The Horka Blog

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Lately I have been struck by outlandish headlines on web news sites such as CNN. The statements are so outlandish that I check to see who made the statement. Almost inevitably it is a nobody. By that I mean, not a common noted authority on the subject in question. That should not exclude the writer automatically, but similarly just because an article is printed does not automatically mean it has any credibility whatsoever.

It is used to be that newspaper editors tried to ensure that when articles where published, the authors had at least some claim to credibility. I don’t see anyone checking the credibility of any pronouncement these days. Want proof? Remember that article about how people who used Internet Explorer had lower IQs than those using other browsers? Many news outlets reported that story, even though the facts in the story itself should have given any reasonable person pause to question its veracity. Of course the story was a hoax. But what was even more shocking was the blind distribution of the story with absolutely no attempt to check the facts.

Where did the story originate, who were the authors?  What methodology did they employ?  Who did they survey?  Where were the results for others to review? Why were the IQ values cited in the story just plain nuts?

I think people used to trust editors to do a lot of vetting of stories before they were printed. Sure, publishers always had certain political and social leanings. But when you read a newspaper for a while, you would understand what those were. Similarly today FOX news is a right wing outfit, everyone knows that, and the message is twisted accordingly. Other news outlets are more left leaning. But even checking basic facts and figures seems to have gone out the window.

So it’s up to the consumer to apply discretion when reading news articles. If the story is about politics, is the author a politician, does the politician have recognized expertise in the area being discussed?  Is the story by an academic, are there other articles this person has written? Do they reflect knowledge and sound analysis?  What do critics think of this person, how much credibility does he/she have? Generally, I don’t expect profound analysis of international relations from local politicians whose primary emphasis in municipal or provincial or state issues. I don’t look to actors to provide me with a good understanding of what is happening economically. I don’t look to Sarah Palin to have the remotest notion of  world politics. I question most articles written by academics, unless they have served equal time in the real world. There is definitely something lost when a person only understands the world through book learning – or others’ views on real world experiences. I question financial commentary from corporate spokespersons. I look for people who have a track record of trying to assemble and present information in a logical way. No one is “objective”, everyone has preferences. That’s fine. But I prefer to know what they are so that I can take that into account when I read news stores. I know where Glen Beck is coming from and sometimes I find him amusing in a twisted kind of way.  And when I hear that someone says America’s ailments could be better addressed if Obama just prayed more, then I get downright scared that the separation between church and state in the US is just a sham and now we have to worry about religious nut jobs there getting hold of nuclear weapons.

Which gets us back to outrageous headlines. Since most news outlets will not check the accuracy of any news story, their prime criteria for publication is simply to print whatever is outrageous enough that people will read it. So reader beware. Always check who wrote the story, get the scoop on that person and then ask the question – is this person likely to be good reliable source of information on whatever the topic is.

People in corporations have memory. Then why is it that employees with impeccable track records of sound performance and numerous cases of performance above and beyond the call of duty, get laid off? Did someone forget what the employees did? When employees put in that extra effort, yes, it is partly because they have pride in their work and believe that their performance reflects on themselves and gives them a sense of value. But for most of them, not all this work is strictly altruistic. They also hope that those that matter – managers, etc., will recognize the great and/or extra work and will take that into account  when considering promotions, raises and who gets the axe when times are tough.

However, in most corporations, those managers, the memory that matters, change quickly.  And when they do, all those hard earned accomplishments are very quickly forgotten. The memory is lost. How else do you explain employees whose work has exceeded all expectations, who receive awards in recognition of their excellence, but end up being laid off within a year of getting that acclaim? The people they tried to impress are gone. And feeling good about yourself only goes so far when one no longer has a job. And when the only objective is short term share value maximization, a life of service to a corporation is quickly sacrificed for share value.

I have seen excellent employees have to fight over and over to impress their ever-changing managers. In any corporate department there is a general sense of who the performers are. Yet there is no structural mechanism in place to note the achievements and on-going excellence and ensure that this information is front and center whenever management changes.

This is just part and parcel of the malaise of many modern corporations run by MBAs who don’t know the business and management which is only rewarded on the basis of increasing shareholder value. Corporations have no memory, and more and more they have no sense of obligation to employees who give up their lives, other than through the payment of the  most minimal wages they can get away with.

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I have been pondering this question of late. At every company I have worked for the constant mantra has been “increase shareholder value”. I understand the logic behind this. In publicly traded companies, the owners are shareholders. Shareholders invest in companies because they expect to obtain some reasonable return on their investment. Otherwise, why would they have invested their hard earned dollars to start with?

Many of the large shareholders in today’s corporations are pension fund managers. Their investments represent years of toil and sweat on the part of the workers who invested in the pension funds so that they would have some hope of a reasonable retirement income. I get this.

But what I don’t get is the brain dead response of so many senior managers to cut operating costs as soon as economic prospects dim. Cut operating costs? The fact that you can do this and still maintain the corporation as a viable entity means that the company has not been an efficient entity for, probably, years. If it is possible to run the company with 5 or 10 of 20 or more percent less operating costs suggests that the senior management that allowed the company to be run that inefficiently should be fired on the spot, no questions asked, for gross incompetence.

Further, is senior management so plain stupid these days that the only response they have when times are tough is to cut costs – i.e. fire employees? I can train a chimpanzee to walk into the head offices of a company and have it wave its arms and thump the desk to indicate by how many percentage points costs should be reduced! But this is the only response I see these days. Mentally deficient managers yell “off with their heads” and are treated as brilliant visionaries!

The other side of the coin is what can a company do to make its products/services more competitive, desirable, and worth a premium price compared to the competition? In many instances where companies have simply tried to reduce costs, the root cause is a senior management level filled with incompetents who just don’t understand how to move the company forward, how to improve the products and services and how to beat the competition. They too should be fired on the sport for gross incompetence.

This brings us to the other side of the equation. When operating costs are cut, who suffers? Inevitably it is the employees who spend the major part of every day devoting their lives to the company. When you start considering the blood sweat and tears that so many workers have given to a company, over so many years, can you simply say that you are willing, with clear conscience, and no remorse, to fire some large numbers, all in the interest of increasing shareholder value? Is an additional 1% return worth the lives of sometimes thousands of workers? Would the ordinary people who invested in a pension fund, if asked, agree to the termination of these workers so that they could get an extra 1%? I don’t know. But it is a question that I think we need to ask.

And the sad part is that the brain dead managers who can only yell “off with their heads” inevitably leave before the consequences of the cost reductions are felt. If truly justified, as I noted earlier, any managers who allowed the company to get into that state should be fired on the spot. In the many cases where “off with their heads” is a substitute for any resemblance of intelligence, the consequences for these moronic decisions should follow the perpetrators.

Their are many forums on the internet where the performance of professionals such as doctors and teachers and others is reviewed by people who have been subjected to their attention. Bad previous treatments don’t go away, they are recorded and considered whenever someone wishes to determine whether to use their services. The same report card method should be implemented for senior management. Their track records need to be recorded and considered at every company they apply to. Decades of bad decisions and mistreatment of employees cannot and should not be ignored. Inevitably these people move to another company before the true implications of their bad decisions become obvious. Today many of these appointments are made despite shockingly bad track records because either the implications of their previous decisions are not considered or not made known, or because the selection process simply involves hiring one’s friends. This is all too common because incompetence breeds incomptence and this seems to be the prevalent modus operandi for senior management hiring practices.

So, I repeat my question, how many employees is a 1% increase in return on investment worth? More seriously, how can we even ask this type of question? There is something seriously wrong with our society.

There was an article in the press today about a 12 year old Yemeni girl who died of internal bleeding resulting from intercourse with her husband!!

The article went on to say there were efforts in Yemen to institute a minimum age for marriage, but these efforts were being resisted by “conservative parliamentarians”!!!

Hello?

Conservative Parliamentarians?

Call a spade a spade. The efforts to eliminate this practice are being resisted by pedophiles in government. Much like abusive clergy – they find protection in an institution that does nothing to prevent their pedophile tendencies. Of course they resist! Take away their right to have sex with 12 year old girls?

On what planet does the press label this disgusting, totally abusive behaviour, “conservative parliamentarianism”

Call a spade a spade – pedophiles in the Yemeni government don’t want their favourite perversion taken away.

Larger picture – what are other nations doing to sanction any country that institutionalizes pedophilia?
(Similarly, what are nations doing to sanction any organized religion that does not report this type of behaviour to the appropriate authorities for immediate handling through the police/court system?)

There seems to be a predilection in the press to talk about Sr. Mgmt salaries as in some way linked to the job title. I never see a discussion of these salaries in terms of the actual contributions of the people occupying the positions and the value added they provide to the corporations they work for.

I think it is time to evaluate the salaries paid to Sr. Managers in the same terms as they are evaluated for everyone else in the organization – what value does the individual add to the corporation?

After spending many decades in large corporations, I must say that it is extremely rare that I see a Sr. Manager contributing to the corporation at anywhere near the scale that would be necessary to justify their salary.

Like more normal humans they come in, have a coffee or breakfast, read news and reports, talk to subordinates, attend meetings, submit plans produced in most part by their subordinates, etc. In other words, it is not that most of them do nothing, but I have to scratch my head when it comes to pointing out which unique decisions or choices they make which materially improve the financial well being of the organization, justify their outrageous salaries, and differentiate them from much less paid subordinates. In most cases they could disappear entirely and no one would ever notice – because the bulk of the work is being performed by their underlings.

When new and innovative decisions are made – it is not as if these are new and innovative in the context of the organization. Inevitably these are ideas that have been floating around for years, but no one has had the political backing or force of personality to make the changes.

Yet, once a person enters the Sr Manager inner circle and has acquired the appropriate title – this in itself seems to provide entry to those same ranks in other corporations – irrespective of the individuals’ actual performance or contribution. To get into the inner circle requires a mentor or some form of support from within the inner circle. So, to a large extent, the inner circle is a self-perpetuating group of mediocre individuals, in large part, who have essentially “lucked out” in entering the inner circle, and have a vested interest in ensuring the group’s survival and prervailing mediocre performance. Hiring truly brilliant people with clear track records of performance and contribution would, of course, highlight their own mediocrity.

So, next time the press talks about Chief Whatever Officer salaries, they should take a moment to reflect and evaluate the person’s track record at previous institutions, and what true value these people have contributed.