One of the biggest developments in the market over this past week has been the drama with Nvidia. It is like something straight out of an HBO drama and now Nvidia might be looking for a new CEO. The main thing I am seeing is people are overvaluing what a CEO does.
A good CEO is the visionary. They are the public face of the company and if they are really good they become more cult leader than business professional. The perfect example is Steve Jobs with Apple. People believed in him, believed in his vision. The question for Nvidia is how much does that matter for a B2B company.
All a new CEO has to do is be loyal to the vision. Tim Cook changed nothing about Apple’s identity. He didn’t start trimming unprofitable parts of the business and making customers feel like they don’t matter. When Howard Shultz left Starbucks it transformed from a third place into a drive-thru. It completely lost its identity, and small things matter. The free birthday drink went from your birth month to the week of your birthday to on your birthday to I’m not bothering to show up anymore.
The thing is even if Nvidia changes CEOs it is going to be awhile before it shows up in the strategy. They likely have a five and ten year plan. A roadmap already laid out and being integrated. The best place to look might be Disney from 1966 to 1971. Walt, the visionary, passed before Roy, the integrator, and at that point they both probably had little to do with the actual day to day operation.
People are questioning whether there is an exit plan and a company doesn’t get to the size of Nvidia without having one. Their CEO very likely has one already in place. It might not be public knowledge, but he has an exit plan. Every now and then the market hands you something obvious and that’s when things start to get interesting.
