Why OpenAI CEO Sam Altman is Reinstated After Being Fired

OpenAI’s board of directors fired CEO Sam Altman in a shock announcement, only to rehire him just five days later.

Popular chatbot ChatGPT has been front and center of the growth of artificial intelligence (AI), especially in everyday use. In fact, it set a record for the fastest-growing user base back in January after reaching 100 million active users that month—despite just launching two months prior.

However, even with the success of ChatGPT, there was turmoil recently within the company. OpenAI, the company in question, found itself losing its CEO after the board chose to fire Sam Altman on November 16. And what should have been the end of the story actually turned out to be the beginning of a whirlwind chain of events—which culminated with the rehiring of Altman. 

Here is how the events of Altman’s hiring and rehiring unfolded.

The Shock Firing of Sam Altman

It all started on November 17 when the shock announcement of the firing hit the headlines. According to the board, Altman failed to be “consistently candid in his communications.” And per a report by The Guardian, he was informed of what was to happen to him via a text message he received from a fellow board member.

The Business Insider notes that Altman does not own shares in OpenAI, which made it harder for him to stay in power. 

OpenAI’s Chairman and President, Greg Brockman, was told that he was being removed from the board—but he had the option to stay with the company. Brockman chose to quit instead. Following that, Mira Murati, the company’s Chief Technology Officer, was appointed as interim CEO. He was eventually replaced by former Twitch CEO Emmett Shear. 

On the other hand, Microsoft—OpenAI’s biggest investor—soon entered the fray with its CEO, Satya Nadella, revealing that they were not informed prior to the announcement of Altman’s sacking. Both Altman and Brockman were then hired by Microsoft to take charge of a “new advanced AI research team.”

OpenAI’s Employees Rally Behind Altman

By the time November 20 rolled along, things took a turn for the worse for OpenAI’s board. Almost all of the company’s 770 employees—including Murati—signed a letter addressed to the board that demanded that both Altman and Brockman be reinstated.

“Your actions have made it obvious that you are incapable of overseeing OpenAI,” the OpenAI employee’s letter to the Board stated. “We are unable to work for or with people [who] lack competence, judgment, and care for our mission and employees. We, the undersigned, may choose to resign from OpenAI and join the newly announced Microsoft subsidiary run by Sam Altman and Greg Brockman.”

“Microsoft has assured us that there are positions for all OpenAI employees at this new subsidiary should we choose to join,” it added. “We will take this step imminently unless all current board members resign, and the board appoints two new lead independent directors, such as Bret Taylor and Will Hurd, and reinstates Sam Altman and Greg Brockman.”

Aside from this, the signatories want the members of the board to step down. Should these demands not happen, all the employees who signed the letter are threatening to quit en masse

The Business Insider notes that the support of the employees reached social media as well. Many employees posted the phrase “OpenAI is nothing without its people” on their individual X (formerly Twitter) accounts.

The next day, after intense negotiations, Altman returned as CEO of OpenAI after he reached “an agreement in principle” with the company, according to The Guardian. New members of the board were also named. However, Altman was not part of them.

What This Highlights

The threat of mass resignation of the majority of OpenAI’s employees serves as a strong signal that Altman is well-liked in the company. After all, he wouldn’t have this kind of support if he was not seen as a good and capable leader. 

In its report, the Business Insider asks just how Altman has done it. The answer? “He’s super charismatic and super smart,” Holofy CEO Eduard Cristea, told Business Insider in an interview. “Almost immediately, you kind of feel it.”

The chain of events involving Altman’s firing and rehiring highlights how important it is for business leaders to have the support of their employees. In order to gain their support and confidence, business leaders should possess a number of traits that make them well-liked by the people. 

In Altman’s case, these traits include high levels of charisma and intellect. Aside from these, good business leaders should also be responsible, transparent, accessible to the people, and show good strategy and direction.