Jordan, Michael H. 1936–
Michael H. Jordan
Chairman and chief executive officer, Electronic Data Systems; chairman, eOriginal
Family: Married Kim (maiden name unknown; marriage ended); married Hilary Cecil; children: three.
Career: McKinsey & Company, 1964–1974, consultant and principal; PepsiCo, 1974–1986, held various positions including director of financial planning, executive vice president and chief financial officer, president of Frito Lay, and president of PepsiCo Foods International; 1986–1990, president and chief executive officer of PepsiCo Worldwide Foods; 1990–1992, chief executive officer; Clayton, Dubilier & Rice, 1992–1993, partner; Westinghouse Electric Corporation, 1993–1998, chairman and chief executive officer; CBS Corporation, 1995–1998, chairman and chief executive officer; Luminant Worldwide Corporporation, 1999–2001, chairman; eOriginal, 1999–, chairman; Electronic Data Systems, 2003–, chairman and chief executive officer.
Address: EDS Headquarters, 5400 Legacy Drive, Plano, Texas 75024-3199; http://www.eds.com.
■ Trained as a chemical engineer, Michael H. Jordan's business career began in consulting. After joining PepsiCo as a planner, Jordan continually honed his corporate skills and was named president in 1986. Following 18 years with PepsiCo, Jordan demonstrated his strategic prowess at the helm of Westinghouse Electric Corporation, where he orchestrated a major corporate transformation that included the acquisition of CBS Corporation. At age 66 Jordan was coaxed out of semiretirement to reinvigorate the computer-services giant Electronic Data Systems (EDS), which had seen its stock fall sharply under previous leadership.
Jordan was raised in a lower-middle-class area of Kansas City, Missouri, in the wake of the Great Depression. From an early age he desired to have a career in which his talent would be in demand no matter what shape the U.S. economy was in. Following high school Jordan earned an academic scholarship to Yale University, where he received a chemical engineering degree in 1957 and developed a passion for science. In the Dallas Morning News, he explained: "I love the rigor of science, the opportunity to generate hypotheses, to figure them out, to try to prove or disprove them" (April 10, 2003).
Jordan went on to earn a master's degree in chemical engineering from Princeton University in 1959. He considered pursuing a doctorate but ultimately decided that the laboratory life was too isolated and joined the navy. Jordan entered the nuclear submarine program and received a certificate in nuclear engineering in 1960 from the U.S. Navy Westinghouse Bettis Atomic Power Laboratory. Upon discharge, Jordan joined McKinsey & Company as a consultant in 1964, where his business career would blossom over the course of 10 years. Jordan felt that McKinsey's approach to problem solving was very much like the one he used as a scientist.
In 1974 Jordan joined PepsiCo as head of corporate planning. His accomplishments at Pepsi included expansion of the company's international snack-food business. Under his leadership sales within the category grew to $1.8 billion in 1991, up from $300 million in 1986.
Jordan was tapped to rescue the troubled Westinghouse Electric Corporation in 1993. The company was saddled with $6 billion in debt related to its poorly managed Westinghouse Financial Services division, which dabbled in commercial real estate, leveraged buyouts, and junk bonds. As chairman and CEO, Jordan was the first outsider to lead the enterprise. Within two years he sold the company's defense-electronics and office-furniture units and cut 7,200 jobs.
Next, Jordan completely transformed the struggling enterprise by acquiring CBS Corporation for $5.4 billion in 1995. As Jordan's restructuring plan continued to unfold, Westinghouse began focusing more heavily on media properties. This was reflected in the company's June 1996 merger with radio giant Infinity Broadcasting. In December 1997, Westinghouse ceased to exist when Jordan announced the company would completely shed its industrial divisions and become simply CBS. Jordan was praised for exhibiting confidence while making big changes and maintaining composure under the scrutiny of investors and the news media.
Jordan has been described as being intellectual, analytical, contemplative, and quiet. Prior to accepting the top post at EDS, he finished writing a mystery novel. These traits have been interpreted in different ways. While he was at the helm of CBS, Fortune named Jordan one of the nation's least charismatic CEOs, and some observers called him unimaginative. Others, however, described Jordan as being personable and informal, as someone who opted for casual dress and enjoyed engaging in deep conversations. In any case, many agreed that he was a skilled corporate turnaround artist and a gifted dealmaker.
When the financially troubled EDS fired its chairman and CEO, Dick Brown, in March 2003, Jordan, a Dallas resident who had ties to a number of EDS board members, was chosen as his successor. EDS's stock had fallen sharply in the previous six months amid a weak economy, reduced corporate spending, and poor management decisions. In addition, lofty forecasts by Brown had failed to materialize, leading to drastic revisions to the company's third-quarter earnings and a subsequent investigation by the Securities and Exchange Commission.
Along with former EDS employee Jeff Heller, who was rehired as chief operating officer, Jordan sought to turn things around. He immediately took the position that EDS was a solid company that lacked strategic focus and said he would concentrate on improving morale, as well as identifying the things that set EDS apart from its competitors. In addition, Jordan called for a more accurate method of calculating revenue projections. A review of EDS's human-resources policies quickly followed, leading to increased funds for salary increases and bonuses, as well as an improved severance package.
Jordan then began what he called an "evolutionary process" of rebuilding EDS over the course of several years. This included plans to expand in low-cost nations like India and the Philippines. In 2004 EDS sought to increase its workforce in such countries from 9,000 to 20,000 by the year's end. Jordan also called for cost reductions, and EDS shed more than 5,000 workers during his first year with the company. Eventually, Jordan declared that EDS had reduced expenses to the point where it could once again compete against the likes of IBM, vying for contracts that would have been out of reach a year earlier.
Although Jordan faced further challenges, the work was made easier by his appointing trusted colleagues in several key EDS positions and a new management approach that included locating senior executive offices in closer proximity. Commenting on the "new" EDS culture in the Dallas Morning News, Jordan said: "I'd say what's interesting now is the intensity and the rapidity with which things happen in the company. You don't screw around studying stuff. You just say: 'OK, let's get at it. Let's go after this'" (February 11, 2004).
See also entries on CBS Corporation, Electronic Data Systems Corporation, McKinsey & Company, Inc., Pepsico, Inc., and Westinghouse Electric Corporation in International Directory of Company Histories.
sources for further information
Fuquay, Jim, "New EDS Chairman Says Company on Way to Recovery," Fort Worth Star-Telegram, January 28, 2004.
Harrison, Crayton, "EDS Chief Taps Old Friends for Top Spots in Effort to Revive Firm's Fortunes," Dallas Morning News, November 19, 2003.
——, "Electronic Data Systems Finalizes Plan for Cost Cutting, Strategy Tweaking," Dallas Morning News, June 19, 2003.
——, "Electronic Data Systems Has Right Strategy, Leadership Now, CEO Says," Dallas Morning News, February 11, 2004.
——, "New CEO's Background May Be Key to EDS' Turnaround," Dallas Morning News, April 10, 2003.
Hylton, Richard D., "If You Like Turnarounds, Look at Westinghouse," Fortune, March 6, 1995, p. 210.
Labich, Kenneth, "Maybe Jordan Does Know What He's Doing at Westinghouse," Fortune, July 22, 1996, p. 20.
Landy, Heather, "Changes Suit New Chairman at EDS," Fort Worth Star-Telegram, March 21, 2003.
Romero, Simon, "In a Low Key, New E.D.S. Chief Hopes to Regain Skeptics' Trust," New York Times, May 20, 2003.
"Westinghouse RIP," Economist, November 29, 1997, p. 63.
—Paul R. Greenland