The executive eulogies have been flying off the shelves like new Barbie accessories since last night's announcement that embattled Mattel (NYSE: MAT) Chairman and CEO Jill Barad resigned, effective immediately.

Though she's been widely pilloried for dragging the company downward with the ill-fated acquisition of consumer software firm The Learning Company (TLC), today she was also remembered as a fiery marketing wizard credited with the revitalization of the Barbie brand.

Investors, though, will primarily recall the last year or so, which saw their shares battered as the company repeatedly warned it would miss Street earnings estimates, moved to slash payrolls and shut plants, and said good-bye to key executives. COO Bruce Stein was among those who left in March; CFO Harry Pearce said recently he'll bid the company adieu next month.

"The board of directors and I view the performance of The Learning Company, and its effect on our results, as unacceptable," Barad said in a statement released last night. "Therefore, the board and I have agreed that today I resign from the positions of chairman and chief executive officer of Mattel and as a member of the company's board."

Mattel shifted some people around upstairs while it looks for a replacement. Here's a link to the full press release. There's also an expensive restructuring on the way that could end up carrying a price tag in the hundred-million dollar range in the form of a first-quarter charge.

The company's shares have moved forward a bit lately as Barad's departure became a poorly kept secret. What Mattel hopes now, as it has for some time, is that investors will look at TLC as a blight on an otherwise attractive package -- and Barad, who has been making that point publicly for some time, has accepted the role of scapegoat.

Who else, though? TLC cost Mattel approximately $3.5 billion and when it turned out to be a lemon Barad's judgment and financial knowledge came under fire, dulling much of the glow she'd picked up during her rocket rise at the toymaker. TLC delivered more than $200 million in losses before restructuring charges for 1999 as sagging CD-ROM sales led to inventory problems and discounting.

Wherever the responsibility may lay, this is only a small part of the job Mattel must now undertake to regain investors' favor. With most of the top management duties now in different hands than they were just a few months ago and a stable of strong brands including Barbie, Fisher-Price and Hot Wheels, Mattel has some of the tools for a turnaround but whether investors will be quick to support the company's efforts remains to be seen.

Also key will be the manner in which Mattel addresses its interactive division. Will TLC be simply cut loose? Clearly, with the growth seen and foreseen in electronic entertainment, Mattel needs to be there -- and TLC may not be the answer. More decisive action by the company and its board above and beyond bidding good-bye to its CEO will be needed before Mattel will once again delight Wall Street the way Barbie delights little girls.

Related Links:
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Fool Plate Special, 10/4/99: "Mattel's TLC a Scrub"