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Dunking on MBAs, while deserved, feels like a distraction to the core problem: Short-termism. Incentives in almost all US businesses are based around quarterly

Dunking on MBAs, while deserved, feels like a distraction to the core problem: Short-termism. Incentives in almost all US businesses are based around quarterly/annual outcomes, and even more so are almost legally required to for public companies. This results in a breed of manager who wants to get in, pump, and dump. Hiring from a within via long term employees should be seen as a value signal, but instead professional traders prefer external hires because their track-record is public, and can be more easily quantified. This creates a small number of CTO-tier hires who rotate endlessly through corporate entities making ever more obscene incomes, and often leaving a mess behind them.

ford 5y ago
An interesting attempt to address this idea (albeit with not much traction and thus questionable benefit) - the long term stock exchange: https://ltse.com/about https://ltse.com/about
g_p 5y ago
I wonder if there's a way to structure exec level employee incentives through accruing bonuses over longer periods of time, so that you get two impacts: 1. Bad managers who get "found out" in the longer term don't apply for the role, as they won't be getting their bonus for stripping assets into a sell-and-lease-back, as their bonus will eat itself when the company starts to spiral downwards in a year or two. 2. Those who become bad managers get seen for what they are, and can't as easily "job hop" to escape the crisis they've caused. This tarnishes their reputation, warning others, and any exec jumping early will be viewed with suspicion. In theory you could argue for stock options or similar, but those seem to deliver the short term behaviours that cause the issues in the first place (selling tangible things to raise dividends, to raise the share price, then discover you need to borrow money as you spent it all on renting the things you used to own).

ford 5y ago

An interesting attempt to address this idea (albeit with not much traction and thus questionable benefit) - the long term stock exchange: https://ltse.com/about https://ltse.com/about

g_p 5y ago

I wonder if there's a way to structure exec level employee incentives through accruing bonuses over longer periods of time, so that you get two impacts: 1. Bad managers who get "found out" in the longer term don't apply for the role, as they won't be getting their bonus for stripping assets into a sell-and-lease-back, as their bonus will eat itself when the company starts to spiral downwards in a year or two. 2. Those who become bad managers get seen for what they are, and can't as easily "job hop" to escape the crisis they've caused. This tarnishes their reputation, warning others, and any exec jumping early will be viewed with suspicion. In theory you could argue for stock options or similar, but those seem to deliver the short term behaviours that cause the issues in the first place (selling tangible things to raise dividends, to raise the share price, then discover you need to borrow money as you spent it all on renting the things you used to own).