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Pozen regrouping Fidelity
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May 8, 1997: 9:20 p.m. ET
Company's new investment chief says turnaround requires change in strategy
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NEW YORK (CNNfn) - When Robert Pozen was tapped to succeed Gary Burkhead as the president and chief executive of Fidelity Research & Management, some called it an unlikely choice and wondered whether he was up to the task.
While Fidelity has $500 billion under management and is one of the leaders in the industry, a weak performance of late has led to a shake-up in the firm's executive ranks.
The company took a different path in choosing Pozen, opting for in-depth industry knowledge rather than extensive portfolio management experience.
Appearing Thursday on "Moneyline with Lou Dobbs," Pozen said he believes he brings a lot to the table that will help Fidelity upright itself.
"I've spent a lot of time in the investment process. For 10 years, I've been involved in reviewing funds, have dealt with a lot of issues with portfolio managers and designed and started a lot of our new funds.
"When people understand managing is not stock picking, it comes together in their minds. You have to set things up so you have good trading relationships, good systems, cater to market channels and make sure reviews go off well," he said.
Pozen said Fidelity's new structure is designed to free analysts from ancillary tasks so they can be left to focus on picking winning stocks.
The company has also bolstered its management ranks and created new support positions to ensure Fidelity is firing on all cylinders.
"I've also bolstered our research organization and we have a new group leader who comes to us from the Far East and has been with Fidelity for a number of years.
"We've also created the position of director of analysts. That person will work with analysts on a day-to-day basis. We have 80 to 90 analysts just in Boston, so we need managers to make sure they're doing a good job," he said.
Pozen said other planned changes, such as more closely tying fund performance to a manager's compensation, will help bolster investors' confidence. (339K WAV) or (339K AIFF)
He said the stock market has started to diversify and is generating a number of winners across all sectors and types of companies. Those changes give Fidelity new chances to prove its worth, Pozen said.
"A large research organization can really show its stuff by finding stocks that are undervalued and going with them," he said.
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Fidelity Investments
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