Carly, Out! Meg, Out! Now Diane Greene, Out!

In what seems like one of the more shocking, bizarre management moves in recent tech history, red-hot software companyVMware (VMW) pushed out CEO Diane Greene. She not only built the company with her husband and co-founder, Mendel Rosenblum, but in the absence of a Carly Fiorina or Meg Whitman, Greene had become one of the most visible, successful women in technology. The company was the most successful tech IPO of 2007, has about 85% of the market in what's called virtualization software (bottom line: it saves anyone operating a roomfuls of servers a ton of money), and actually worries Microsoft (MSFT). Employees love her. Over at Glassdoor.com, Greene has one of the highest internal approval ratings of any tech CEO, at 84%.

So what happened? Well, I've talked to Diane on a number of occasions, and while she was a brilliant entrepreneur, she didn't always seem politically smooth. In 2004, with VMware on the ascent, Greene sold the company to tech hardware giant EMC (EMC), and immediately regretted it. She seemed to always feel a bit duped -- thinking that VMware could've waited a year, gone public and had a major payday for her and the company's employees. She fought to keep Silicon Valley's VMware separate from Boston-area's EMC -- which VMware employees very much appreciated. She allegedly fought with EMC CEO Joe Tucci about strategy and things like VMware's willingness to package its software with systems that would compete with EMC.

It also seems that Greene is better at running a hold-onto-your-hats start-up vs. an emerging giant. VMware has been so successful, it has drawn stronger and stronger competition -- including Microsoft. EMC's criticism of Greene rests in part on her inability to put the hammer on emerging competitors while branching VMware into new roles and businesses.

Still, this is a wild turn of events. Greene has been held high as a new breed of women tech CEO -- steeped in technology and entrepreneurship. (Fiorina and Whitman were more professional managers and marketers.)

VMware is going to be run by Paul Maritz, who worked for 14 years at Microsoft and was known, in fact, for his brutally competititve tactics. Maritz became an EMC exec when EMC bought Maritz's company, Pi. VMware shares promptly dropped 50% on Tuesday.

Comments

[deaverb]

Same for women as for men. As Peter Drucker says, "The charisma entrepreneur is overrated and often a danger." Many of the legends only became so AFTER they had built their companies brick by brick: Sam at Walmart; Ray at McDonalds; Joe Wilson at Xerox.

Hurd, at HP said famously, "At NCR we moved iron." Sales. Not charisma.