AKERS, LEGO, STEMPEL: IT'S A NEW WORLD OUT THERE IN AMERICAN BUSINESS

Who got the ax today? Pick up the morning paper and find out the next corporate corpse. CEOs are being ousted at the fastest rate in U.S. history. Last week, John Akers of IBM and Paul Lego of Westinghouse went down. A couple of months ago, Robert Stempel of GM was ousted and before that Kenneth Olson of Digital Equipment bit the dust. James Robinson of American Express did barely escape with his neck but had to precipitate a bloodletting on his board of directors to do so.

Time was when the CEO packed his board with through-thick-and-thin friends who would rubber stamp his decisions and continue him in office until his retirement date arrived. The outgoing CEO would pick up his successor who would ultimately put his thick-and-thinners neatly in place. American ingenuity and marketing ruled domestic and foreign markets. Economic dominance assured financial success. Corporate business culture was unvarying and eternal.

Everything has changed. The nature of international competition has changed. The nature of American business has changed or it should have.

Each of the troubled grants had its set of reasons for decline. GM was bloated and made cars that people did not want to buy. IBM stood rock solid with its affection for the mainframe and watched the personal computer parade march by. Westinghouse went in the real estate business and paid high prices for the wrong junk bonds. Whatever the precise reason with each corporation, the stock prices headed south and CEOs were under siege by the powerful institutional investors.

Just as powerful lobbies influence decision-making in Washington, so too do powerful investor lobbies influence decisions in corporate America. Institutional investors, which hold huge hunks of the company's stock, are not happy when prices plummet and dividends are slashed. In the old days, when stock prices declined, pension funds would sell. Today, it isn't so easy to bail out with holdings of incredible magnitude. So, when stock prices head south, the institutional investors start griping to the board of directors. Corporate revolutions can begin in the somber world of pension management.

Today's director, although beholden to "him who brung me," isn't happy to have his or her reputation tarnished by being part of an IBM Titanic. A point is reached when a change becomes inevitable. Heads have to roll.

Finally, there is the corporate culture. Any goliath business organization has one. IBM and GM most certainly do. Corporate thought evolves in an established and traditional pattern. Even if the top executives see trouble ahead, they cannot necessarily turn the ship around at the second or third level of management. No one can tell veteran GM engineers how to make cars. They have made `em for the better part of a century and they are going to continue to make `em basically the same way. No one can tell veteran IBM computer experts how to make computers. They have made `em for decades and they are going to make `em basically the same way. The culture of past success is the impediment to change.

In every respect, it's a different competitive world. John Akers, Robert Stempel, and Paul Lego know it better than most.