In the words of Telstra chief executive David Thodey, it was "obviously an unsettling day in Canberra".
Business leaders contacted by BusinessDay failed to find the bright side of the leadership challenge that wasn't, with some calling for a snap election and warning that consumer and business confidence would pay the price for continued political uncertainty.
Departing BC Iron chief executive Mike Young watched events unfold from a conference in Hong Kong and said: "It's so bizarre that I can't be bothered commenting on it."
Bill Wavish, who heads the consortium that bought retailer Dick Smith, said: "The sooner we can get this election out of the way and get on with real life the better."
Myer managing director Bernie Brookes warned that distractions prevent proper governing.
"We rely on an elected government to manage and strategically direct everything from fiscal policy to social programs. Such actions require focus and direction."
Harold Mitchell, executive chairman of Aegis Media Pacific, said Australia needed a "clear leader with the strong support of their own party".
"Anything less than that will of course have an impact on confidence and affect everyone," Mr Mitchell said.
Ian Carson, chairman of partners at corporate advisory firm PPB, said Australian businesses had endured "a long period of uncertainty".
"Like the cardinals in Rome, what we need is some white smoke," Mr Carson said. "We need some certainty at federal government level so companies can get on with creating jobs, making investments and move ahead with important business decisions."
Billionaire miner Clive Palmer said there was a "whole heap of people who really have been shut out of government and the Labor Party" under Ms Gillard's leadership and said Labor needed a new approach to taxing the mining industry.
Perpetual director Sylvia Falzon said Labor needed to improve its consultation with business and give Australians "confidence about what they stand for rather than being an inward-looking government".
"This whole political environment has held organisations back - from employing people, capital investments, all those issues," Ms Falzon said.
Chris Whitehead, chief executive of the country's biggest credit union CUA, said the leadership instability tended to make people less confident. "When there's uncertainty people are reluctant to make big decisions and big investment decisions," he said.
Dr Andrew Wilson, senior economist with Australian Property Monitors, said: "With confidence rising, the last thing the market needs is to have a left-field issue such as significant political uncertainty."
The chief executive of PwC Australia, Luke Sayers, said political instability was discouraging foreign companies from purchasing Australian assets.
"Forgetting Labor, forgetting Liberal, Julia Gillard and Tony Abbott, business is looking for stability, looking for clarity, decision and leadership that promotes investment and drives business," he said.