Page 141 - MS Year in Review 2020

Evaluation of the Leadership Initiatives

The leadership process of dealing with the Channel Ten crisis led by Frank Lowy was
designed to overcome a business failure and near-death experience. It was,

however, a successful extrication from that business failure. As such, it provides an
excellent model of how to handle a crisis brought about by a company’s desire to

grow through diversification. In addition, Westfield needs to be acknowledged for
learning from a mistake and actually using these lessons to improve/enhance the
company’s future effectiveness.

Epilogue

In 2017 when Unibail-Rodamco acquired the Westfield Group for $16 billion, it
marked the end of the long journey that had begun with company’s inception in

1960.

Our best guess about the rationale underlying this decision is that Frank Lowey,
who understood the Mall business very well, could clearly see the threat of “on-line

shopping” coming, and decided to “cash in some of his chips.” Although we do not
know the details of the agreement, we do know that the Lowey family retained a
“substantial” interest in Unibail-Rodamco, and very likely also used the deal to

diversify and protect its core assets. The deal seems to be a well-conceived
“endgame” for Lowey and his family as well as Westfield’s other shareholders.

THE BOTTOM LINE IMPLICATION FOR TESLA,

ZOOM, ET. AL.

Although Tesla, Zoom, and several other recent companies have achieved dazzling
initial success, as the experience of Westfields shows, initial success is not a
guarantee of continued future success. Failure to do what is necessary to manage

an organization effectively is likely to lead to the Icarus Syndrome.

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