Dancing With the CEOs at Borland, Citigroup, and Apple

Tod Nielsen, Chief Executive of Borland Software, is moving from the top honcho role at the software development provider to a supporting role as chief operating officer at VMware, a leader in desktop and storage virtualization. Borland was reticent on the reason behind Nielsen's resignation -- other than to say "the appointment of Erik Prusch to Acting President and CEO was consistent with the Board's on-going succession planning process." Might the fact that the company is expecting a significant year-on-year sales shortfall -- fourth-quarter 2008 sales are expected to come in at about $40 million, down from fourth-quarter 2007 sales of $61.5 million -- be the catalyst behind the executive shuffle?Of interest, the company made no mention of plans to recruit a new CEO. Could the lack of clarity on succession be a budget issue, too? In the same announcement, Borland revealed Prusch will not be getting extra pay for additional responsibilities and, in another cost-cutting initiative, 130 employees, or 15 percent of the work staff, will be let go during the first quarter 2009.

Borland's current experience with executive succession matters is in sharp contrast to the drama playing out at Apple Inc. Investors have been fretting for months about the ability of Steve Jobs to lead Apple, given his apparent health issues. How the PC and gadgets company handled dissemination of news on the health of its chief executive has triggered an investigation by the Securities and Exchange Commission, according to a report by the Bloomberg news agency. The SEC purportedly wants to ensure Apple did not mislead investors about Jobs' health.

The question of executive succession is one of expendability. At Apple, investors apparently view Jobs as irreplaceable, making the road ahead bumpy for Chief Operating Officer Tim Cook, who will lead day-to-day operations in Jobs' absence. Borland's Prusch will likely not have the SEC peering over his shoulder, for the company has a paltry market capitalization of $49.5 million. Borland just does not receive the media interest showered on Apple, with a $79 billion market cap.

For the shareholder, however, financial stakes are just as real at Borland. BORL shares are trading 75 percent below the stock's 52-week high. AAPL shares are down 57 percent from its year high.

Then there is the issue of management change at Citigroup. The financial web logs and chat rooms are abuzz with talk about the future of the faltering financial titan's chief executive, Vikram Pandit. Although Pandit sacrificed his bonus for last year, even that gesture may not be enough to silence the clamor for blood at the beleaguered bank. Would the "succession planning process" make room for Pandit at Borland?

Image Credit: ABC, "Dancing With The Stars"

Reporting by contributor Debra Fiakas, who does not hold a financial interest in any stocks mentioned in this article. The 10-Q Detective has a Full Disclosure Policy.