Worst CEO of 2012? Greenberg Makes His Pick

I've been doing this "Worst CEO List" for years, and this one is among the toughest. (Read More: The Worst CEOs for 2012)

And the winner is ... (REUTERS/Brendan McDermid)The "please name" list was long, thanks to my Twitter and Facebook followers, and included Meg Whitman of Hewlett-Packard (HPQ) (nah, she did great building eBay and inherited a mess at HP!) and Chesapeake (CHK) CEO Aubrey McClendon (definitely deserving).

The metrics for landing on my list are many; the stock price is only one variable. Yes, the choice is always subjective. And, yes, it's easy to be an armchair CEO when the most I've done is co-run a two-person business that lasted for two years.
But I've also been observing and writing about the good, bad and ugly among businesses for around 40 years and have watched one too many CEOs get a free pass.

(Read More: Mark Pincus Loses $4 Million a Day for Seven Months)
Good CEOs are easier to pick, and not just because of the stock price (which a CEO can't control) or fundamentals, which if genuine can be finicky. But because of a clear strategy and, ultimately, the level of execution. Look no further than Howard Schultz of Starbucks (SBUX), Frank Blake of Home Depot (HD), the recently retired Jim Sinegal of Costco (COST) or the recently departed Apple (AAPL) titan Steve Jobs, as prime examples.

Or Jeff Bewkes of Time-Warner (TWX) or my ultimate boss, Brian Roberts, of  comcast (CCZ). (Yeah, it's a conflict to mention him, but get over it!) Or Ajaypal Banga of MasterCard (MA) and J. Crew's Mickey Drexler.
And despite the ongoing bull-bear fight over his stock, it's hard to leave Jeff Bezos of Amazon (AMZN) off the Best CEO List. What a remarkably disruptive execution on a plan that so many others could only make work on paper, not practice.

But Worst CEO? I anguished over my pick more than usual this year, flip-flopping on my top choice until the very last minute.
In the end, the worst CEO can be none other than Andrew Mason of Groupon (GRPN), whom I picked as my front-runner earlier this year.
Before we get into the reasons, those who made my final cut:
Steve Ballmer of Microsoft (MSFT). (Truth be told: For a few moments, as I argued with myself during the writing process, he took the No. 1 spot.) This is more of a cumulative call, culminating with Windows 8, which hasn't exactly knocked the cover off the ball (or moved the needle in PC sales, as Ballmer had predicted it would do.)

(Read More: JCPenney Turnaround in Doubt as Sales Plummet)

Its miserly low-single-digit gain lagged the S&P 500's roughly 12.5 percent gain this year. Worse, since Ballmer took control on January 1, 2000, Microsoft's shares have sunk by more than 40 percent.

And let's not forget this year's write-off of almost the entire $6.3 billion spent on buying online advertising company aQuantive in 2007 -- an egregious misstep that would get plenty of CEOs fired.
Yet, for all of the talk of Windows, it's only 25 percent of the business. Under Ballmer Xbox has excelled and the less-sexy but stickier "server and tools" segment for businesses grew to help buffer any slowdown in Windows.
But that's the point: Microsoft has largely become the equivalent of a lumbering, cash-rich, unregulated utility. Yet, with all of its cash -- $53.6 billion (including debt) at last count -- Microsoft pays a dividend that currently yields a paltry 3.4 percent. There hasn't even been a special dividend.
Maybe he's not the worst, but Ballmer deserves to be called out and including him on this list is one way to do it.

Ron Johnson of JCPenney (JCP), clearly the top choice of many. Despite his pristine history at Apple, Johnson has made plenty of blunders at Penney, starting with providing sales and earnings guidance for this year - overzealous guidance, at that - which has since been withdrawn. And for good reason: Comp-store sales last quarter plunged an astonishing 26 percent. But to his credit, Johnson also said from Day One the Penney turnaround, if he can pull it off, will be a multi-year process. I'm willing to cut him some slack.

The management style of Zynga's (ZNGA) Mark Pincus has rubbed many inside the company (based on a revolving door of executives and game developers ) and investors (its stock has tumbled 75 percent since going public) the wrong way. I believe he suffered from the blind hubris that often comes with an egregiously overpriced stock offering. In retrospect, as this Wall Street Journal piece articulates well, beyond going public it appears there was a lack of strategy that defines a exceptional CEO. And in this case, exemplifies one of the worst.

(Read More: Kodak Did Not Mislead Investors Before Bankruptcy: Court)

Antonio Perez of Eastman Kodak (EKDKQ), on this list for the second consecutive year. The difference between this year and last? Kodak hadn't filed for bankruptcy, which it did last January. Yet, remarkably, Perez wasn't fired for overpromising, under-delivering and, ultimately, leading the already downward-spiraling company over the solvency cliff. Perez inherited a tough hand in 2005, when he took the top job. Since then he has dangled one carrot after another in front of investors (an ill-times entry into the consumer printing business and an overly optimistic valuation of Kodak's patents.) Both have been losing bets. 

Which brings us to Mason: Without question Groupon was the most over-hyped IPO debacle of recent years, with a slide of 80 percent making it an even bigger loser than Zynga. And unlike Pincus, who has an admirable background starting companies, Mason has none.

He's a software developer who stumbled on the idea for Groupon and, by default, became CEO.

The mistake, no doubt, was not transitioning him out of the CEO role once the company decided to go public. Most entrepreneurs can make that transition and make it well; the good ones know when to step aside. 

His incompetence as a CEO was obvious from the initial public offering filing - in a letter to "potential" shareholders that argued "we don't measure ourselves in conventional ways."

From that point on it became obvious that Groupon was headed for trouble as a public company.

(Read More: Groupon's Andrew Mason Isn't Firing Himself)
Since then, the company has hasn't just floundered, but flopped. It's even had a series of accounting restatements. It now appears to be a public company in search of a business that (fingers crossed!) may work. Or (fingers and toes crossed) may get taken out of its misery by being acquired. On top of that Mason's goofball antics, which can come off more like a big kid than company leader, almost make a mockery of corporate leadership -- especially for a company with a market value of more than $3 billion. It would be excusable, even endearing, if the company were doing well (think Herb Kelleher of Southwest Airlines) but it's not. Sales growth is through the floor.
The only surprise (and I really hate to sound so harsh) is that Mason is still on the job. That's why nobody is more deserving to be named this year's Worst CEO.