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There’s plenty of mismanagement and failing up that goes on at the expense of the workers, but the rationale is like this: In the general case, from the compan
by ip26 4y ago
There’s plenty of mismanagement and failing up that goes on at the expense of the workers, but the rationale is like this:
In the general case, from the company perspective, the layoffs have to happen to keep the company healthy. Regardless why it has reached this point.
When it comes to the CEO, they are admitting fault to the board, but the board is choosing to retain them, perhaps feeling the incumbent CEO may be best situated to right the company.
My assumption is that the consequences come when it happens a second time and the board says “enough, you’re finished”
- dasil003 4y agoThis is a good summary. We don’t fire workers just because they made a mistake. It’s not even really a moral stance, it’s that turnover has overhead and risks that have to be justified, and those are particularly for a CEO. It might feel like vindication for a CEO to be fired due to the necessity of layoffs, but on the other hand a CEO who did not overhire to maximize growth in the boom times could just as likely be fired by the board for failure to capitalize on the bull market.
- mitthrowaway2 4y agoWe don't fire workers just because they made a mistake. But we also don't offer those workers $20,000,000 compensation packages because company performance hinges so critically on incentivizing these rare few individuals who are capable of... coasting with the tide along with everyone else?
- dasil003 4y agoNot sure where coasting comes in. Hiring during the boom and laying off during the downturn may be exactly what shareholders want. It's up to the board to decide how the CEO is performing. This is incredibly hard to evaluate, but it's clear that CEO choice matters, thus the market rate has ticked up for CEO salaries. We may find it morally abhorrent, but it's important to understand what's going on. The business world does not start from the axiom that layoffs are always the result of management failure.
- mitthrowaway2 4y ago> The business world does not start from the axiom that layoffs are always the result of management failure. So a CEO "taking full responsibility" is what, a claim of success?
- dasil003 4y agoNo, it's just a platitude. The true assessment is not a binary proposition though, and it's not going to come out directly in a memo or PR, you have to read between the lines a bit. Consider the difference between John Foley and Andy Jassy's performance.
- rchaud 4y agoAs soon as someone takes the mantle of CEO, they become politician first and leader second. > My assumption is that the consequences come when it happens a second time and the board says “enough, you’re finished” This is precisely why many boards are rigged with yes-people. It provides the illusion of accountability.