It's a pity that the first announcement from ST-Ericsson under its new CEO Gilles Delfassy is an announcement of job cuts.
Unfortunately, nowadays, that is often the way new CEOs seem to think is an appropriate way to impress themselves on their new companies.
How much better would it be if new CEOs looked for new markets, new technologies, new opportunities and new vision.
That would energise a new company, and it would incentivise the CEO because his balls would be on the line if his new direction lacked success.
But how many CEOs put their balls on the line these days?
They're usually too scared of the shareholders, too wedded to their compensation packages, to do anything other than massage the numbers to please Wall Street.
If that means blighting the lives of hundreds of people - so be it - the CEO is going to get a comfortable retirement out of it.
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Comments (5)
Another import from the finance industry.
Whenever a new CEO takes over in finance item 1 is a redundancy programme. Invariably puts a big -ve onto the exceptional items of accounts, but these finance guys don't worry about exceptional items.
I think they do it because it is the only chance they will get without a tacit admission that they've not been doing the best job. The logic goes that redundancies when you start out are obviously due to the mismanagement of the previous regime. Once you've been in the job a year or so (or 100 days if we're American) any cuts must be because the new CEO has cocked things up. Never mind that external factors like a world recession might be to blame - the alpha male masters of the universe tell each other they can see these things coming (after the fact of course) so that's no excuse.
By observing the finance industry the general run of things is that there are big lay-offs when the new guy starts, on very favourable terms. Then over the next six months they hire contractors like billy-oh at a premium to cover the shortfall in effort. Someone in upper middle management then spots that costs could be cut by turning contractors into staff, and we are back where we started minus a lot of redundancy payments, having put a lot of people through horrible and unnecessary stress.
Posted by Stooriefit | December 9, 2009 8:42 AM
Posted on December 9, 2009 08:42
I agree, Stooriefit, it's a kind of knee-jerk reaction for the new CEO to announce sackings before he's even had time to do a proper review of the company, or decide a strategy or even to focus on the products and markets he's going for. It sends a signal to the shareholders that he's on their side - and a signal to the engineers that he's not on their side. It's a really shocking way to start - but only too common these days.
Posted by David Manners
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December 9, 2009 10:31 AM
Posted on December 9, 2009 10:31
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Posted by Joyce S. Crawford | December 10, 2009 7:35 PM
Posted on December 10, 2009 19:35
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Posted by David Manners
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December 10, 2009 10:52 PM
Posted on December 10, 2009 22:52
spammer Joyce needs to go as well!!
Posted by chendsign | December 15, 2009 1:06 PM
Posted on December 15, 2009 13:06