What happened to the Boy Wonder when Batman left Granada

A fight too far for Jack Welch
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The Independent Online

One of the occupational hazards of my job is constantly being called by market research organisations wanting an opinion on all manner of things, which they then resell for unfeasible amounts of money. Occasionally these are good sport as you try and guess who commissioned the survey so you can be sure to make some particularly rude comments about them.

A good half of these include a question about who you most admire as a manager. For nearly a decade the first names on my lips have been Gerry Robinson and Charles Allen, the Batman and Robin of the leisure and media sectors.

This dynamic duo have combined a keen understanding of the price elasticity of their product offer (such as how to get away with charging £1.50 for a cup of tea at Knutsford Services) with a ruthless eye for a deal, a charming disposition and a refreshing attitude to their working life ­ Gerry is rarely found in the office beyond 6pm, and I once tried to call Charles only to find he had decided to have a "thinking day".

But Gerry's retirement to concentrate on saving British culture has left Charles to emerge from his shadow, begging the question if he was a great manager anyway or Trilby to Robinson's Svengali. On last week's showing, it might well be the latter.

Robinson and Allen took over Granada when it was in a mess. The group had been steered into a cul-de-sac by Derek Lewis, then its chief executive (and subsequently the Prison Service boss who did for Michael Howard), and the finance director Graham Wallace (yes, the Graham Wallace now running Cable & Wireless). The company was complex and disparate. The joke was you only discovered that Granada owned something when it closed it down and wrote off millions. Not surprisingly the investors demanded change.

Out went Lewis, Wallace was shunted sideways, and in came the dynamic duo for one of the most successful and exciting corporate turnarounds in recent corporate history. But as Gerry shuffled for the exit, this started to unravel.

The writing was on the wall with the rather ill-executed merger with Compass. Charles wanted the City to take him on trust. They thought he was taking them for granted. The Compass deal, though industrially sensible, has not created value and has brought into focus the fact that Granada's £3.9bn purchase of Forte in 1996 has actually done little for Gerry's and Charles' loyal shareholders.

However, it did allow Granada to demerge its media business at a time when it was spoiling Carlton and United's "Molotov-von Ribbentrop" pact and placing itself at the heart of any potential restructuring of ITV into one company. Again the industrial logic was compelling. Again the execution has been imperfect.

Allen might argue that it is not his fault that advertising was about to fall off a cliff this year. And he can point to similar troubles at Michael Green's Carlton and throughout the media industry ­ as shown by Friday's profit warnings from True North and Interpublic. But a lot of this was predictable and Granada was at fault for allowing overly optimistic forecasts to swim around the City (however convenient they were when pushing through the Granada Media demerger). Granada may also be at fault for not grasping the nettle of what was needed to integrate the former United businesses; it is certainly at fault for not discovering and dealing with the so called "Spanish customs" just revealed at Granada TV.

I always thought that Gerry was the big picture thinker and Charles the master of detail. But since Gerry's departure the detail has bedevilled Granada. Charles needs a partner to help him out.

A fight too far for Jack Welch

Like Muhammad Ali, Jack Welch did not know when to bow out gracefully. The ill-fated attempt by the GE boss to buy Honeywell is horribly reminiscent of Ali's fight too far against Larry Holmes, with the old champion battered within four rounds.

Welch's title fight against Mario Monti is sure to go the distance. Friday's intervention by George Bush, when Dubya jumped the gun and declared the fight over before saying the contest was unfair, has not helped Welch's cause. Monti has said GE can offer further concessions, but like Lloyds TSB's pursuit of Abbey National, the remedies needed to make the deal palatable to the competition authorities are likely to make the prey as attractive as month-old bread.

Welch's determination to go out with a bang is threatening the reputation of what must surely be the world's greatest industrial group. Welch was such a giant he will be a hard act to follow. Lumbering it with a Honeywell shorn of its attractive assets will virtually ensure his successors struggle. But it is hard to fault Monti. The GE/Honeywell deal, as allowed by the US and Canadian regulator, would have so harmed European companies such as Rolls-Royce and Invensys, it was inconceivable the EU could have let it go through. Those Eurosceptics who wonder what they all do in Brussels might put that in their pipe and smoke it.

j.nisse@independent.co.uk

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