What is Violin Memory's sacked CEO still doing on their board?

Good Resource Use

When a company transitions from a private to a publicly traded organization everything else changes as well. Very few CEO's can make that transition successfully, especially in a crowded product category like memory. If you've created the market that person can often keep everything working because they've got a clear vision of where they want to see things. But Violin certainly didn't create this market.

The type of thinking required to ram a company into the public space isn't very compatible with the tactical thinking required to maintain and grow in a crowded space. That ramming speed all the time thinking is absolutely critical to get going, but afterward it becomes a liability. Your course has been set and overly aggressive maneuvering at that point will capsize the whole ship.

But just because the needs of the role have changed doesn't mean that person isn't still a valuable asset. An aggressive board member or two is always a good idea. Boards as a whole have a tendency to stagnate if no one is upsetting the status quo and a board that doesn't like or drive change is a massive liability.

Consider Winston Churchill, absolutely atrocious leader and statesman if there are no Nazi's to kill. But just because the situation changed doesn't mean you execute Churchill. There's no telling if you might need him again and even an out of touch voice that doesn't appear to be rational can have good ideas if they've got experience.

Everything is negotiable

As is his exit.

Considering the manner of his exit it's hard to imagine him being able to or being allowed to continue effectively as a productive board member.

Without an acceptable golden parachute he may be waiting for an offer of acceptable renumeration. Holding onto his board seat is probably the only chip he has at this point (the other being an extended non-compete).

Gates and Ballmer are still on Microsoft's board...

Why shouldn't Basile sit on Violin's? If he wasn't a good CEO he may still be a useful board member - it's a different role. Microsoft show that the implied conflict of interest in picking the next CEO is not unique (which is not to say it is not serious). I suppose a board member with a conflict of interest can refrain from participating in voting or even discussions on a particular subject matter.