Motorola Inc. had high expectations for Theresa Metty when the company recruited her from IBM in 2000 for a key executive post.
Motorola’s once-proud cell phone division, bloated and ailing, needed radical cost-cutting, and she was among those commissioned to wield the ax. She didn’t disappoint.
She “did a terrific job,” her former boss Mike Zafirovski, now Nortel Networks chief executive, would later recall.
Yet within two years of a promotion that made her one of Motorola’s highest-ranking females, she was on her way out–an isolated and increasingly controversial figure at a company undergoing dramatic change driven by a new leader, Chief Executive Officer Edward Zander.
Metty, 54, filed suit, alleging sex discrimination. And in doing so, she offered a rare window into the professional and personal dramas unfolding at one of the nation’s biggest companies during a seismic shift that altered the course of careers and lives.
Her lawsuit provides a glimpse into the struggles for power, position and money at an organization in the throes of change, where individual fortunes can reverse in a heartbeat.
“It was organizational changes, people that had to be moved, jobs changed, jobs eliminated,” Zander said. “This happens every day in corporate America.”
Statements attributed to Zander and others are from depositions in Metty’s suit unless otherwise noted.
The Motorola with which Metty was familiar was an enigma to the new CEO who arrived from Silicon Valley in January 2004, a transplant with a very different vision for how to run a venerable company with over $30 billion in sales.
He felt confused and frustrated–even suffocated–by Motorola’s bureaucracy, its meeting schedules and feuding business units. “And in between breathing for air in this job I attended a lot of meetings,” he recalled.
Suddenly plunged into a Midwest winter, he suffered culture shock on dark mornings when meetings started at 7 a.m., “which I couldn’t believe maybe because I came from the West Coast,” he said. “I would just like to sleep at 7 a.m.”
He was a stranger in a strange new land where even his title wasn’t his alone. Motorola’s tradition of naming business heads “CEOs” left him incredulous. “You hired me but you have six other CEOs,” he recalled telling Motorola’s board. “There’s seven CEOs in the company. There’s seven CEOs.”
Even the company’s revered quality control program failed to impress. “I’m going like, where’s the output, who is in control?”
He looked toward insiders such as his board liaison–his confidant over coffee at Starbucks in the pre-dawn darkness–to explain Motorola’s ways. His steep learning curve was a path toward “a major reorg” that would change the company’s structure to “the way I wanted it.”
And there would be no room in it for Metty, or for Zafirovski.
Zafirovski himself was new to Motorola in 2000 when he convinced Metty to leave an IBM post where she oversaw $45 billion in global spending.
The pair hit it off–“Mike Z.,” a 6-foot-4-inch Macedonian native who competed in an Ironman triathlon, and the equally intense Metty, who broke land speed records racing a vintage motorcycle she nicknamed “Moto Roller.”
Motorola had brought Zafirovski on board to revive its flagship cell phone business, and with Metty’s help, he would apply the rigorous cost-cutting discipline he’d learned during 24 years at General Electric.
A key target for that discipline: supply chain, the dull-sounding but important operation that manages the flow of everything from semi-conductors to office paper.
What Motorola needed was “a Lopez with ethics” to run its supply chain, Zafirovski said, referring to J. Ignacio Lopez, the erstwhile General Motors purchasing chief known for ruthless efficiency.
Metty became his Lopez. Part of the “top tier” of Motorola executives responsible for the cell phone division’s turnaround, she typically surpassed her cost savings goals, Zafirovski said.
The pair dug in at Motorola during one of the company’s darkest periods, when 60,000 jobs–40 percent of the workforce–were eliminated in three years.
For his performance, Zafirovski was named president and chief operating officer in July 2002, placing him in line to be groomed for the top job. And Metty’s star was hitched firmly to his.
He promoted her to a new corporate post–chief procurement officer, responsible for coordinating billions of dollars in purchasing among Motorola’s fractious divisions. She was now a senior leader with a higher public profile, too.
But Zafirovski suffered a setback in late 2003 when Motorola’s board picked Zander for CEO, a quick-witted former Sun Microsystems executive with a flair for marketing and a gift of gab.
There was tension between the two from the start. Zander’s ideas about how to organize and run a company, shaped by decades at fast-paced high-tech firms, clashed with those of Zafirovski, a devoted GE acolyte.
“We didn’t scream, yell, argue like some COOs and CEOs do, but it was disagreeing philosophically,” Zander said. “I was one [corporate] religion and he was another.”
He chafed at the reporting structure that had business heads answering to Zafirovski rather than him. But he left no doubt who was in charge.
Less than a month into the job, he heard reports that Zafirovski promised the top job in cell phones to a rising star, Ron Garriques, who was tangling with his boss, then-cell phone chief Tom Lynch.
“This is all while I’m trying to learn where the bathroom is,” Zander recalled
Angry and “stunned” that Zafirovski planned high-level personnel changes without consulting him, he summoned his No. 2 and Garriques for a late-night meeting.
“Hey, I don’t know who you are but we don’t run a company this way and Tom is my guy,” he recalled telling Garriques. “And if you don’t like that, maybe you ought to do something else.”
Yet his first encounter with Garriques was memorable. The then-40-year-old, a cohort of Metty, made a positive impression as a “bright guy with a lot of bandwidth,” someone with a future in his new Motorola.
Zander called him back the following night. “Work with me and you’ll get someplace in this company,” he told Garriques. It was a pledge on which he delivered: Garriques replaced Lynch later that year.
Metty, on the other hand, failed to impress Zander.
It seemed to him that purchasing was controlled not by her but by Motorola’s warring divisions. He didn’t seem to know her background at IBM or Motorola, and he couldn’t figure out what she did. When he questioned Zafirovski about her role, “what came back was mushy answers,” he said.
When Metty complained she didn’t have authority to do her job, he told her to talk to Zafirovski.
Meanwhile, Zander was getting to know Metty through another channel–Motorola’s human resources department–and what he was hearing troubled him.
There was a lot of “noise” around her, Zander said–referring to Motorola’s term for managers whose edgy personalities sometimes rubbed people the wrong way.
“The noise around Theresa Metty was about as high on a decibel level as you can get inside Motorola,” he said. “What HR was coming back with, was `Theresa was abusive, she’s intimidating. She was never around.'”
Zafirovski, too, had gotten an earful from HR about Metty in 2004. So he did his own investigation, interviewing Metty’s subordinates.
He concluded she was “high maintenance,” that she rescheduled meetings and maybe traveled too much. But he said he didn’t find the “angst and anger” reported by human resources.
Pushiness in promising managers isn’t uncommon. That’s why management coaches thrive in corporate America, softening the edges of leaders fixated on results.
And Zafirovski brought in one of the best to counsel his edgy up-and-comers: Marshall Goldsmith, dubbed one of the great thinkers in his field.
Goldsmith was retained in 2002 to work with Metty, Garriques and one other executive. The goal for all three: “to fine-tune elements of their leadership style without losing the obsession with results,” Zafirovski said.
The high-profile coach concluded in January 2004 that Metty had made “measurable, positive change in several areas.” But at the same time, he reported that she was “seen as slipping back by some members of Motorola staff.”
Goldsmith opted not to charge Motorola for his work with Metty after an HR manager said the company wasn’t satisfied.
Still, Zafirovski remained very satisfied with her performance, giving her an “excellent” review for 2004. Her annual salary had increased 26 percent to $410,000 since her hiring.
His opinion didn’t seem to matter. Zander would later say that Zafirovski, though “energetic, hardworking, determined,” was a “very poor judge of people.”
Motorola would argue he had a “blind eye” when it came to Metty, partly because she socialized with his wife–a relationship Metty downplays. Zafirovski dismissed any notion of favoritism, saying he could make a list of “15 or 20 high-profile, high(ly) successful Motorola executives” about whom he was said to have had a “blind eye.”
By the summer of 2004, six months into Zander’s tenure, big changes were in the works for Motorola’s supply chain.
While Metty’s staff worked on a plan to centralize procurement, a rival executive was leading an exercise called Project Olympics. Mike Fenger’s grandly named project would become increasingly important in Zander’s reorganization plan and would directly affect her job, yet she sent staff to most meetings rather than going herself.
Increasingly isolated from the new center of power, she also was unaware that her mentor and protector Zafirovski was on his way out. Since summer, Zander had been considering doing without a chief operating officer, while analysts speculated Zafirovski would leave to find a CEO job.
The pair met on a Sunday around Thanksgiving and agreed that Zafirovski’s leaving “probably would be [the] smart thing to do,” Zafirovski said. The announcement was delayed until after the holidays at Zafirovski’s request, so he could “get through Christmas with his family,” Zander said.
After a November meeting with Metty, Zander concluded that she, too, was on her way out. “She told me she was leaving and wanted the package,” Zander said. “I was surprised Theresa was even sitting there in January.”
Metty is adamant she never proposed quitting. “I had no intention of leaving Motorola,” she said in an interview.
In mid-December, Zander unveiled his reorganization. It included a new senior position, a single executive who would reign over Motorola’s entire global supply chain–a Project Olympics recommendation. Henceforth, Metty would have a smaller procurement job and report to this new chief.
On Jan. 12, 2005, Zafirovski made it official: Motorola announced his resignation. And on that same day, the company’s human resources chief offered Metty a choice: She could keep the smaller job or take a severance package.
But if she left, Metty would forfeit a portion of stock-option grants with a face value of $5 million–part of her original employment agreement.
Metty chose the job.
The company’s proposed $512,500 severance payment “didn’t begin to compensate me for what Motorola had promised to do when they recruited me away from IBM,” she said.
She would later contend in a court filing that it was 10 percent to 40 percent of the cash settlements to male executives who exited during the reorganization. Motorola says Metty’s claim is incorrect and that it’s not possible to compare severance packages because they are prepared on a case-by-case basis, reflecting salary levels and years of service.
Her job in the restructured Motorola turned out to be more limited than she had imagined. Fenger, her new boss, laid down the law: no visits to suppliers, no travel without his approval.
The curtain fell on her Motorola career in March 2005 when the company’s top 15 executives–a group Metty no longer was part of–met to review senior managers’ performance.
Fenger recommended that Metty be booted from the chief procurement post, citing “lost credibility” and “poor performance,” according to a Motorola court filing. Motorola also contends the group voted that she and one other executive were the worst performing officers, though she disputes that.
She claims in court filings that Zander himself swayed the senior leaders to push her out of the procurement job–and effectively out of the company. Handwritten notes taken during one of the March meetings and filed in court say, “I want her out–legally–Ed.” The note-taker said the phrase is a “fair reading” of a statement “likely” made by Zander.
Metty was in limbo–still employed by Motorola but without a job. Human resources suggested she apply for other positions within the company, but she felt the suggestion was disingenuous. By April, she was gone.
The stress took a toll. Unable to sleep, she had visited a therapist, who diagnosed post-traumatic stress disorder.
“It was almost as though something broke,” she recalled telling Zafirovski over breakfast after both left Motorola.
“I don’t know any other way to describe it,” Metty said. “After 33 years of an incredible career with positions [of] greater responsibility with every move that I made, to suddenly find myself out. … I don’t know if I’ll ever be able to go back into that kind of a role where you give up your whole life for your company.”
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mhughlett@tribune.com
berose@tribune.com
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Motorola moves
Nov. 2000 – Theresa Metty joins Motorola.
March 2003 – Metty named chief procurement officer.
Jan. 2004 – Edward Zander takes over as CEO.
Nov. 2004 – Metty’s boss Mike Zafirovski agrees to leave.
Dec. 2004 – Zander reorganizes Motorola.
Jan. 2005 – Zafirovski resigns; Metty turns down severance proposal.
March 2005 – Metty removed from procurement job.
April 2005 – Motorola terminates Metty.
July 2005 – Metty sues for sex discrimination, retaliation.
Nov. 2005 – Zafirovsky joins Nortel as CEO and president.
Source: Court records, company documents
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Retaliation alleged over claim of discrimination
Theresa Metty’s suit says Motorola retaliated against her after she alleged that the company discriminated against women.
An expert’s report filed as part of her case argues she was a victim of sex stereotypes that create hostility toward women who succeed in male-dominated fields and toward female executives who adopt a “masculine” leadership style.
She felt pressure to “act like a man” to keep her senior-level post, yet she was simultaneously criticized for her “male-like” management style, according to her July 2005 complaint in U.S. District Court in Chicago.
The case is scheduled for a jury trial Nov. 6, barring dismissal or a settlement. Motorola has asked that the suit be thrown out.
“Motorola believes Metty’s claims of discrimination are entirely without merit,” the company said Friday in an e-mail statement, adding, “Women and minorities serve in key roles across the organization, including several senior leadership positions.”
Motorola said the company has promoted or hired 29 new female vice presidents since Edward Zander became chief executive.
–Barbara Rose and Mike Hughlett
