You're Fired. Now What?

Managing
You're Fired. Now What?
Hannah Clark, 02.05.07, 6:00 AM ET

Kevin Rollins can't be feeling good about himself. After two years at the helm of PC maker Dell, he resigned last week, and founder Michael Dell took the CEO job. Rollins' story is an old one: The founding entrepreneur retires, and the new chief executive just can't make the company work. Robert Nardelli, the recently-ousted chief of Home Depot, also struggled when he took over from the company's co-founder, Arthur Blank, in late 2000.

But Rollins and Nardelli can both recover, says Yale professor Jeffrey Sonnenfeld, co-author of Firing Back: How Great Leaders Rebound After Career Disasters. When leaders suffer a setback--say, an embarrassing ouster--they need to admit they messed up, Sonnenfeld says. Then they should take a step back and choose an opportunity that actually fits their skills.

Sonnenfeld spoke with Forbes.com about what Rollins and Nardelli can learn from Janet Jackson and Russell Crowe. (Hint: Avoid using the word "if.")

In Pictures: CEOs Who Survived Career Disasters

Forbes.com: What went wrong with Kevin Rollins at Dell?

Sonnenfeld: I know Kevin Rollins and Michael Dell. Kevin is brilliant, hard-working and of impeccable character--but not an entrepreneur who knew how to deal with failure. True entrepreneurs like Michael Dell, Charles Schwab and Steve Jobs have hit the wall of disappointment and know how to reinvent themselves and discover new heroic missions for their enterprise.

Too often, those who follow an entrepreneur--like Nardelli at Home Depot--tend to focus on internal systems or ritualize past practices, without the visionary risk-taking courage of those who've experienced or learned from prior setbacks.

What should Rollins do now?

Rollins is enormously talented. He shouldn't shrink off in defeat or shame to a ski resort--nor should he begin finger-pointing over culpability like HP's Carly Fiorina. It was not the ideal fit, but plenty of firms large and small can use his global systems savvy.

He must immediately rejoin the mainstream of business thought, talk about opportunities, probably avoiding entrepreneurial ones, and prove he can still do what once made him so great and so admired. He should still be a catch for recruiters--in the right industry and company life stage. Bill Perez, after being replaced by Nike founder Phil Knight, is now soaring as CEO of Wrigley's.

In the last five years, which leaders have made the best rebounds?

Jamie Dimon was tossed out of Citibank and brilliantly took some time for reflection, sorting though alternative possibilities, and then came back greater than ever. It's truly one of the most inspirational comeback stories

Then Martha Stewart, of course, is about as dramatic as you can get. She was written off by just about every analyst and almost everyone in media, and here she's back bigger than ever.

People were very sympathetic toward Martha.

The buying public was sympathetic. Not the experts. Not the pundits and the advertisers.

Who has tried to come back and failed?

Where's Carly Fiorina? Even her book is not selling. Last fall, HP had one of the most bizarre and tragic board meltdowns in history with the governance scandal. You would have thought Carly Fiorina would have had a great opportunity to have made it back. She wrote her revenge book, and it didn't help. She had a little flutter of attention, but it didn't help.

What should Robert Nardelli do, now that he's been fired from Home Depot?

He should go into some heavy operational job where the emphasis is on throughput metrics and the customers and investors don't matter that much. If there's a utility, a manufacturer, he's excellent for that. If it requires sensitivity to outside constituencies, he's proven to have a tin ear.

For some of these CEOs, redeeming themselves after a career disaster is just about vanity. For others, it's more important. Andrew Fastow, for example, managed to lighten his jail term by coming clean about his role in Enron's collapse.

And he actually has shown authentic contrition. So you can do really bad things and still ultimately be accepted back into society.

Do you study any celebrity comebacks? What can business leaders learn from, say, the likes of Russell Crowe?

There are incredible comeback stories. When celebrities have gotten themselves in huge problems, it's really been critical to show that their contrition is authentic. Janet Jackson is an example of someone who didn't pull it off well. When they use the "if" word--"if I've done something wrong"--they're not going to make it out of there.

What about Michael Richards?

He missed several golden opportunities. He needed to explain his behavior. Seeing it as anything other than racist was incredibly difficult to do. He's in denial of blatant racism. He still isn't self-critical.

And yet Mel Gibson seems to have done fine.

He used the Twinkie defense. He said he was drunk. At least he was acknowledging a problem.

So maybe Robert Nardelli should just check into rehab.

He should admit that he has a problem. His problem is not greed; his problem is a confidence problem. He never got to be the corporate titan at GE like he wanted. I know him, and I have had conversations with him. It takes only two questions and he's raging angry over the GE situation.

In Pictures: CEOs Who Survived Career Disasters