THANKS TO MEG WHITMAN, EBAY REACHED 1400% INCREASE IN SALES IN 10 YEARS

Learning from the greatest business leaders of the world

Margaret Cushing Whitman (born August 4, 1956) is an American business executive, political activist and philanthropist.

She has earned a B.A. with honours from Princeton University in 1977 and an MBA from Harvard Business School in 1979. Whitman is married to Griffith Harsh IV, a neurosurgeon at Stanford University Medical Centre. They have two sons.

Whitman began her career in 1979 as a Brand Manager at Procter & Gamble in Cincinnati, Ohio. Whitman later moved on to work as a consultant at Bain & Company’s San Francisco office.

She then rose through the ranks to achieve the position of Senior Vice President. Whitman became Vice President of Strategic Planning at The Walt Disney Company in 1989 and in 1995 she became President and CEO of Florists’ Transworld Delivery in 1995.

In the same year, an unknown auction site known as Auctionweb was started by Pierre Omidyar, a computer programmer who wanted to create a ‘perfect market’ where individuals could come together and trade anything they liked. In 1997, the site’s name was changed to ebay and won US $ 6.7 million of venture capital.

The financiers looked for a CEO to look after their investment and their executive search agency contacted Whitman. She wasn’t interested at first but when she paid a visit to the operation in California, she began to see the potential.

After committing herself to ebay, Whitman saw her role as focusing on the wants and needs of the ebay community.

“Their passion for ebay (good and bad) was like nothing I’d ever seen in 20 years of business,” Whitman told the New York Times later.

She believed the site to be confusing and began by building a new executive team. Whitman organised the company by splitting it into 23 business categories. She then assigned executives to each, including some 35,000 subcategories. In 2004, Whitman made several key changes in her management team.

She set about building the ebay brand, launching a national advertising campaign. The company went public in 1998, raising US $ 63 billion. Shares were offered at US $ 18 but closed the first day’s trading at over US $ 47, valuing the company at nearly US $ 1.9 billion and making Whitman a millionaire, thanks to her stock options. Whitman’s advertising campaign began to drive more visitors to the site; by 1999 there were seven million members.

This success came at a cost: the volume of traffic caused the site to crash, sometimes for a whole day. Whitman helped to handle each crisis, working from a cubicle alongside her colleagues, handling customer complaints by phone and email and refunding millions of dollars’ worth of fees.

She invested in a customer service operation that guaranteed a response to customer enquiries within 24 hours. Her goal was always to keep ‘the small-town Salon.com’ feel on a global scale.’

Whitman opened the site to commercial sellers and made some highly focused acquisitions of auction-related businesses. Thereafter, she began to expand overseas; when she left in ebay in 2008, the company was operating in 35 countries and one of her regrets was her failure to break into the Japanese market.

During Whitman’s 10 years at ebay, sales grew from US $ 4 million in 1998 to US $ 8 billion in 2008 and ebay shares appreciated by 1,517 percent.

Whitman resigned as CEO of ebay in November 2007 but remained on the board and served as an advisor to new CEO until late 2008. She was inducted into the U.S. Business Hall of Fame in 2008.

“I’ve said for some time that 10 years is roughly the right time to stay at the helm at a company like ours,” she said in an interview, adding that “it’s time for new leadership, a new perspective and a new vision.”

Whitman has received numerous awards and accolades for her work at ebay. She was named among the top five most powerful women by the Fortune magazine. Harvard Business Review named her the eighth-best-performing CEO of the past decade and the Financial Times named her as one of the 50 faces that shaped the decade.

In January 2011, Whitman joined Hewlettpackard’s board of directors. She was there for six years.

What lessons can we learn from Meg Whitman? Get ready

Whitman’s impeccable credentials, which include a Harvard MBA, reflect her strong belief in getting the best education and preparation possible.

“I’m a big believer in getting well trained. Go to the best possible university and best possible company. It’s all about how much you can learn and how fast.”

Boldly go

Whitman shared the experience of getting a call from Pierre Omidyar, the young founder of ebay. At the time, ebay had a couple of dozen employees and a strange black and white ‘Auction Website’ – not exactly the harbinger of the online powerhouse ebay would become.

“What I saw behind the concept was something remarkable: real features and functions with an emotional connection – a winner.”

Whitman took a risk and ‘a huge pay cut’, uprooting her husband and family for the opportunity to grow the start-up.

Watch and listen

“At ebay, I did a lot of listening to our team and our community of users. Our company was growing at a 70 percent compound growth rate so it was important to be inclusive and collaborative.”

ebay became one of the leading sellers of used cars by paying attention to a customer who first listed a car for sale.

“Had we been in a conference room of MBAS it would never have occurred to us to sell used cars. Watch, listen and stay close (to your customers).”

Head and heart

A strong believer in team and culture, Whitman reminded the audience of the importance of analytics and connections.

“Those of us who were trained in business use our left brain. But when you watch politicians, they speak to the right brain. It’s all about the stories they tell. To capture hearts and minds, you have to tell stories.”

Fail forward

Whitman was asked to step down from a position early in her early career for not reducing the company’s debt quickly enough.

“I was devastated. You have to pull up your socks and move forward.”

The lesson learned? Relentlessly manage your P&L. Later in her career, Whitman’s foray into California politics toughened her up.

“I underestimated the challenges of going from business to being a candidate. Politics is a full-on combat sport. I was attacked in every corner. As a result, I am tough as nails now. It made me a better CEO.”

Establish clarity with your reports

Whitman taught her subordinates a practice called ‘blank-sliding’ in which they sat down together at the beginning of each project and created, on paper, a set of ‘slides’ representing the hypothetical presentation they might give at the project’s end.

Each slide had a title, representing a step or goal they envisioned accomplishing but no details, which left her options open for how to accomplish them. When a subordinate judged a step or goal needed to change, that subordinate and Whitman reviewed the slides. That process realigned subordinates with Whitman.

Recognize credit repeatedly

When someone--no matter how junior-came up with what Whitman considered a good idea, she would repeat it with that person’s name: “Well, Jerome said….” And in meetings and conversations thereafter, she made sure to associate the idea with Jerome.

“What’s great is that it makes Jerome want to have another idea and Jane wants to have an idea like Jerome’s.” (Lionel Wijesiri is a retired company director with over 30 years’ experience in senior business management. Presently he is a freelance journalist and could be contacted on lawije@gmail.com)