FOUR EXECS CROWD INTO OFFICE OF THE CHIEF EXECUTIVE: STRONG SETTLES SUCCESSION, SORTA

In a move that surprises few insiders, Richard Strong, the ironhanded founder and chairman of Strong Capital Management Inc., has abandoned his search for an experienced outsider to succeed him as chief executive.

Earlier this month, Mr. Strong, 56, named four youngish executives to a new Office of the Chief Executive, signaling his intention to remain at the helm of the Menomonee Falls, Wis.-based mutual fund company (assets: $29.7 billion as of Aug. 31) well into the future.

In a post-Labor Day announcement to employees, Mr. Strong said he had appointed director of trading David Braaten, 31, retail marketing director Tony D’Amato, 31, fixed-income manager Brad Tank, 41, and chief financial officer Thomas Zoeller, 34.

Mr. Strong said the four would assume their new leadership roles immediately, while continuing to lead their respective areas. “They will work under my direction as we continue to aggressively grow our firm’s assets and market share,” he said. Of the four individuals, only Mr. Zoeller, who became chief financial officer last February, had been listed as a principal executive officer prior to the management restructuring.

A Strong spokeswoman says the Office of the CEO is a permanent post and that the executives will meet formally with Mr. Strong once each week. However, the executives aren’t relocating their offices nearer Mr. Strong or one another. Mr. Strong will continue as chairman, chief investment officer and lead portfolio manager of Strong Discovery Fund.

too many cooks?

But not everyone is convinced the new arrangement will work. “It certainly appears cumbersome and awkward,” observes fund industry consultant Burton Greenwald of B.J. Greenwald Associates in Philadelphia. “A dual-CEO structure such as John Reed and Sandy Weill will have with Citigroup is always a difficult balancing act. To have a quad-CEO structure seems almost impossible, particularly when they are all from inside the organization and obviously in large measure beholden to Dick Strong.”

Moreover, the executives’ youth could handicap Mr. Strong’s ambitions to grow the mid-tier company amid an increasingly competitive and consolidating marketplace – particularly if the equity markets continue to deteriorate. The company will test its resources later this year when it launches a mutual fund supermarket to keep more of its fund investors and their assets in-house. And after flirting with a sale last fall, Mr. Strong now says he is interested in making acquisitions.

Conspicuously left out of the management restructuring were Thomas Lemke, 44, chief operating officer and general counsel, and Joseph DeMartine, 48, the chief marketing officer, who also is managing director of Strong Retail Services. Mr. DeMartine joined Strong in January 1995 after senior marketing postings at Dreyfus Service Corp., Bankers Trust and Fidelity Investments. Mr. Lemke joined Strong four years ago as general counsel, following similar positions at J.P. Morgan & Co., Sanford C. Bernstein & Co. and seven years with the Securities and Exchange Commission.

While Mr. Tank is an adept bond manager – he was a fixed income specialist for six years at Salomon Brothers Inc. in Chicago before joining Strong in 1990 – his skills in running a business are unproven.

Mr. Braaten, Mr. D’Amato and Mr. Zoeller all initially joined Strong in 1989. Mr. Braaten was named director of trading in 1994. Mr. Zoeller joined Strong as an assistant controller after three years with Arthur Andersen & Co. in Milwaukee. Mr. D’Amato was recently named head of retirement plan services.

The group’s collective inexperience suggests that Mr. Strong has little interest in turning over the reins anytime soon

“This creates the appearance of heading in that direction,” says a former Strong senior executive who requested anonymity, “but not risking actually having to do it in the meaningful future.”