Turnaround time again

Al Angrisani’s book is called Win One for the Shareholders. In it he writes: “I am frequently criticised for my strict – almost religious – adherence to the belief that the board, management team and employees all work for the shareholders and that the shareholders must make money on their risk capital before we share in the fruits of our labour.”

Such sentiments are likely to appeal very strongly to the shareholders of Harris Interactive, who have seen the value of their stock plummet from the heights of $8 a share when Angrisani last worked for the company – as president and chief operating officer in 2004 – to just $0.70 (at the time of writing).

Brought back in to the company as interim CEO last month, Angrisani became its fourth leader in six years and the third to be given the apparently difficult job of returning the business to proper levels of performance.

This whole sorry tale begins during Robert Knapp’s tenure. He became CEO in 2004, replacing company founder Gordon Black – a man who, to quote Mori founder Bob Worcester, “bet the store on online polling and built an enviable and very successful business on it”. Many thought Black’s job was destined to go to Angrisani, and perhaps it should have. Knapp was forced out in 2005 after two consecutive quarters of falling earnings.

Greg Novak was next to take the reins, with ambitions to build a “billion-dollar” international business. He never achieved his goal, being ousted in 2008 for results that were “less than expected”. His successor Kimberly Till, promising a turnaround built on innovation and a “considered approach to expansion”, met a similar fate.

So will Angrisani succeed where the others haven’t? Or perhaps it’s more appropriate to ask: what now constitutes success? After six years of failed attempts to scale up the business, might shareholders just be looking to cash out with a quick sale once the share price hits $2 or $3? Angrisani’s employment agreement with Harris is to serve as interim CEO for a period of one year, becoming CEO after that only by mutual agreement. That could be read in two ways: either the company is hoping to get everything done that needs to be done in that first year – which, unless it’s a sale, seems optimistic – or Angrisani wants to make sure the board is committed to seeing through his turnaround plan.

Angrisani’s two successful turnarounds – Total Research and Greenfield Online – each took three years and he may well intend to spend the same amount of time repairing Harris. But both those turnarounds ended in a sale: Total was sold to Harris and Greenfield to Toluna (via Microsoft).

So a sale may well be Harris’ ultimate fate – whether after one year or three – and perhaps it’s for the best. Selling to a bigger rival would be the surest way to take what’s good about the company and scale it up. Novak and Till’s international plans for Harris were not driven by ego but because they realised the tricky position Harris found itself in, and in which it remains.

It was Novak who once observed that the company was “stuck somewhere between being a successful US firm and a real global player”. Or, as one ex-employee recently put it, the company is too big to compete profitably for the small projects and too small to compete successfully for the big – often international – tasks. It recently lost some major long-term tracking contracts for Nokia, BP and Microsoft.

Harris still carries a strong brand, thanks in part to its well-known and widely referenced public opinion survey, the Harris Poll. And the innovative spirit that drove Gordon Black to embrace online research methods remains evident in recently developed offerings like Lifestreaming, which asks a panel of consumers to let the company monitor their social media activities. Nor does it lack “disciplined, hard-working people”, says one who used to work there.

Angrisani has yet to give a verdict in public on the company or its prospects – a request from Research for an interview was declined and emailed questions went unanswered – but if his book is any guide, he’ll be sure that Harris has the potential to succeed. He likes to work with “troubled and underperforming companies”, he writes, “companies that have lost their way on the corporate highway but can still find their way back onto the right road”.

Correcting its course will no doubt involve some “rightsizing” – to use Angrisani’s preferred term for aligning corporate costs to revenues. It’s possible further job cuts may have to be made, even after the fairly sizeable headcount reductions made by Till during her period in charge. But, say observers, Angrisani will be careful to trim only where necessary. He recognises that successful turnarounds are about more than just cost-cutting, so he’s likely to take careful steps on investing after the rightsizing is completed, says Nicolas Metzke, who witnessed Angrisani’s turnaround strategy first-hand while working for Ciao, the European arm of Greenfield Online. He’s now co-founder and CEO of Hypeed and Mosaic Lab.

At Greenfield Angrisani pushed technology and automation to get profits ups, says Metzke, though such a strategy might be better suited to an online data collection firm than a full-service custom research agency like Harris.

Metzke recalls Angrisani being a “fair man” who was upfront and open about his plans for the company and would always “look to build consensus first among managers” on the decisions that had to be taken.

But make no mistake, Metzke says: “His only real concern is to maximise shareholder value.” That unrelenting focus was “not always easy” to deal with, Metzke admits – he says he sometimes worried that decisions that were taken were more for short-term gains and “didn’t seem to make a lot of sense in the long run”. But he says unequivocally that Angrisani is “the right guy to get the share price up”.

At Greenfield Online, Angrisani took the share price from $6.20 to $17.50. Can he do the same at Harris?

Metzke says: “He is a good strategist, but he needs a team around him to implement that strategy. What he needs at Harris is somebody in charge of innovation, research and development, product development. He needs a good sales guy, an operations guy, a technology guy – then he can do it.”