Exit through the rift shop

Fadi Chehade ICANN CEO

It came as a big surprise when Fadi Chehade announced that he would be leaving as CEO of ICANN in March 2016, a full 15 months before his contract was due to expire, in order to “move into a new career in the private sector”.

That’s some thanks to a Board that only eight months earlier had extended his contract by two years, along with a healthy 12.5 per cent pay rise. But what’s more troubling is that Chehade’s will be leaving the organization in the lurch, without a CEO at possibly the most crucial time in its history.

When he heads off, in March 2016, ICANN will either just have finished or being about to complete two huge changes: the assumption of the IANA contract, which lends ICANN most of its authority as the domain name system’s overseer; and widespread accountability changes that could change the very structure of the organization and how it makes its decisions.

It’s hard to imagine worse timing: something that the Board itself recognized when it extended Chehade’s contract to last until 30 June 2017. “Taking this action will help ensure the stability in leadership that it is important for ICANN to have, particularly during this time,” read the relevant Board resolution.

What was notable in Chehade’s contract extension however is how it differed from that given to CEO Paul Twomey back in 2006. Back then, Twomey was given a two-year extension with the option of a third year but ICANN spoke of it as three-year contract. Chehade opted just for the two years, even at his elevated pay rate. The sense he was tiring of the job after just two years was expounded recently when ICANN’s chairman Steve Crocker mentioned publicly that he was concerned Chehade would not stay.

Which leads to the question: why? Why did Chehade decide to jump ship before his contract was up? And why did he not hang around long enough to claim the legacy of moving control of the top level of the internet away from the US government?

It’s highly unlikely that Chehade or the ICANN Board will give any clear explanation as to what led to his decision, but there are many pointers along the way. We also asked you, our readers, what you thought about the situation.

Just as important as the question ‘why?’ is ‘what now?’ The new CEO will walk straight into a situation of extraordinary flux. What they decide to do, or not do, will have an enormous impact on both ICANN and the broader internet. So who should it be? And what skills do they need? Again we asked you to provide your thoughts.

But before we get to that, let’s go back to June 2012 and ICANN’s 44th public meeting in Prague where Chehade was first introduced as the organization’s new CEO. Even though Rod Beckstrom was still CEO and Chehade was not due to take over the role for another three months, he was given the stage during the opening ceremony and promptly delivered a barn-storming 20-minute speech.

“I think many of you want to know who am I? Well, I was born to Egyptian parents, grew up in a very French part of Beirut but in the afternoon I became completely Arabic.” He talked of his experience “growing up in a worn-torn country” before telling an extraordinary personal tale. “I was whisked out of Beirut at a very difficult time. My dad found out some of my friends were telling me how to use guns at age 13 so he put me on a boat and shipped me of to Damascus and told me not to come back… I arrived in the United States at 18 – I did not speak English. My first job was to peel onions – I did that for seven months – it was remarkable – try to do that for three days – it’s painful.”

But Chehade learned English, got accepted at Stanford University – with his bills paid for by AT&T – and ended up with jobs at Bell Labs and IBM. This experience, he told his audience, he helped him “grow to learn of the generosity of the world”. And then bringing it back to his audience, he noted: “This is the generosity that I will bring – this community has been nothing but generous to this world. What you have given to this world – the internet – is a wonderful gift.”

The result was a long line of relived and happy looking people leaving the ballroom, glad that ICANN at last seemed to have found its man. But personal tale aside, what Chehade told the audience that day about what he planned to do with ICANN is surprisingly prescient and helps explain his decision to leave the job much sooner that anyone expected.

ICANN CEO Fadi Chehade

Chehade told people what they wanted to hear. Photo: ICANN

Vision outlined

“I am driven by building consensus,” Chehade said. “I love doing this – bringing communities that on the face of it could never be brought together is something that I strive to do – this is what drives me.

“I am all about inclusion. I will listen and include everyone that needs to be in ICANN – this is in my DNA.

“I come from a business mindset. And I will make decisions clearly, deliberately and in a strong approach. I care much more about getting things done than in figuring out who should get the credit.”

Chehade said he did not have a specific strategy right then but that there were “two things that I must bring up today, that are very important. First, ICANN is an international organization and we must strive to make it international. That is not an office in another country, that is not that I speak four languages; being international is understanding how other cultures think, how other people manage and understanding that not everyone has the same access.

“The second thing is that all the things I can say are meaningless if ICANN does not operate with excellence. We can not be expected to do less than the commercial world – we must do five times better, ten times better than the commercial world. It is very important that no one doubts the operational excellence that ICANN is providing everyday.”

Looking back three years later, this manifesto laid the groundwork for Chehade’s successes, his failures and ultimately his decision to leave.

Unlike his four predecessors, Fadi Chehade will be leaving on a high note. Of those we polled – just under 50 people from across the community – 44 per cent of them felt that Chehade had done an “excellent” job. A further 36 per cent that he had done a “good” job: an 80 per cent job approval.

By way of comparison, in a list of the highest rated CEOs in 2014, according to Glassdoor, 50th was Yahoo’s Marissa Mayer with 79 per cent approval. Given the demands of the job and its global community perhaps a more accurate measure would be the job approval rating of the US president, which, over the past 60 years has averaged 54 per cent. Whichever way you look at it, Fadi Chehade has been the most successful CEO of ICANN to date.

A big part of that success may be due to him largely sticking to his vision. His first focus that ICANN “must strive to make itself international” is reflected in the fact that 67 per cent of respondents identified “international understanding” as the biggest positive attribute Chehade has brought to the organization.

Previous CEOs paid lip-service to the idea of ICANN as a global organization but Chehade opened new offices in Turkey and Singapore and made them “hub offices” on a par with the headquarters in Los Angeles. The existing offices in Brussels and Washington DC were more accurately described as “engagement offices” and new ones were opened in Beijing, Geneva, Montevideo and Seoul. New staff were hired around the world from a range of cultures and backgrounds. In many respects, the very strong American culture of ICANN that has dogged the organization for a decade has been tempered.

Likewise, Chehade’s stated goal to make ICANN more professional and ensure that “no one doubts the operational excellence that ICANN is providing everyday” is reflected in the fact that 56 per cent of our respondents say that he has brought “greater professionalism” and 44 per cent that he has “improved operations” at ICANN. Tied with his self-proclaimed “business mindset”, 44 per cent also say that Chehade has brought “business savvy” to the organization.

It is there that the extent of Chehade’s vision starts to tail off however. He promised that he would bring in people that needed to be in ICANN from the outside and that building consensus “is what drives me” but just 31 per cent of people noted as a positive that he had “brought in fresh blood” and just 22 per cent that he had “improved community relations”. In his speech, Chehade made a point of saying that “everything I do will be transparent… super-transparent… is there a bigger word? Extra transparent”. Yet just 20 per cent identify Chehade as having brought “greater openness”.  Of the other positive attributes he brought that you highlighted were: risk taking, energy and out-the-box thinking.

ICANN CEO Fadi Chehade and COO Akram Atallah

With old friend and ICANN COO Akram Atallah in Prague where Chehade was first announced as the new CEO. Both are critcized for hiring old friends and colleagues.

And now the bad news

Of course that leads to criticisms of the man that has led ICANN for three years and will do so for nine more months.

Top of the list, with 70 per cent of you highlighting it was that Chehade “tended to say whatever people wanted to hear”. That tendency is closely connected to the third highest-voted criticism: “Didn’t listen to people’s concerns sufficiently” – something that 46 per cent of you agreed with.

Chehade highlighted his previous experience with bringing disparate parties together as a key qualification for the job but his style of providing different answers to different groups in order to get them closer together did not work well in the unusual ICANN environment. In ICANN, all the very different groups are also on good personal terms with one another thanks to the organization’s small size and its seemingly endless opportunities to socialize three times a year in stunning locations.

A big part of Chehade’s dynamism is his drive to find a solution as soon as possible and move on, and to do that he has a tendency to sympathize with whatever group he is currently talking to. At times this caused mild irritation but over time it started to diminish trust. Occasionally it did much worse damage, such as when he told a panel in the French Senate that ICANN’s new European office could lead to moving ICANN’s headquarters outside the United States; only to say the exact opposite when in Washington DC just a few weeks later.

Chehade finds the job enormously frustrating. “I will make decisions clearly, deliberately and in a strong approach,” he told the ICANN community at the very start. “I care much more about getting things done than in figuring out who should get the credit.”

Except ICANN is not a typical CEO-led organization; it comprises many different groups that often prefer no change to change they are unsure about. The result is an infuriating tendency to stop progress of any sort until everyone feels they have been adequately consulted, and that same culture is reflected inside the organization. At one meeting, Chehade joked that he couldn’t even change the brand of coffee in ICANN’s break room with getting approval from the Board. Of course, many a truth lie in jest.

This frustration led directly to all of the other main criticisms of his time in power: 43 per cent of you said he tried to move too quickly; 41 per cent that he tried to do too much; 34 per cent that he didn’t try to fix organizational problems; and a striking 57 per cent said that he hired too many old friends and colleagues into roles at the organization.

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It’s not what you know

That last part was particularly problematic, if understandable. Frustrated at the internal culture of meetings over movement and papers over progress, Chehade and COO Akram Atallah – who are old friends – brought in more and more of their own people in an effort to shift the culture. Not all of them were best suited or qualified, but real frustration developed when jobs were filled without the job even being posted internally.

Nora Abusitta-Ouri, a former classmate of Chehade’s, became vice president of public responsibility programs. Former neighbor Susanna Bennett became Chief Operating Officer. Former co-worker Chris Gift became vice president of online community services. Former co-worker Allen Grogan became chief contracting counsel and then when that job finished, chief contract compliance officer.

Neighbor of Atallah, Elizabeth Hoover became HR manager. Former co-worker Cyrus Namazi became vice president of industry engagement. Old friend Ashwin Rangan became chief innovation and information officer. The wife of a former co-worker, Maguy Serad, became vice president of contractual compliance. Another former neighbor, Christine Willett, became vice president of gTLD operations.

In all, only one member of the C-suite hired since Chehade came on board has not been a friend or former co-worker – and that was ICANN’s former CTO David Conrad hired back into his old position. Every new vice president based in the Los Angeles headquarters has been a friend or former co-worker.

Frustrated with the community intransigence, Chehade hired from within the community to deal with the community, while his group in Los Angeles became increasingly separated from the broader organization and began to think of themselves as almost a separate company.

Fame and vainglory

But in order to understand why Chehade is moving on, it’s necessary to look at what happened after former NSA contractor Edward Snowden revealed the depth of US government spying over the internet.

As IANA operator, ICANN was immediately pulled into the global political arena. Chehade saw an opportunity and took it. Within three months, he was meeting with Brazil’s president Dilma Rousseff and from that meeting the idea of an international conference grew and was settled. Just one month before the NetMundial conference, the US government announced it would hand over control of the IANA contract and that ICANN would be in charge of running the process. Suddenly, the world’s attention was on Chehade.

From 1 July 2013 to 1 July 2014, he managed to rack up travel costs of $363,000 – more than $30,000 a month. The impact was significant: to many, Chehade appeared increasingly aloof, even disparaging toward the ICANN community. As he flew around the world in an endless series of meetings with top officials, he started talking about his role in a way that led even seasoned diplomats to call him “the Pope of the internet”.

Somewhere along the way, Chehade decided he needed to extend the NetMundial conference into a permanent body that would help tackle broader internet governance. The NetMundial Initiative (NMI) was born and Chehade invested enormous amounts of personal capital into the project, teaming up with the Brazilian government and the World Economic Forum and redirecting ICANN’s resources to make it happen.

But the project was a disaster from day one. The internet community was skeptical of the inclusion of the World Economic Forum and the creation of “permanent seats” for Chehade and his new friends was distinctly un-internety. The community turned on the project and by extension on Chehade.

Meanwhile frustration with the slow pace of the IANA transition process led him to make disparaging remarks about a number of well-respected members of the internet community. When a video of the remarks was posted, he was forced to personally apologize. But by then the damage was done.

And then the man who said “all the things I could say are meaningless if ICANN does not operate with excellence” was forced to deal with the fact that five of its systems – one of them storing confidential financial details of many of the world’s largest companies – had been compromised, thanks to amateurish software installation and sloppy security practices.

Amid all this Chehade was offered a job, a way out, “in the private sector (outside the domain name industry)” according to the official announcement. He said he would announce further details at the end of the year. Most expect it to be a company closely aligned with the World Economic Forum, around which Chehade has spent much of his time recently.

For Chehade it will mean the ability to take a vision and move forward on it. Faced with the alternative of dragging an unwilling organization and ungrateful community toward an unimpressive goal, it will be like a vacation.


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What you told us: Poll results

46 people responded to our online survey from staff/Board to contracted & non-contracted parties.

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