Online Extra: "You Just Build Up Your Confidence"

Quest Diagnostics CEO-in-waiting Surya Mohapatra discusses how the five-year grooming process has helped him enter the big leagues

For five years, Surya N. Mohapatra has been waiting in the wings. But on May 4, he'll get his moment in the spotlight when he officially becomes CEO of Quest Diagnostics (DGX ), a $4.7 billion medical-testing company, at its annual shareholder meeting.

He might be the best-groomed heir apparent in corporate history. Since joining Quest in 1999, Mohapatra has been under the steady guidance of outgoing CEO Kenneth W. Freeman. It's Freeman's belief that Mohapatra is ideally suited to the task of running Quest. After tripling its revenues through acquisitions in five years, the outfit is entering a period of organic growth that will depend on exploiting advances in science and medicine to develop new tests and conquer new markets. Freeman is sure Mohapatra, with 25 years in health care and a deep knowledge of cardiovascular research and diagnostic-imaging techniques, is the man for the job.

Mohapatra sat down with BusinessWeek Management Editor Louis Lavelle at a Quest facility in Lyndhurst, N.J., on Apr. 19 to discuss what it's like being groomed for the big leagues. Following are edited excerpts of their conversation:

Q: Do you feel more ready now than you did when the grooming process started?

A:

This is an interesting transition. You join a company with an ambition that one day you'll have an opportunity to run it your way and experiment with your ideas. It's a very deliberate process, and every day, at least for me, I learn. Am I more ready now than I was four years ago? Absolutely.

Q: Was it difficult to break some of your old habits?

A:

It's very difficult to change people's habits. I come from a background of facts and data. If I have nothing to say, I don't say it. I remember Mike Szmidt, the HR person, saying, Surya, let me tell you: Jim Chambers [former president of business services] and Ken Freeman and other people would really like to know what you're thinking -- and this was only two weeks into my job. There's a tremendous need in the company to be really verbose. This was very hard for me.

Q: Your relations with the board were a matter of concern to Freeman, who felt you deferred to him during meetings when you should be expressing your own opinions. Is that true?

A:

You come to the company as the president and COO, and your boss is one year younger than you. You want to be the CEO, but you don't want to tread on his toes. I didn't want to do something that would look like I'm anxious. It was different in the third year, and it was very different in the fourth year. You just build up your confidence.

Q: When Freeman steps down as CEO on May 4, he'll remain as chairman for up to one year -- a practice that governance experts say can lead to power struggles. Are you concerned that Freeman will be second-guessing you?

A:

Unless he changes personality immediately, there's no concern. I know him, and he knows me. We're very open. His job as chairman will be to do the board-effectiveness [evaluation] and any other thing I ask him for help on, but he's not leading the company. He's my third opinion.

Q: Five years is a long time to be groomed for a job you had no guarantee of getting. Did you ever have second thoughts?

A:

It's very unusual for somebody to come in as president and COO and wait for five years. If it doesn't happen in three years, people go somewhere else. I stayed here because I think there's tremendous opportunity in this company.

I remember the first week I was here someone asked, "What's your vision?" I said the only reason I got hypnotized to come here is maybe we can do $5 billion [in revenues] in five years. We're very fortunate that we're going to do this.

Q: That's a mixed blessing, isn't it? Will you be able to maintain that kind of growth without frequent acquisitions?

A:

We're now entering the third chapter in the Quest Diagnostics story. The first chapter is the turnaround. The second chapter is truly becoming the industry leader by acquiring SmithKline Beecham Clinical Laboratories. And the third chapter is growth from within.

The most important challenge for me and my management group is to unleash the power of Quest's 37,000 employees and think about growth. We're preparing the company to grow, and we're gaining some ground.

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