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But he agreed to serve on the Magellan's board. He also agreed to attend the company's first-ever strategic-planning session later that year, in mid-September, when 10 of the 70 Magellan's employees would journey 40 miles north for an off-site meeting in the wine country around Zaca Lake. There, Manning detected something new.

"I saw a management team starting to come together," he says. "There was a nucleus of management potential. I saw hard-core evidence that John and Gloria were serious" about their intentions to change how they headed the company. But Manning also saw hard-core evidence that his friends were on the edge of a physical breakdown. "I saw the exhaustion on their faces."

And the frustration. The strategic-planning session, organized by Wilmer, was like so many others in corporate America. An outside facilitator presided while members of each department talked about what they'd need to reach this or that goal. "But what about my and Gloria's needs?" McManus shouted inside. "This is so shallow!"

Suddenly, there on the lake, McManus grasped what Goodman had been trying to tell him back in July. Strategic planning is just an exercise in number crunching, and pretty futile at that, if you haven't considered what you need and want first. Several of the managers at Magellan's seemed to grasp as much--at the top of their list of departmental goals they'd scribbled, "Time for John and Gloria." But McManus knew there was more to it than that. And he knew what he wanted. He wanted a peer who could run Magellan's professionally, someone he could learn from, someone he and Gloria could trust--a real COO; maybe almost a CEO. He wanted Manning.

Not that he said so immediately. When the sale of the company Manning was running finally closed, on December 1, 1997, he and McManus talked casually. "Hey, congratulations," McManus said. "Yeah," said Manning, "it's finally done." Still, no offers were made. The idea of starting "formal talks" seemed silly to these old friends. They spoke a few more times before either popped the question: "So, are you interested?" "So, do you still want me out there?"

They actively debated whether a COO--or any one person--should run a company. By then McManus was harboring serious doubts about the wisdom of simply handing over certain functions to an operations chief, despite the "early tip-off" he had gotten from reading Corporate Lifecycles. "The administrator Adizes writes about," McManus says, "stops far short of what you need." Manning, who is 49, reflects on his own experiences. The idea that you can divide a company into parts--"You take finance and administration, I'll take sales and marketing"--is "a myth," he says flatly. "You can't do it. At least not right away. We need to learn from each other."

The company's hiring-and-firing philosophy topped Gloria's concerns, and she was blunt with Manning. "She told me, 'I don't want you to do anything that would endanger the loyal employees we have here.' She didn't beat around the bush." Gloria confirms their conversation. "There are some people here who are just sacred," she says. "That's all."

Compensation, when it came up in late December, was a matter of context. It was no secret that Manning, as a COO or CEO-for-hire, had always made much more than his friend the entrepreneur. But this time the base was far less important than the kicker. Manning wasn't looking for the 50% stake he'd enjoyed with his previous company, but he wanted his stock options to provide a sizable incentive. (Eventually, Manning and the McManuses would arrive at a vesting schedule that caps Manning's options at approximately 30% of the company's stock, to be earned as the company reaches certain revenue and profit levels.)

As for salary, the McManuses addressed that just a few weeks before Manning arrived. "I just told John my break-even point," Manning says. The McManuses gulped. Manning's basic expenses were much higher than those of the couple, who have no children and live simply by Santa Barbara standards. But Manning's resulting six-figure salary was actually below average for a COO's pay. (The average is approximately $142,000 for a $10-million company in Southern California.)

On Monday, February 2, 1998, with the final details of the comp package to be ironed out, Manning began his 2,500-mile cross-country commute from upstate New York to Southern California. He put off the house hunt for months. The new Magellan's executive even forgot to collect a paycheck his first two weeks. Perhaps not by accident. "I didn't feel like the deal was really closed until I got here," says Manning. "If it hadn't worked out, we would have hugged and gone back to being friends."

The Nonheroic Owners--Happy at Last?
Since February 2, Manning's list of duties has grown steadily. First things first: he did an overhaul of accounting, which hadn't produced a real profit-and-loss statement in months, much to Manning's horror. And then there was marketing, which had gone unchecked. (Says Manning, "It seemed that every day I learned about another marketing deal we had.") But there was so much more to attack: administering the 401(k) plan; organizing the many pieces of an ongoing expansion; and systematizing the hiring-and-firing process.

"John knows how to hire people," Manning says, trying to explain the difference between most entrepreneurs and a good professional manager, "but he doesn't know how to set up a good system for hiring people. I'm growing a team that can eventually manage other managers." Exactly when a founder is likely to max out his or her skills, he says, is not a simple function of the number of employees at a company, the sales volume, or how long the entrepreneur has been in business. "Some companies need help almost from the day they're started," Manning ventures. "John and Gloria lasted longer than most."

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