The stewardship of a multi-billion dollar company comes with a lot of responsibility.
It comes with a lot of rewards too – like a multi-million dollar paycheck – but if anything goes wrong, it's your fault.
Given the nature of the business world, a leadership cock-up often involves losing your job, and also includes a very public X next to your resume when you start looking for your next role.
Sometimes the weight of the responsibility can lead to a corporate do-nothing attitude where directors can remain apparently passive in the face of weak business performance.
Other times the collective group-think of a board can lead to inertia, slowing response times to a rapidly changing market place.
On yet other occasions, like at Woolworths Limited (ASX: WOW), executives develop aggressive and dynamic responses with code names like Project Oxygen, and then pray mightily it comes off successfully.
Woolworths' Masters Hardware strategy – Project Oxygen – falls into the latter category.
Named for its potential to suck the oxygen from the embers of supermarket competitor Coles back in 2010, it instead looks as though Woolworths is the one asphyxiating.
Immensely expensive, costing nearly $3 billion so far, Project Oxygen was designed to unseat competitor Wesfarmers Ltd's (ASX: WES) Bunnings Hardware from its seat as Australia's dominant hardware enterprise.
However the losses keep piling up, and the Australian Financial Review reckons that Woolworths' poorer grocery performance combined with the perception that the company is more expensive compared to Wesfarmers-owned Coles could be a killer.
While poorer grocery performance is a critical issue for the company to focus on, it's the continued losses from Masters that will be the straw that breaks the camel's back.
Unfortunately, to use the gambling analogy; Woolworths is 'all in' on Masters, with a $3 billion pile of chips sitting squarely in the middle of the table.
To fold now would be to invite massive losses and smash the company's share price as investors bail out.
However to keep pouring money into Masters could of course magnify the potential losses, which must have management asking the most fundamental and difficult to answer of investing questions; 'am I pouring good money after bad?'
I personally think Woolworths is likely to eventually succeed, but future reporting periods could easily see a few knives stuck into its share price.
Bargain hunters and long-term investors watch closely.
