Lloyd Ward: victim or villain? In an exclusive interview, the former U.S. Olympic Committee CEO tells his side about what led to his ouster. Was it a nasty campaign to discredit him, or did his unpopular business practices and management style derail his career?

IT WAS ALMOST BY ACCIDENT THAT Lloyd David Ward discovered that the press didn't welcome him as the new CEO of the United States Olympic Committee (USOC). He had arrived at USOC headquarters in Colorado Springs. Colorado about, a week before his official Nov. 1, 2001, start date so that he could meet with the staff. Upon returning to his hotel room, his wife, Lita, picked up a Colorado Springs newspaper and read this headline from the sports page: "USOC Sinks to New Low with New CEO."

The Wards were shocked. The article criticized the USOC for its previous choice for CEO, Norm Blake, a former hotel and insurance executive known for engineering a turnaround at insurer U.S. Fidelity & Guaranty and guiding Promus Hotel Corp. toward a lucrative merger with Hilton Hotels. He lasted only nine months at the USOC when his "no holds barred" management style clashed with volunteer leaders. Arguing that an important event such as the Olympics should not be entrusted to corporate types, the article forecast that the already beleaguered USOC would continue its troubled ways since Ward also had a corporate background and no Olympic experience, Ward wondered how the press could make such a damning conclusion without meeting him.

That article was the first salvo in Ward's Highly publicized battle with members of the USOC. According to Ward, the political power structure within the organization was hesitant to adopt his new system that rewarded performance. There was resistance so displacing on entrenched system that often rewarded board members with political favors and considerations. His opponents claim that he used his position to try to pass along lucrative service contracts to his brother and travel with his wife at the USOC's expense. Wave after wave of accusations culminated in a flood of negative media coverage. Senate hearings, sweeping reform within the USOC, and eventually Ward's departure.

Whether Ward is a victim of cutthroat politics Or an exec that made a series of miscues in on overzealous pursuit of an agenda, the 55-year old son of a Baptist preacher provided BLACK ENTERPRISE with an exclusive look at the scandal that led to his resignation in March 2003.

WARNING SIGNS

Ward's road to the USOC began during the summer of 2001, when he received a call from a headhunter about the USOC's top spot. Ward seemed ideal for the USOC position. The native of Romulus. Michigan, had an impressive resume that boasted a mechanical engineering degree from Michigan State University and a master's degree in business administration from Ohio's Xavier University. Ward's corporate experience was in abundance. He joined Pepsi Co Inc. in 1988 as the vice president of operations for Pepsi-Cola East, and later, as head of Frito-Lay's Western and central divisions, he raised the company's market share in those regions from 50% to 56%. Frito-Lay made close to $5 billion in sales during 1994. Sales from Ward's central division accounted for more than $1.3 billion, and he was named BLACK ENTERPRISE Corporate Executive of the Year in 1995. Ward left Pepsi and served as CEO of Maytag Corp. from August 1999 to November 2000. He then got involved with iMotors, an online seller of' pre-owned and reconditioned cars, which went under in June 2001 following the dotcom bust. (A few months later, the company was acquired by Next Phase Media, which continued the service.)

While Ward and the USOC looked like a Good fit, he was concerned that the CEO position was vacant tot almost a year. He began to learn more about the USOC and its unfortunate history of political turmoil. Created by the Amateur Sports Act of 1978 (now the Ted Stevens Olympic and Amateur Sports Act), the USOC is a non-profit company that is responsible for coordinating the country's participation in the Olympic Games. The act was created to appoint one entity (the USOC) as the coordinator for all Olympic athletic activity in the United States.

The act, however, didn't accurately explain how power within the USOC should be shared. It suggests that the president, a 23-member executive committee, and a 123-member board will work to set policies for the organization, which ,will then be implemented by a CEO, who will coordinate a paid staff while raising money for the athletic programs. Unfortunately, this governance structure created discord between the president and CEO over who controls domestic and international matters and how to best use the money that is raised. The political infighting has been so tumultuous that in its 25-year history, the USOC has had 13 CEOs (including Ward) and 11 presidents.

Ward says he was concerned but was intrigued by the challenge of running such an organization. He became one of three finalists, which included Kurt Schmoke, the former mayor of Baltimore who came from mostly political background, and Scott Blackmun, the interim CEO who was a longtime member of the Olympic family. When interviewing with the board, Ward's message of change resonated with many of its members, and with some behind-the-scenes lobbying by USOC president Sandy Baldwin. Ward was named CEO some three months before the 2002 Olympic Winter Games. He inherited a tight deadline, which left the organization with little room for error in preparation for the Games, the responsibility of overseeing the USOC's $491.5 million four-year budget, and all the political turmoil that went with it.

Unbeknownst to Ward, he also inherited a culture that was so steeped in politics that the CEO selection process had itself become a political battleground. Ward says that the board of directors had some unwritten rules, and by gaining the CEO job, he was considered indebted to those who had supported him. Through research, Ward knew that his predecessor, Blake, tried to implement an "all business" approach to change the USOC culture, but failed. "[Blake] took things to a more performance-based allocation of financial] resources to the National Governing Bodies.... He was changing the structure from one of entitlements."

Unfortunately, Blake made the mistake of bringing in many of his own people to replace longtime USOC staffers. This created anxiety and resentment. "In my estimation, the biggest difference between [Blake] and Lloyd was that Blake did not take the time to try to understand the organization, listen to the people, or take their concerns into consideration." says, Jim Joy, a USOC board member who represents the community-based Armed Forces Disabled Sports Organization.

Months after joining the organization, Ward discovered that Baldwin had won her position by advocating for Blake's removal. "'She was elected, and she go"[Blake] out," says a USOC insider. "Scott Blackmun was appointed interim CEO because he was an internally who understood the rules of the game." According to the insider, these rules emphasized political favoritism rather than the best interest of the entire organization.

BEGINNING OF THE END

With his master motivator mode on full throttle, Ward pulled his new staff together in the wake of Sept. 11, 2001, and presented arguably the most successful Winter Olympics in U.S. history. "He was well-organized, and he and a personality that was extremely attractive in getting people to buy into his plan,'" says Gwendolyn Calvert Baker, a member of the internal task force to reform the U80C. "His most positive aspect was that he was a visionary," she says. "He believed in where he wanted to take the USOC. He wanted to strengthen it and to help it grow, attract more sponsors while keeping those that we had, and produce as many medal-winning athletes as possible."

The 2002 Olympic Winter Games netted more than $876 million from sponsors, sold approximately 1.53 million tickets, and produced 34 medals for the United States--the most ever at an Olympic Winter Games. While at the Games. Ward carefully conducted over 60 meetings with sponsors and suppliers to make sure that they were being serviced properly and to talk about future commitments. "Salt Lake City was a success flora a security point of view, from a performance point of view, and from a fan's point of view. The sponsors felt great about it too," he says.

With the challenge of the Winter Games successfully navigated, Ward Mt that the organization was firing on all cylinders. Thanks to work by Baldwin, the USOC's relationship with the International Olympic Committee (IOC) was improving. Ward and Baldwin worked well to get her. She took the lead on international matters while he handled domestic issues. Unfurtunately, things began to fall apart shortly after the 2002 Olympic Winter Games.

"One of the problems that Lloyd encountered was that two of the individuals he hired had never been associated with the Olympics before." says Ron Creel, a member of the USOC board of directors.

Though Ward would later bring in people with Olympic experience, the damage had been done. "You have to understand that there's a lot of jealousy,'" says Creel. "When someone from the outside comes in and has never been in the Olympic movement before and [the staff] is scratching their head over some of the decisions being made ... they're saying he'd probably not be making those decisions if he'd been here for 15 years."

With resentment festering, Ward would have to deal with his next crisis. While attending ah IOC meeting in Malaysia, Baldwin received a phone call from a USOC employee who warned her that, an article was about to reveal that there was no official record of the doctorate degree that she claimed to have earned. Ward and Baldwin flew back to the United States and were greeted with a blizzard of bad press. Baldwin was vilified for misrepresenting her credentials to obtain her position as USOC president, and the papers called for her to resign. The executive committee also called for Baldwin's resignation, but asked Ward to execute "the order to terminate his ally.

I was somewhat uncomfortable with that," says Ward, not sure what the political fallout would be. After all, Baldwin had given her life to the Olympics, starting out as the parent of a swimmer and rising to

the presidency of the organization. With the help of a longtime staff member who worked closely with the volunteers, Ward convinced Baldwin to step down in May 2002. With Baldwin gene from the executive committee, Ward discovered that she had used a great deal of her influence to deflect attacks against him. She had also lobbied to bring him in as CEO. Insiders speculate that she may have grown bitter about being asked to resign. Ward claims that a board member he refused to identify said Baldwin felt that. Ward should have stood up for her and not accepted her resignation. Baldwin could not be reached for comment.

NEW PRESIDENT, NEW PROBLEMS

Marty Mankamyer, a close friend of Baldwin's and a USOC board member with years of experience, was appointed interim president in May 2002. Mankamyer had opposed Ward's hiring, but the board of directors confirmed her as president of the USOC on Aug. 15, 2002. With her friend as the new president, inside sources speculate that Baldwin, who retained a seat on the 123-member board of directors, began a campaign to remove Ward as CEO.

There were signs to back up this speculation. On Aug. 16, her first day on the job, Mankamyer sent a letter to Ward, informing him that she was moving her office and the international staff into new and more costly executive suites. The letter went on to draw a line between her management of the international volunteers as president and Ward's management of domestic staff as CEO.

Ward denied Mankamyer's request because of budget considerations (it would cost $180,000, says Ward). This was the first of a number of spats between the two. Less than two weeks after sending the first letter, Mankamyer struck again. On Aug. 29, 2002, she sent a letter "o Kenneth Duberstein, the chairman of the USOC Ethics Oversight Committee. Mankamyer claimed that she had received reports of allegations that Ward sought retribution by allowing his staff to investigate certain USOC employees. The retribution was alleged to be a result of certain USOC employees' interaction with and support for Mankamyer concerning her desired office move and certain international relations matters. Duberstein reviewed the claims and found no merit to the allegations.

On Oct. 24, 2002, a meeting was conducted by the Ethics Oversight Committee so that they could review additional allegations concerning Ward. Hernando Mandronero, the former managing director of international relations, and Patrick Rodgers, the former USOC ethics compliance officer, alleged that Ward directed Mandronero around April 2002 to assist his brother, Rubert Ward, with procuring a business arrangement with Dr. Jose Joaquin Puello, president of the 2003 Pan American Games Organizing Committee. The purpose of the meeting was to help Rubert Ward's employer, Energy Management Technology (EMT), obtain financial assistance to provide microturbines for the Pan Am Games and to help the company maintain its operations in the Dominican Republic. Mandronero's acknowledgement of making some calls to Rubert Ward was enough to officially get an ethics violation investigation underway.

By November 2002, the internal investigation had been handed over to attorney Fred Fielding of Wiley, Rein & Fielding, who was responsible for conducting interviews and filing a written report with the Ethics Oversight Committee. Just before Christmas 2002, someone leaked to the press that the ethics investigation was underway. Duberstein and members of the committee received reports that Mankamyer was discussing the investigation with people outside of the Ethics Committee. Before Fielding indicated that his written report, was ready and the USOC Ethics Committee concluded their findings, Mankamyer scheduled an executive committee meeting for Jan. 13, 2003, to discuss the allegations concerning Ward. This information was leaked to the press. Furthermore, Mankamyer composed what she termed a "100-page comprehensive notebook" detailing the allegations, which she sent to board members in preparation for the Jan. 13 meeting. Copies of the notebook, which contained a 75-page presentation, faxes, e-mails, and other memos that were supposed to support the case against Ward, made it into the hands of several reporters.

In an attempt to defend himself against what he felt was misleading information in the notebook Mankamyer distributed, Ward sent a Jan. 1,2003, e-mail to executive committee members giving his side of the story regarding the allegations. In the e-mail, Ward stated that he had no financial interest in EMT, that he was not involved in any of the follow-up actions Madronero arranged, and that he did not believe it was a conflict of interest since neither he nor his brother had a financial stake in EMT. Ward does admit, however, that he "made an error in judgment by not disclosing this situation in judgment in the Annual Disclosure Certification."

At their Jan, 13 meeting, the ethics committee found that there were no ethics violations, but there was "an appearance of conflict of interest," for which Ward was stripped of his $184,800 bonus. The committee did have a larger concern with Mankamyer, and she was asked to resign.

"So not only did Lloyd beat the allegations, but Marty ends up getting fired because she did this," says an insider." That's the biggest turnaround you can imagine." The report from the Fielding investigation concluded that the initial solicitation letter that Ward received from EMT was indeed dealt with in an up-front manner. Rodgers also conferred with USOC General Counsel Jeff Benz regarding the EMT proposal. Again, they concluded that there was "no apparent problem" with what Ward had done. In addition, it was confirmed that Mankamyer was one of the causes of leaked information LO the press. Many felt that this demonstrated her bias against Ward.

ENTER THE SENATE

Following the decision, Rodgers, ethics committee members John Kuelbs, Edward Petry, and Steve Potts, as well as USOC executive commit, tee member Brian Derwin, all resigned They felt that the judgment concerning Ward was too lenient. Mankamyer decided not to resign. The mass defection made the USOC front-page national news again, which did not sit well with Sen. Ted Stevens of Alaska (he spearheaded the legislation that chartered the USOC more than 25 years ago). Senate committee hearings were scheduled to deal with the causes of the incessant infighting that had been plaguing the USOC for years. Republican Sen. John McCain headed the Senate panel that would hear testimony concerning the allegations leveled against Ward and other issues related to the governance and operation of the USOC.

The Senate hearings were held on Jan. 28, 2003, but even before the hearings were underway, some form of government, intervention to change the USOC governance structure was assured. Testimony from Duberstein detailed the events that allowed the ethics investigation process to be corrupted by executive committee members.

The Ethics Oversight Committee reviewed Fielding's oral and written report on Dec. 23, 2002. Duberstein indicated that this report was pivotal to clearing Ward of serious ethics allegations. Duberstein testified, "in addition to the review of Mr. Ward's conduct, the Ethics Oversight Committee now had to deal with the findings based on Mr. Fielding's oral and written report and their own experience during the review, that two individuals, Ethics Compliance Officer Patrick K. Rodgers and USOC President Marty Mankamyer, tried to use the ethics process to advance their own agenda."

The admission that "... [Duberstein] and members of the executive committee had received reports that [Mankamyer] was discussing the [ethics] review and the initial allegations with individuals outside of the Ethics Oversight Committee," and "... the failure of Mr. Rodgers to do timely compliance counseling of Mr. Ward, which could have helped avoid all this," supported Ward's claim that he made "ah error in judgment" by not disclosing his brother's involvement when he filed the Annual Disclosure Certification.

Mankamyer attempted to defend herself against the charge that she willingly leaked information by suggesting that the USOC policy that called for broad distribution of information to the 123-member board of directors increased the likelihood that leaks would occur. When the Senate hearings ended, Mankamyer also ended her presidency. She resigned on Feb. 4, 2003.

MOVING ON

Even though he was most]y cleared of any wrongdoing, Ward continued to receive pressure from the press to resign. Initially, Ward resisted the idea, But his vindication by the Ethics Oversight Committee didn't change the continuous flow of negative news leaks. After the Senate hearings, he was hit with another barrage of negative allegations. His administration's travel expenses came under scrutiny on Feb. 25. 2003. It was alleged that he billed $115,664 in 2002. His wife's alleged portion of those travel expenses--$27,813--made some people speculate that he was misusing USOC funds for personal gain. Critics suggested that trips Lita Ward took to the U.S. Figure Skating Championships and to the U.S. Open tennis tournament might have been inappropriate to be paid for with USOC funds. Flights to see ex-heavyweight champ Evander Holyfield fight in Atlantic City, New Jersey, and trips to Ward's home in Florida were also questioned.

"I went [to the boxing match] because I was looking at sponsor connections and donor opportunities. I paid all of Lita's expenses," says Ward. He contends that his biweekly flights to his borne in Florida were covered in his employment contract, which provides for that accommodation while he built a house in Colorado. Ward attributes other expenses to official business. Even with the allegations about misuse of travel expenses in the news. Ward pressed on. After all, despite the bad press, he had an impressive list of accomplishments while at the helm of the USOC.

Where Blake had failed to implement a more performance based approach at the USOC, Ward succeeded. "For the first time, the executive committee, the compensation committee, and the CEO had a good understanding of what everyone's goals and objectives were." says board member Joy.

Ward and his team had also conducted comprehensive multi-year strategic planning sessions with 39 of the 45 National Governing Bodies that send athletes to the Olympics--something that had never been done before. According to Ward, this would help the National Governing Bodies improve their sports and raise money.

He also accelerated the signing of sponsorships--netting a 1,700% increase in Quad (the four-year period between Olympic Games) sponsorships, compared with the prior Quad--despite the nation begin the throes of a bleak business environment

Ward also created the Titan Games, a new property for the UOOC to showcase martial arts competition and combat sports, one of his passions. Held in California from Feb. 13-15, 2003, the Titan Games fulfilled his promise to create new properties to help market the Olympics during the four-year hiatus between games.

A mandate that the governance model of the USOC be changed came in the aftermath of the Senate hearings. With the move to reform the USOC underway, many thought that Ward should also resign to give the organization a clean slate. Although the allegations of Ward's misuse of USOC funds were never proven, continued media scrutiny and threats from Colorado Sen. Ben Nighthorse Campbell, a former Olympian, to move ahead with more investigations finally took its toll. Ward resigned on March 2, 2003.

Ironically, Ward received a vote of confidence and "exemplary" job performance re view from the USOC executive committee just weeks before he resigned, which begs the question of whether or not he was derailed by cutthroat politics or was ah executive with a lack of integrity and management skills that was supported by a corrupt organization. Opinion among USOC board members is mixed. "There was a very small group, and I want to emphasize a very small group, within the Olympic family that didn't want Lloyd as president and CEO," says USOC board member Ron Creel," says USOC names, but in my professional opinion, I think they orchestrated a campaign against Lloyd and got the press involved. And once they got the press involved, then somebody from Colorado got Senator [Ben Nighthorse] Campbell, [John] McCain and [Ted] Stevens involved, and that's where we are today."

These days, LI@ Ward is content to think about his future. He has co-founded Body-Blocks Nutrition Systems, a manufacturer and marketer of energy and meal replacement bars and drinks that provide nutrition for people with active lifestyles. And while he hasn't ruled out heading up another Fortune 1000 company, Ward says the experience at the USOC has taught him a bit more about himself. "As African Americans, we always talk about the politics of organizations," he says. "But, there's a whole different level of politics when you are running for office. It became clear to me that this was no longer my domain of excellence."

Though perhaps no consolation, Ward did manage to bring about positive change at the USOC. He has left some systems in place that will help the next regime of leadership run the organization better. He has also helped bring more than $380 million in sponsor revenue to the Games.

And the reform process moved ahead in October 2003 when the USOC board of directors voted to reduce its size from 123 to 11 members, disband its executive committee, and enact new governance policies. The organization acted without Congress, which may still weigh in on the changes. USOC acting President Martin says the new procedures and new leadership will be transitioned into place over the course of this year.

"I take great solace and pride in the fact that my tenure at the USOC has led to fundamental reform of the organization that will position it to serve athletes and the American public for the next several decades in ways that are consistent with what the Olympics stand for and represent," Ward says. "It will be less political and more focused on athletes and competition, performance and international community, good will, prosperity, and peace and harmony in the world. That's what it's all about."