P&G Ousting Of Potential Shinseki Replacement Rooted In Poor Performance

Shinseki Replacement

Benjamin KrauseLike Shinseki before him, Robert McDonald has faced his own “firing squad” so to speak. Only, McDonald’s firing came at the muzzle end of unhappy shareholders and hedge fund managers at Procter & Gamble (P&G) instead of Congress after hundreds of veterans died.

Just one year ago, McDonald was pushed out of the top spot by investors and outside pressures. Now he stands to inherit a mess within the second largest agency in the United States.

According to critics, prior to his resignation in 2013, McDonald let P&G get too inefficient and bloated with an all too large advertising budget – allegations very similar to those leading to Shinseki’s mandatory resignation. This similarity raises immediate questions of competency in light of severity of VA’s current scandals.

In his resignation letter to P&G, McDonald wrote, “This has been a very difficult decision for me, but I’m convinced it is what is in the best interests of the company and you.” He continued, “During the past year, much attention has been focused on me from several angles, which has been a distraction that is not in our best interests.”

Based on his own words, McDonald essentially admitted that he was not the right leader at the time for his company and that remaining at the helm would cause too much of a distraction.

I have one question. What has McDonald learned in his past year of retirement to successfully and heroically lead an even larger and more troubled organization out of the most scandalous period in agency history?

From what I can tell, the history behind this replacement for Shinseki is beginning to look like veterans have the option picking tails on a double-headed quarter. We will always lose.



McDonald enjoyed a steady, 33-year career while at P&G. Some speculated that this linear experience resulted in McDonald lacking insight from outside P&G that most companies require in a CEO.

Now, President Obama has decided to pick a leader who will transition from one bloated, inefficient organization into another bloated, inefficient organization. Some VSO’s, including American Legion, were shocked at his selection of McDonald.

Is it wise to choose a potential replacement that suffered the same defeat as his predecessor just one year ago? Most thinking people would say, “Hell no.”

The Obama administration has proven embarrassingly incompetent at picking replacements at VA across its executive table, and it shows no sign of stopping.

Dr. Toby Cosgrove withdrew his potential candidacy after it surfaced that his Cleveland Clinic suffered from similar ongoing scandals. Dr. Robert Petzel’s replacement at VHA, Dr. Jeffrey Murawsky, also withdrew his candidacy after scandals surfaced across VISN 12 in connection with the wait list. Dr. Robert Jesse also just resigned after a brief stint as Acting Under Secretary of Health due to linkages to scandals.

So why does President Obama refuse to pick candidates from the top of the barrel when it comes to the lives and wellbeing of veterans?



McDonald was actually replaced by the same man he replaced before, CEO AG Lafley. So like in the movie Rocky V, the former champ came out of retirement to take the helm at P&G – only this time the un-retirement was caused by lagging stock prices.

In 2013, prominent hedge fund manager William A. Ackman was quite critical of what he described as McDonald’s poor prioritization abilities. Ackman argued to fellow shareholders that McDonald was too distracted by outside commitments, including commitments to sit on the board of other corporations. In addition, Ackman believed the company had become too lethargic to compete at optimal levels.

Ackman gave P&G directors until June 2013 to sort out McDonald. By the end of May, McDonald resigned and was replaced by the same man he replaced four years before.



But like Sylvester Stallone in a bad not-so-blockbuster movie (like Rocky V), do not feel too bad when things go bust for people like this at the top. According to Forbes, McDonald earned over $15 million in pay and stock options the same year he resigned.

In all fairness, comparing P&G stock performance under both CEO’s is like comparing two similar apples. Under CEO Lafley, P&G stock increased by 80%. Under CEO McDonald, it rose by 59%. Immediately after delivering his resignation, P&G stock was moved to “buy” from “hold” by USB.

I am sure for most Americans, no one would cry in their beer with either result, but the veteran population should meet McDonald’s nomination with reasoned skepticism.

Read More:

Old Boss Takes Helm Of Procter & Gamble

Press Largely Fails to Note or Downplays How New VA Director Was Forced Out of P&G


Voc Rehab Survival GuideBenjamin Krause is an award winning investigative reporter, Veterans Benefits Law attorney, and disabled veteran of the US Air Force, where he served in its Special Operations Command. He attended Northwestern University and  the University of Minnesota Law School using VA Vocational Rehabilitation.

While in law school, Benjamin won his decade-long fight for full disability benefits and now helps others do the same with this website and his guide, the Voc Rehab Survival Guide for Veterans. Since its first publication in 2011, the guide has helped the veteran community receive millions in untapped benefits through the VA Chapter 31 Vocational Rehabilitation & Employment program. 

Connect with Benjamin on  Google+,  Twitter,  Facebook and LinkedIn.

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  1. Hmm…

    $15,000,000 in bonus money, you say?

    Well, Obama was recently begging American citizens to donate their underwear to the hundreds of thousands of illegal invaders crossing our open southern border.

    If a Pampers diaper costs about .40 cents, then McDonald could of easily bought and donated 37,500,000 pairs of diapers.

    Gee, with almost all of the Border Patrol agents pulled from doing border security and ordered to perform diaper-changing duties, McDonald could easily do his civil duty to help out the illegal invaders by keeping La Raza’s anti-American posteriors snuggly clean.

  2. I’m not so sure McDonald’s performance at Proctor & Gamble can be labeled as a complete failure. A 60% increase in the stock is nothing to frown at. People that don’t get the financial rewards they hope for will always complain and whine.

    What bothers me is the habit of picking former West Point or Annapolis or Air Force Academy graduates. This seems to be a defunct political tradition that has never shown to be a good mix for veterans. In fact, being a graduate from one of the military academies seems to be THE qualifying item on the resume of VA secretaries and the many undersecretaries at VACO. The VA Central Office seems to be the best parking spot for lackluster or tarnished officers from DoD and the Pentagon. This status almost assures that nothing bad DoD does to soldiers before they become full time veterans will ever become a burning torch issue at VA to compensate for the defense department wrongdoing.

    The only thing that will give McDonald a fighting chance and demonstrate his sincerity and commitment to reform is whether he fires the SES crowd at VACO and the VISN and VAMC leadership who all participated in this scandal to fudge statistics to get bonuses. Only time will tell since his confirmation seems to be a shoo-in already. But its not like there are very many choices to fix Shinseki’s gross incompetence and stupidity.


  4. You know, he rose through the ranks at a company that has very little tolerance for low performance. He has proven himself to be an outstanding manager, and he may have picked the wrong strategy as CEO or he may not have been ready for the post. Also, he took the helm during a time that brands like Tide were suffering because the economy tanked and consumers were switching over to store brand products at a lower price. And despite those challenges, you say the stock STILL went up? I would hardly call that a failure. I, for one, am really looking forward to Bob taking the helm of the VA and I welcome him with open arms. I think he may be able to bring some accountability and efficiency to an organization that badly needs it.

    1. You sound like a proctoid, always ready to attack someone for squeezin’ the Charmin.

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