In a sense, Waste Management Inc. may have been a prime example of the Peter Principle and the misfortune that can befall a company when its leaders are not up to their jobs.
“I would not say that Waste Management failed leadership. The leadership failed Waste Management,” said Peter Huizenga, the Oak Brook company’s largest individual stockholder, a former member of the company’s board and controller of the family trust.
In those two brief sentences, Huizenga, the cousin of Waste Management co-founder H. Wayne Huizenga, laid the blame for the company’s virtual collapse at the feet of Dean L. Buntrock, Waste’s former longtime chairman and chief executive officer, and Phillip Rooney, who briefly succeeded Buntrock as CEO until shareholders forced him out last year.
Founded 30 years ago, the Oak Brook-based company quickly grew under the leadership of Wayne Huizenga, now part-owner of the Miami Dolphins football team and Florida Marlins baseball team and a bevy of other companies, including Republic Industries Inc., which has interests in car dealership and garbage hauling.
He was assisted by Waste’s two other co-founders, Buntrock and Lawrence Beck.
Wayne Huizenga was the visionary. Buntrock and Beck were the garbage men.
In 1968, Buntrock convinced Beck to merge their scavenger services and a couple of others into a company called Waste Management, and buy what would become the CID-Calumet Industrial District-landfill on Chicago’s Far South Side.
Back then, smelly town dumps, smoldering incinerators and mom-and-pop scavenger services were the norm for garbage disposal in America.
Sixteen years later, Wayne Huizenga cashed in his chips after growing increasingly tired of the weekly trips between his Ft. Lauderdale home and Oak Brook.
His 1984 departure, along with Beck’s retirement, left the company without the leader it needed to oversee what had grown into a $10 billion conglomerate.
“What happened was the leadership that we had to put together in the early days drifted away and new leadership was not put in place with the same quality,” said Peter Huizenga, who owns 8 million Waste Management shares, or about 2 percent.
Under Buntrock, Waste Management branched into related businesses like recycling and water treatment. Buntrock also convinced shareholders to change the company’s name to WMX Technologies Inc. to reflect its wider holdings as the world’s biggest environmental services company. The company never fully recovered.
From his seat on the company’s board, Peter Huizenga said, he watched a company grow so big that Buntrock and his handpicked successor Rooney “were not able to take (it) to the next plateau.”
But Huizenga and Buntrock agreed that shareholders should benefit from Waste Management’s sale to Houston-based USA Waste Services Inc., an upstart that is paying more than $21 billion in stock and assumed debt to become the nation’s No. 1 garbage company.
“This merger is a powerful combination and should enable shareholders, customers and employees of both companies to benefit,” Buntrock said in a statement.
It’s probably the only thing the two have agreed upon recently.
Buntrock’s end came before Waste Management’s. Last summer, after taking back the CEO’s office on an interim basis when Rooney quit, Buntrock gave up the chief executive’s job when Ronald LeMay was named his successor. Then, last fall, Buntrock stepped down as chairman when LeMay quit, too.
The board concluded it could find a permanent chief executive only if Buntrock was no longer around to meddle.
Peter Huizenga said he could sum up the failures of Buntrock and Rooney simply.
“The reason why Rooney and Buntrock were not there to see the finish or to pass Waste Management on to glory was because of their own limitations–their inability to successfully run the company in the 1990s,” he said.
“From the point of view from one who has been there from the beginning, it’s sad to see the end of a company as we had built it. It’s a shame that the wonderful company we built was not able to be sustained,” said Huizenga.
