ken Lewis, who will leave the post at the end of the year.
Certainly the strategy has worked for Ford Motor Co. which is in the midst of an impressive turnaround without having to rely on government aid as GM and Chrysler have had to do. The architect, of course, is Alan Mulally, who joined Ford as President and CEO in 2006 after a long career at Boeing Co.
Perhaps the best example of an outsider fixing a troubled company is Lou Gerstner, who had no experience in the tech industry when he took the top job at IBM (IBM Quote) in 1993. Gerstner, a veteran of RJR Nabisco and American Express (AXP Quote) is widely credited with saving the company, which was under threat from the rise of the personal computer.
Bank of America needs to find the right candidate rather than settle for someone willing to take on the challenge. Despite rumors of continuing difficulty in finding candidates from the outside, the board needs to redouble its efforts and make sure it diligently pursues a variety of potential candidates. We will just have to wait and see.
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