Commentary: Olympic Gold for Management Dysfunction

Is there a way to incorporate back-biting and trash-talking into an Olympic sport open to participants of both genders, all ages, and every position of power--including, say, a former Maytag Corp. (MYG ) CEO? (Oops, we left out ruthless rumor-mongering.)

If there is, we've got gold medalists-in-waiting out there in Colorado Springs. Ladies and gentlemen, say hello to the world champs of churlish behavior and management dysfunction--the U.S. Olympic Committee.

That might be funny if we weren't watching the apparent implosion of the organization we trust to nurture our Olympic heroes by building a fire in their bellies and guiding their training. Instead, the USOC has become a soap opera of questionable ethics, personality clashes, dramatic resignations, and résumé fudging.

Lloyd Ward, the fourth USOC chief executive since May, 2000, is the latest official in the hot seat. He's accused of using his influence to help a company that employs his brother, Rubert, go after an energy contract for the 2003 Pan American Games in the Dominican Republic.

In the politically charged USOC, which has long pitted a cadre of powerful volunteers against the managers hired to run the place, getting even is as important as getting to the bottom of things. So now, Ward's accusers have become the accused. On Jan. 20, five USOC vice-presidents called for the resignation of USOC President Marty Mankamyer, alleging that the 69-year-old grandmother, a volunteer, was using the ethics flap to force Ward out.

Whether Ward is victim or another ethically-challenged CEO isn't clear now and may never be, even when an independent investigation reports on his role in about two months. By then, permanent damage to the USOC may be already done. "We're always asking athletes to do the right thing for the right reason," says Brian Derwin, a former Olympic weightlifter who resigned from the USOC on Jan. 16 to protest an internal report that found Ward had not violated ethics rules. "But here, it's like: `It's a rules violation, but we can maneuver out of it."'

Corporate sponsors, who pump millions into USOC coffers either directly or as global sponsors of the Olympics, are getting scandal fatigue. Although none has bailed yet, the danger of defections is evident in a Jan. 20 letter to Ward and Mankamyer from David F. D'Alessandro, chairman of John Hancock Financial Services Inc., one of 10 global sponsors. In it he fumes: "We are concerned that the endless missteps...[are] damaging the Olympic brand and, by association, our own image, and diluting the return on our Olympic investment."

One reason sponsor patience is wearing so thin is that the number of troubled USOC leaders in recent years is larger than the Olympic delegations of some Caribbean nations. Ward's predecessor, Norm Blake, came in like a turnaround torrent, clashed with volunteer leaders, and was gone in nine months. Volunteer Sandy Baldwin, who ushered Blake in--and then out--had to resign as president after it was discovered that she had inflated her résumé.

D'Alessandro, who figures $25 million in Hancock money has filtered down to the USOC in the past nine years, says the management structure--too many volunteers trying to run the show--is a big part of the personnel messes. "Norm Blake was not without talent," he says. "Neither is Lloyd Ward. It's a funny place. The moment they make you captain of the ship, you walk on board, and you might as well keep walking because they have a plank for you on the other side. You're in the water before you know it."

It's not just sponsors and athletes who should be concerned about the disarray at the USOC, however. With a Europe-dominated International Olympic Committee still smarting from the Salt Lake City scandal, this could be just the excuse the Lords of the Rings need to deny New York's bid for the Summer Games in 2012.

By Mark Hyman

With Jay Weiner

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