Beth Kowitt: Cracker Barrel's CEO ouster surprised Wall Street but not women
Published in Op Eds
It seemed like Julie Felss Masino had saved her job as chief executive officer of Cracker Barrel Old Country Store Inc.
After a logo change ensnared the restaurant chain in the culture wars, Masino had the company back on track. The stock has more than doubled year-to-date, making Cracker Barrel the S&P Composite 1500 Restaurants Index’s best performer. In June, the company reported a surprise profit for the quarter and raised its forecasts for the year. One month later, Masino is out.
The decision sent the shares down more than 2% and left some analysts scratching their heads. But women who have sat in the corner office know better.
Boards are moving much faster to fire the big boss when things go bad, based on the past few years of CEO turnover rates. The phenomenon is even more acute for female CEOs, who have always been under more intense scrutiny than their male counterparts.
Over the past decade, women CEOs of Russell 3000 companies left after an average tenure of 6.2 years versus 8.9 years for men, according to Exechange, which tracks executive changes. In examining the reasons for CEO departures over the same period, the research firm found that women were more likely than men to be forced out.
Masino’s tenure at Cracker Barrel is a textbook example of how we’ve ended up with these statistics. She had no choice but to modernize the brand, as the company faced off against flagging restaurant traffic and an aging customer base. In the backdrop, an activist investor circled — a challenge female CEOs are 50% more likely to have to navigate than male CEOs.
It was, in many ways, the classic glass cliff scenario. Indeed, women often only get a shot at being a CEO when a company is in crisis or turnaround mode — effectively when the role is such a minefield that a male candidate doesn’t want to touch it. So why do women agree to take on these impossible jobs? Maybe because with a paltry 11% of Fortune 500 enterprises led by female CEOs, women know it may very well be their only chance to run a company.
Masino, a veteran executive of Taco Bell, spent less than three years in the top job at Cracker Barrel. Some of her moves, like refreshing the restaurants and the menu, were working. But she set off a firestorm in August with a redesign that removed the barrel and the man known as the “Old Timer” from the company’s famously folksy logo. Online critics blasted the change as an assault on the southern heritage that the band embodied, calling it “woke.” It turned out that much of the online uproar was perpetuated by bots.
That these changes to an old-school brand were being implemented by a woman likely amped up the vitriol. Masino was personally targeted, her appearance mocked. The company upped security on its corporate campus. (As part of her separation agreement, Masino will continue to receive protective services from the company.)
This may be when the company started to look for a new CEO. But it’s likely it wasn’t until until Masino’s course correction took hold that the company secured her replacement. As Bloomberg Intelligence analyst Michael Halen wrote, new CEO David Deno is “set up for success in his first year.”
Halen notes that the company has opted for “experience” in hiring the 69-year-old Deno, who previously spent five years at the helm of Outback Steakhouse parent Bloomin’ Brands Inc. But it might not be the kind of track record Cracker Barrel is looking for: The stock price declined more than 15% on his watch. If he has a repeat performance at Cracker Barrel, at least he can count on it being his predecessor who gets blamed.
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This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Beth Kowitt is a Bloomberg Opinion columnist covering corporate America. She was previously a senior writer and editor at Fortune Magazine.
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