Airbus CEO must be laughing

[Serge914]

Boeing has ordered its Chief Executive Harry Stonecipher to step down because of what the U.S. aircraft giant said was an improper relationship with a female executive.

Does it make sense ? you can have extramarital relationship if you are President but not as a CEO of a big company.

[widebody911]

But if he'd broken into the Cessna plant and taken all their fuel and motor oil, he'd be hailed as a hero.

[Jeff Higgins]

I think they just wanted him gone. Hell, we all wanted him gone. He was seen around here as the "great dismantler". He tore this company down from a position of greatness and leadership to one of mediocrity. He was not a builder or a risk taker like his predecessors. He excelled at selling off technology, manufacturing capacity, and real estate. All in the name of very short-term bottom line and to hell with the future. Many of us that have been around here for some time are quite worried about the future of the company and our ability to continue to build what we already have, much less continue to innovate and develop new technologies and products. Good by and good riddance; may the recovery begin.

[on-ramp]

Clinton was impeached.

[lendaddy]

Originally posted by on-ramp
Clinton was impeached.

True, but we all learned that that means nothing. What happens in the private sector should not determine what we expect from our leaders. The ONLY reason Clinton was not removed from office is that the economy was rolling and most people just assume he was at the wheel. If times had been tough he would have been out on his ear. Bleee dat

We have selective morality, no doubt.

[legion]

Originally posted by Jeff Higgins
All in the name of very short-term bottom line and to hell with the future. Many of us that have been around here for some time are quite worried about the future of the company and our ability to continue to build what we already have, much less continue to innovate and develop new technologies and products.

This is what I see as a fundamental problem with publicly-held companies--especially since the big stock bubble burst a few years ago. Wall Street will not tolerate a company that takes a loss for a quarter, a year, or even a few years so that it can invest in the future and ensure its own viability. Investors have gone from being far too risky (think 1999) to far too risk-averse.

It always irritates me when companies announce massive layoffs. Yes, some companies are overstaffed. Most are sacrificing the futures of their companies to make this quarter's numbers though.

I remember when Boeing went shopping for a new headquarters (read: more subsidies). I couldn't believe how King Richard II rolled out the red carpet for what amounted to 400 jobs. Further, how could Chicago be viewed as "aviation friendly" after the Meiggs field fiasco?

[Drago]

Jeff's got it right.

[stevepaa]

Is the lifting of the ban on Government contracts, from using Lockheed documents, part of this deal? I'm at Lockheed and personally hope this makes Boeing a better place.

[Drago]

Originally posted by stevepaa
Is the lifting of the ban on Government contracts, from using Lockheed documents, part of this deal? I'm at Lockheed and personally hope this makes Boeing a better place.

The lifting of the ban on Government contracts happened last week. It took the Boeing board 8 days to decide what to do with Harry. Coincidence?

[IROC]

As a Boeing employee, I have mixed feelings about this whole thing. I have met Harry on more than one occasion (we actually graduated from the same college) and I have to say that I have alot of respect for the guy - other than selling out us former McDonnell Douglas folks...

He was brought back out of retirement to lead Boeing out of the mess we were in a couple of years ago (the whole Lockheed Martin EELV fiasco and to replace Phil Condit who had waaaay too many skeletons in his closet). Then he goes and puts himself in a position to further embarass the company. I don't get that part at all.

I have a feeling that alot of companies have this sort of stuff going on also - it just doesn't get publicized like it does at Boeing.

Mike

[kach22i]

Airbus CEO must be laughing

The CEO of Air Bus could be a bi-sexual cheating whore, but if he did his job well most of the European community could care less about his sexual antics.

Such is the difference between Puritan America and our friends across the pond.

[IROC]

Originally posted by kach22i
The CEO of Air Bus could be a bi-sexual cheating whore, but if he did his job well most of the European community could care less about his sexual antics.

Such is the difference between Puritan America and our friends across the pond.

I violently agree. :>)

[competentone]

I've heard a lot of talk about it, but haven't heard anyone say whether or not Harry Stonecipher is married.

If he is married, doesn't his affair represent a breach of the contract he has with his wife (most marriages assume fidelity)? Doesn't his affair say something about his character? Aren’t character issues in the CEO something the Board of Directors should consider?

[Drago]

Originally posted by competentone
I've heard a lot of talk about it, but haven't heard anyone say whether or not Harry Stonecipher is married.

Yes, he's married...to the same woman for ~40 years.

Local news stations, as well as Boeing spokespersons, have stated that the affair wasn't the only reason for the board ask for his resignation.

The other reason(s)? They won't give any specifics.

[legion]

More about the absence of long-term focus at US companies:


When Meeting Targets Becomes the Strategy, CEO Is on Wrong Path
NEW YORK (The Wall Street Journal)--The vice president of sales at a Silicon Valley technology company was on his hour-long commute home one evening last week when his boss called his cellphone. "Did you make your numbers today?" the boss asked. Before the vice president could respond, his boss continued, "And by the way, you're going to have to make more cuts."

Richard Hagberg, an organizational psychologist, recounted the conversation after meeting with the man later that night and listening to him vent about his job. "He's under enormous pressure to meet certain sales and profit targets on a daily basis now, and often the only way to do that is to keep cutting people and resources," says Mr. Hagberg, founder of Hagberg Consulting Group. The vice president, who supervises about 200 people, spends all his time on "day-to-day tactical stuff and trying to get more work out of fewer people," Mr. Hagberg says. The executive knows his company needs to streamline its product line and figure out ways to better compete against a bigger, more efficient rival. "But in the climate he's in, there's no time" to plan for the future, Mr. Hagberg says.

Global competition has never been fiercer, but investors still want ever higher returns. And CEOs know their jobs and compensation packages depend on delivering. So at many companies managers down the ranks are being given targets that can be met only by steep cost cutting.

BUT SUCH an approach can easily backfire. For one thing, employee loyalty and teamwork erode quickly, along with innovation and risk taking. So, in some cases, do business ethics. Managers and employees who fear they'll lose their jobs if they don't deliver their assigned numbers are more inclined to fudge results.

And companies that become fixated on hitting quarterly and even daily targets often don't produce sustainable profit growth. "It's hard to capture employees' hearts, and best efforts, with numbers alone," says Mr. Hagberg. In a recent study of 31 corporations, his staff found that the highest returns were achieved at companies whose CEOs set challenging financial goals but also articulated a purpose beyond profit making, such as creating a great product, and convinced employees their work mattered.

Susan Annunzio, CEO of the Hudson Highland Center for High Performance in Chicago, found that the biggest impediment to high performance -- which she defined as making money for the company and developing new products, services and markets -- is short-term focus. She and her staff spent all of 2003 researching 3,000 managers and knowledge workers at such global companies as Microsoft, Intel and J.P. Morgan Chase. Just 10% said they worked in high-performing groups, and 38% said they worked in "nonperforming groups." But almost one-third of the nonperformers said their businesses used to be high performing. "We asked what had happened, and a lot of them said `top management raised our targets, cut our budgets and staff, and we couldn't sustain results,' " Ms. Annunzio says.

A REGIONAL MANAGER at an advertising agency told Ms. Annunzio how this happened at his highly profitable unit after the agency was acquired by a bigger global concern. His new boss first cut frills like Christmas parties and office plants, but then moved on to training budgets and staff. "So the most talented staff found new jobs, took clients with them and then there were more cuts," Ms. Annunzio says. After about a year, the regional manager figured the best thing he could do was meet his boss's targets by eliminating his position and walking away with a severance package. "He and his team were the best thing the acquiring company had purchased, and they destroyed it," Ms. Annunzio says.

A manager at a Dallas-based IT company who didn't want to be named for fear of jeopardizing his job -- a concern cited by many of the managers I talked to -- says he has seen some operating costs rise following the layoff of some talented and experienced employees. When his company outsourced its computer-support staff to India, it laid off an employee "who'd saved us tens of thousands of dollars when our hard drive crashed," the manager says. "The help desk said, `Sorry, you lost everything,' the computer manufacturer said the same, and this guy, who was earning a smidgeon of what he saved, recovered it all. We don't have anyone nearly as talented to turn to now," he adds.

Other managers who meet targets fear that in the long run they'll be punished more than rewarded. When a plant manager at a manufacturing company was told to shave operating costs, he knew he could meet the target within a month by changing some production procedures, says Ms. Annunzio, who interviewed him for her study. But he worried that his bosses would then raise the bar to a level he couldn't meet, and he wouldn't get a raise at the end of the year. So he parceled out the cuts over 12 months.

What to do? Ms. Annunzio says more CEOs have to "have the guts to stand up to the investment community and tell them companies can't cut their way to sustainable profit growth." Instead, she says, they should differentiate their products and seize opportunities in new markets -- and value the employees who help them do it.

My best friend's mother used to work for Lucent. She was an engineer and 30-year veteran who had started there when it was still called "Bell labs". One day in 1999 (if I recall correctly), upper management got the bright idea that it would save massive costs if they layed off all of the experienced employees. A recent college graduate can work as effectively as a 30-year veteran, right? Several rounds of layoffs later, Lucent is a strong and vibrant company, right? The approach a lot of corporate management today is taking is akin to removing the motor and transmission from your track car to save weight...

[widebody911]

Then again, a CEO can run a company into the ground and still punch out with a nice golden parachute. Case in point: Carly Fiorina and HP; she got ~$21M not including her stock, and you really can't point to anything positive she did while she was at the helm.

[Jeff Higgins]

Originally posted by widebody911
Then again, a CEO can run a company into the ground and still punch out with a nice golden parachute. Case in point: Carly Fiorina and HP; she got ~$21M not including her stock, and you really can't point to anything positive she did while she was at the helm.

Yeah, pretty much standard operating procedure in the corporate world these days. The revolving door CEO's, and even lower level execs, rarely stay in a position long enough to reap the rewards of their good judgement or pay the penalty for their bad. I'm not talking the short term gains that wind up as bullets on their resume's, but the long term consequences that the rest of us are left to pick up after. The boardrooms at that level have become so inbred that they have no difficulty voting each other huge bonuses from company to company. "You scratch my back at IBM and I'll scratch yours at GE" is kind of the way it seems to work.

[350HP930]

They are not much different than their minions in government.

[RickM]

Here's who he went down for: http://www.thesun.co.uk/article/0,,2-2005111820,00.html

[stevepaa]

So if we all see the short term gain mentality is a buch of cr#p, why do many still support the call to privatization. Wouldn't that be jumping from the pot into the fire.