Another example is the iPod, which was the core of the Apple turnaround, was supposed to go to S3, but they’d gone bankrupt. Had Steve Jobs not seen the opportunity, Apple likely would have failed as well. Instead, even though this was far from Apple’s core business at the time and he had killed every iPod-like program in the company, Jobs took the leap. Had he not, someone else would have had the iPod and Apple would have never gotten to the iPhone or iPad. So good luck is generally a combination of opportunity, insight and execution.
I put this last because I’ve seen successful CEOs, like Louis Gerstner, who were able to figure out how to use their other skills to make knowledge less valuable. This isn’t to say a CEO shouldn’t know their industry and products or that if they are good at getting knowledgeable people around them they don’t need this initially. Steve Jobs played at being an engineer, Bill Gates also dropped out of college, and currently it is common advice to suggest someone wanting to build a company do that rather than actually go to college. You can successfully learn on the job but, I will say, and most of the CEO failures I’ve seen to date support this that if a new CEO doesn’t have or quickly get industry and product knowledge, he is likely to make a whole bunch of avoidable mistakes, so being able and willing to close this gap is incredibly important. But I also know a CEO can be wrapped with knowledgeable competent staff and the entire team can perform more than adequately.
However, this is kind of a chicken-and-egg issue in that if the CEO doesn’t have the requisite knowledge then they likely don’t know how to properly choose a staff. This is why it is critical that the board take action to surround the inexperienced CEO with an experienced staff. This was core to the IBM turnaround. Gerstner was largely successful because he was partnered with both the leading financial turnaround expert at IBM’s scale in the world, Jerry York (the man was a legend), and wrapped with IBM executives that helped build the industry. The CEO that currently seems to be the smartest in the industry is Elon Musk, though even he has self-imposed blind spots.
Marissa Mayer was set up for failure
There is nothing to indicate that Mayer is very crafty. This was apparent when she was passed over at Google -- the crafty executive just doesn’t get publically passed over. She wouldn’t have the job at Yahoo or the job at Google if she didn’t have charisma, but she hasn’t learned to leverage it and like her Google peers, doesn’t understand how to use marketing as a force multiplier. As a result most of the folks who need to understand her vision don’t appear to.