P&G Veteran McDonald Picked To Clean Up The VA

Bob McDonald, the West Point graduate whose 33-year career at Procter& Gamble culminated in a contentious reign as CEO for nearly four years, will be nominated by President Barack Obama to run the embattled Department of Veterans Affairs today, according to sources within the White House.

“The unorthodox pick of a retired corporate executive whose former company makes iconic household products such as Tide detergent and Charmin toilet paper — rather than a former military general — underscores the serious management problems facing the agency charged with serving more than eight million veterans a year,” writes the Washington Post’s Juliet Eilperin, who broke the story yesterday. 



But McDonald is not a stranger to the armed forces. After graduating in 1975 in the top 2% of his class at the military academy, he served as a captain for five years, primarily in the 82nd Airborne Division, and received the Meritorious Service Medal. He is also a life member of the U.S. Army Ranger Association, Navy Timesreports, and the 75th Ranger Regiment Association. His father served in the Army Air Corps in World War II.

“Bob is an immensely gifted and caring individual. That was evident to me when we first met as cadets at West Point, over 40 years ago," retired Major General James "Spider" Marks said in a statement reported by Reuters’ Steve Holland. "He came from a military family, and knows the challenges from living them.”

The VA, as has been widely reported, is embroiled in “controversy, as CNN first reported,” reports CNN’s Cassie Spodak, “[involving] delayed care with potentially fatal consequences in possibly dozens of cases. Eric Shinseki stepped down as head of the department in May after Republicans, Democrats and veterans' advocacy groups joined together in calling for his resignation.”

A report released by the White House Friday called for an “overhaul” of the “corrosive culture” at the VA, finding that the agency “currently acts with little transparency or accountability” and that its leadership structure is marked by “a lack of responsiveness and an inability to effectively manage or communicate to employees or veterans,” reports Lesley Clark of the McClatchy Washington Bureau.

McDonald’s own leadership of nearly four years at P&G “ended in May 2013 with investors voicing frustration with the company’s sluggish performance under his leadership,” report the Financial Times’ Richard McGregor and Barney Jopson, as its “sales growth and profitability began to sag, some of its brands became stale, and it began to commit management errors that led to delayed product launches and recalls.”

McDonald faced particular pressure from activist investor William Ackman, who “loudly agitated for the CEO's ouster,” as the Cincinnati Enquirer’s Josh Pichler recalls. “P&G's board solidly backed McDonald, but he eventually decided the distractions were impacting the company and retired — despite the fact that the company's stock rose 21% during his last 10 months at the helm, and 54% during his time as CEO,” Pichler writes.

"The character of a leader is putting the needs of the organization above himself," McDonald said is a 2013 interview with Pichler. “And that's what I tried to be about."

“The choice suggests a real focus on customer satisfaction, as opposed to what you might get from a retired general or medical leader,” Phillip Carter, who follows veterans’ issues for the Center for a New American Security, tells the Washington Post’s Eilperin. 

McDonald is a “very strong manager who came up through the ranks with an outstanding track record of dealing with challenges and delivering results,” said American Express CEO Ken Chenault, who was on P&G’s board during McDonald’s tenure, reported the Christian Science Monitor’s Brand Knickerbocker. “He stays on top of the details.”

Jim McNerney, chairman and CEO of Boeing who also served on P&G’s board, called McDonald an “outstanding choice for this critically important position,” the AP reports.

“This was a brilliant appointment by the president," John Pepper, another former P&G chairman and CEO and a Navy veteran, tells the Cincinnati Enquirer’s Mark Wert and Sharon Coolidge. “His commitment to the military is deep and visceral.”

Bob Wallace, executive director of the Veterans of Foreign Wars, said McDonald “comes with the credentials they need at this time: management expertise and someone who has made a living making tough decisions,” report Colleen McCain Nelson and Ben Kesling in the Wall Street Journal.

“His branding background may prove helpful, because there are few organizations in America with a worse reputation with its customers than the VA right now,” said Paul Rieckhoff, founder and CEO of the Iraq and Afghanistan Veterans of America in a press release.

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