and out of AT&T stock based on their changing assumptions of how the merged companies would conform to their investment style. There was a seismic shift in the investment thesis surrounding AT&T as it morphed from a boring but steady utility to a company with much of the volatility of a high- growth start-up. But, for the most part, that shift went unnoticed be- cause institutional investors report their holdings only quarterly. AT&T watchers were left to their own devices to explain its mori- bund stock price. And the reasons they came up with-AT&T over- paid, the cable upgrade will be very expensive, the technology is uncertain, and SO on-soon became common wisdom, along with a persistent suspicion that AT&T had moved too fast, throwing caution to the winds. "It was very clear to me that the deal was put together in eight days," said Brian Adamik of the Yankee Group. "There are a lot of rocks that haven't been turned over."I2 The next issue to crawl out from under those rocks would have a negligible effect on the company's share price but a profound impact on its efforts to transform its consumer business. This page intentionally left blank Casting Is Everything The biggest mistake a CEO can make is a bad casting decision- either dumping somebody simply because she was part of the old team or waiting too long to replace an executive who doesn't share the same vision or values. Given enough time, an incompe- tent executive can be coached and retrained. Given enough time, an executive who is working at cross purposes with the CEO will poison the entire organization. CEOs should treat hirings and firings as teaching moments to reinforce their goals and strategies. Hindery and Zeglis Although John Zeglis was president of the company, on the weekend before the TCI merger was announced, he didn't know much more about the negotiations than I did. He had, in fact, been preoccupied with the BT discussions, which seemed to be going well but were entering sticky valuation negotiations. To make it a true 50/50 ven- ture, a