View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Technology
July 7, 1997updated 05 Sep 2016 12:36pm


By CBR Staff Writer

A temporary chief executive has been appointed in charge of Andersen Worldwide, the international accountants and consultancy group which is wracked by a power struggle between two factions. W Robert Grafton, chairman of the board of partners, becomes acting boss in a compromise appointment by the board, designed to buy it time to resolve a deep-seated dispute which is threatening to split the whole organization in two. The battle is between the information technology specialists at Andersen Consulting and the accountants at Arthur Andersen & Co. They have been at each others’ throats over the split of money from consultancy fees and the fact that they increasingly find themselves fighting for the same business. With a 100,000-strong worldwide workforce and a turnover of $9.5bn there is a lot at stake in the Andersen acrimony. As Andersen is the type of organization that companies in trouble turn to when they are beset by problems, the fact that it cannot resolve its own difficulties has raised eyebrows. However, Andersen has a problem that most companies do not face – a democratic structure. Top appointments need to be approved by a two-thirds majority of the 2,700 partners, scattered across 79 countries. And the Andersen Consultancy partners were outraged when earlier this year the board nominated Jim Wadia from Arthur Andersen to take over from present chief executive Lawrence Weinbach when he retires next month. Andersen Consultancy has been the fastest growing part of the organization and the 1,000 Consultancy partners now bring in more revenue than the 1,700 partners on the accountancy side. They managed to block Wadia’s appointment and were rewarded when the board turned to George Shaheen, managing partner at Andersen Consultancy as its nomination. To boost their candidate, Consultancy partners bombarded the accountancy partners with e-mail, extolling Shaheen’s virtues. The accountants only glowered at their computer screens and voted in force to block Shaheen’s appointment. What they feared was reports that Shaheen wanted to overhaul an income sharing scheme under which Arthur Andersen partners are subsidized to the tune of around $100m a year by the Consultancy side. Now the board has to find a way to heal the divisions. After appointing a temporary chief executive, it set up a high level group to examine key organizational issues and report back by next spring. Only when the serious problems dividing it have been resolved, will there be any hope of electing a permanent new chief executive.

Content from our partners
Unlocking growth through hybrid cloud: 5 key takeaways
How businesses can safeguard themselves on the cyber frontline
How hackers’ tactics are evolving in an increasingly complex landscape

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.