5 ms·

Ayn Rand-loving CEO destroys his empire

20 points by rosser 13y ago

Pinatubo 13y ago
This article was actually written by someone from Alternet, which is why it obsessively mentions Ayn Rand in every paragraph and contains so much over the top invective. I'm not sure it's a good idea for a more reputable media brand like Salon to host articles like this, but it seems to be a trend -- Forbes for instance allows "guest bloggers" to post content that can sometimes be as unhinged as this piece.
- deleted 13y ago
  [deleted]
guylhem 13y ago
Why exactly is there "Ayn Rand" in the title? If you still are not shocked, let's color the phrase a bit more : "Is it really necessary for liberals to bash values they don't agree with, while hiding their own shortcomings ?" There, you are shocked - but you can find additional food for though on http://econlog.econlib.org/archives/2013/12/media_bias_case.html http://econlog.econlib.org/archives/2013/12/media_bias_case.... http://econlog.econlib.org/archives/2013/12/denver_posts_me.html http://econlog.econlib.org/archives/2013/12/denver_posts_me.... Besides this "Colorado school shooter was an hardcore leftist and keynesian" (shocking headline selected for additional emotional impact) this is not what I often see in the news http://dailycaller.com/2013/12/14/dead-colorado-school-shooter-was-hardcore-leftist-keynesian/ http://dailycaller.com/2013/12/14/dead-colorado-school-shoot... But I guess if the guy had believe in objectivism and had been right wing, this would have justified headlines and a totally different wording - like this article on Salon. Ask yourself- why is it ok to do ad-hominem attack on one case, and not in the other? Why are you shocked when the headlines mention the political beliefs that you find totally normal, but you are not when the headlines mention Ayn Rand? Besides the shocking title, the content is awful. This article has nothing to do on HN. If downvoting this is easy, but explaining your disagreement is harder, my suggestion: bias at work.
- deleted 13y ago
  [deleted]
Pxtl 13y ago
To be fair, Sears was setting off alarm-bells for being mismanaged and myopic before he took charge. But he obviously didn't help.
- Turing_Machine 13y ago
  Sears was doomed when they scrapped their catalog operation, coincidentally the same year that the first graphical web browser was introduced. At one time Sears sold EVERYTHING, from a replacement zipper to a full precut and ready to nail together house. They basically had Amazon.com -- suppliers, warehouses, nationwide distribution network -- plus a brick and mortar outlet in every town of any size, and threw it all away.
  - Pxtl 13y ago
    I know. Like I said, mismanaged and myopic. They were the Amazon of their day, and they completely missed the boat on the Internet.
jere 13y ago
Sorry, but I was far more interested by an irrelevant detail I read in a more detailed article about Lampert: he was kidnapped in 2003. http://www.businessweek.com/articles/2013-07-11/at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-troubles http://www.businessweek.com/articles/2013-07-11/at-sears-edd... >His notoriety grew in the early 2000s, when he launched a takeover of bankrupt retailer Kmart. During negotiations, Lampert was kidnapped from a parking garage in Greenwich, Conn., and held for two days... http://usatoday30.usatoday.com/money/industries/retail/2004-05-17-kmart-kidnapper_x.htm http://usatoday30.usatoday.com/money/industries/retail/2004-... >In exchange for his release, Lampert agreed to stash $40,000 in a garbage can outside a Wendy's restaurant in Greenwich, prosecutors said. The money was never paid. Instead, the FBI took up the case. They found that an associate of the kidnappers had used a stolen credit card to order a pizza delivery.
thucydides 13y ago
This article is fairly tendentious, but the story itself is interesting and was well-covered in a Bloomberg Businessweek article here: http://www.businessweek.com/articles/2013-07-11/at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-trouble http://www.businessweek.com/articles/2013-07-11/at-sears-edd... I'm not a Rand disciple, but organizational experimentation like what Eddie Lampert did is a good thing, even though it's been a failure in this case. We know so little about human organizations generally, and so few have been tried, that it borders on insanity to argue that the large business corporation, a form that has existed for only a couple centuries, has been perfected. Specifically, they nearly always have a CEO on top who has the power and trappings of an absolute monarch issuing orders to courtesans, who do the work or delegate the work to lieutenants, who do the work or delegate to lieutenants, etc. Are we so unimaginative that we think this is the SOLE way of doing things? Consider, for example, Valve's success with their novel organizational structure, what Michael Church calls "open allocation."
- r00fus 13y ago
  > We know so little about human organizations generally, and so few have been tried, that it borders on insanity to argue that the large business corporation, a form that has existed for only a couple centuries, has been perfected. This is hardly a valid rationale for saying that what Lampert did was a good thing. Unless you're going by the "fail upwards" strategy. The embodiment of an ideal is only as good as it's execution. Lampert's was clearly a failure. How can you call what he did as "good"? At best he was attempting a Sisyphean task (Merging Kmart and Sears), but then again, that was his idea as well. Ultimately, I fail to even see that Lampert was punished for his failure - nothing in the article says that this corporate raider didn't do exactly what he intended - i.e., to profit by the destruction of companies.
  - thucydides 13y ago
    Unless we have good reason to believe the standard CEO-as-monarch structure is perfect, experimentation is a good thing. Moreover, his basis for suspecting his particular experiment might work was reasonable, since he was basically applying by analogy a standard neoclassical model of how a market at large works to his individual business. Before he implemented the structure, would I have expected it to fail? Yes, but I expect most start-up ideas to fail, too. You never know. We can't forget that we learn as well from negative results as from positive results. Solid analysis of Lampert's failure here helps all of us, because we can see a little bit better what pitfalls to avoid in our own organizational structures. Admittedly, however, it is probably unwise to play radical, untested games with the fundamental structure of a large and mature business, only because the losses can be so much larger and more catastrophic. Better to test the idea in a small or medium-sized business first. But it's a good thing for people to experiment generally, and we learned here nonetheless. It would be unfortunate if the only lesson future business leaders took from this episode is never to deviate from the monarchical model of corporate governance.
holograham 13y ago
Most of these cited failures have no root in Ayn Rand ideology whatsoever. Selling rolexes at Sears is not a smart free market idea. Not sure the details of how he "pitted" company managers against each other but he perhaps did do an experiment in human organization theory that failed. Free market ideology is not about pitting one manager against another...it is about measuring how much value the market (consumers) get from a given manager. It sounds like this guy was anything but a free market advocate. Manipulating stock prices through accounting gimmicks is NOT the basis of a free market enterprise. The free market enterprise is always valued against how much wealth the market willingly agrees to part with in exchange for even greater value.
- deleted 13y ago
  [deleted]
omonra 13y ago
Articles like these make me wish that HN had a black-list of sites that only publish partisan politicized crap journalism (regardless of actual brand of ideology preached). If they make a conscious decision to push one-way propaganda, they should not be linked to in polite company.

20 points by rosser 13y ago

This article was actually written by someone from Alternet, which is why it obsessively mentions Ayn Rand in every paragraph and contains so much over the top invective. I'm not sure it's a good idea for a more reputable media brand like Salon to host articles like this, but it seems to be a trend -- Forbes for instance allows "guest bloggers" to post content that can sometimes be as unhinged as this piece.

deleted 13y ago
[deleted]

guylhem 13y ago

Why exactly is there "Ayn Rand" in the title? If you still are not shocked, let's color the phrase a bit more : "Is it really necessary for liberals to bash values they don't agree with, while hiding their own shortcomings ?" There, you are shocked - but you can find additional food for though on http://econlog.econlib.org/archives/2013/12/media_bias_case.html http://econlog.econlib.org/archives/2013/12/media_bias_case.... http://econlog.econlib.org/archives/2013/12/denver_posts_me.html http://econlog.econlib.org/archives/2013/12/denver_posts_me.... Besides this "Colorado school shooter was an hardcore leftist and keynesian" (shocking headline selected for additional emotional impact) this is not what I often see in the news http://dailycaller.com/2013/12/14/dead-colorado-school-shooter-was-hardcore-leftist-keynesian/ http://dailycaller.com/2013/12/14/dead-colorado-school-shoot... But I guess if the guy had believe in objectivism and had been right wing, this would have justified headlines and a totally different wording - like this article on Salon. Ask yourself- why is it ok to do ad-hominem attack on one case, and not in the other? Why are you shocked when the headlines mention the political beliefs that you find totally normal, but you are not when the headlines mention Ayn Rand? Besides the shocking title, the content is awful. This article has nothing to do on HN. If downvoting this is easy, but explaining your disagreement is harder, my suggestion: bias at work.

deleted 13y ago
[deleted]

Pxtl 13y ago

To be fair, Sears was setting off alarm-bells for being mismanaged and myopic before he took charge. But he obviously didn't help.

Turing_Machine 13y ago
Sears was doomed when they scrapped their catalog operation, coincidentally the same year that the first graphical web browser was introduced. At one time Sears sold EVERYTHING, from a replacement zipper to a full precut and ready to nail together house. They basically had Amazon.com -- suppliers, warehouses, nationwide distribution network -- plus a brick and mortar outlet in every town of any size, and threw it all away.
- Pxtl 13y ago
  I know. Like I said, mismanaged and myopic. They were the Amazon of their day, and they completely missed the boat on the Internet.

jere 13y ago

Sorry, but I was far more interested by an irrelevant detail I read in a more detailed article about Lampert: he was kidnapped in 2003. http://www.businessweek.com/articles/2013-07-11/at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-troubles http://www.businessweek.com/articles/2013-07-11/at-sears-edd... >His notoriety grew in the early 2000s, when he launched a takeover of bankrupt retailer Kmart. During negotiations, Lampert was kidnapped from a parking garage in Greenwich, Conn., and held for two days... http://usatoday30.usatoday.com/money/industries/retail/2004-05-17-kmart-kidnapper_x.htm http://usatoday30.usatoday.com/money/industries/retail/2004-... >In exchange for his release, Lampert agreed to stash $40,000 in a garbage can outside a Wendy's restaurant in Greenwich, prosecutors said. The money was never paid. Instead, the FBI took up the case. They found that an associate of the kidnappers had used a stolen credit card to order a pizza delivery.

thucydides 13y ago

This article is fairly tendentious, but the story itself is interesting and was well-covered in a Bloomberg Businessweek article here: http://www.businessweek.com/articles/2013-07-11/at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-trouble http://www.businessweek.com/articles/2013-07-11/at-sears-edd... I'm not a Rand disciple, but organizational experimentation like what Eddie Lampert did is a good thing, even though it's been a failure in this case. We know so little about human organizations generally, and so few have been tried, that it borders on insanity to argue that the large business corporation, a form that has existed for only a couple centuries, has been perfected. Specifically, they nearly always have a CEO on top who has the power and trappings of an absolute monarch issuing orders to courtesans, who do the work or delegate the work to lieutenants, who do the work or delegate to lieutenants, etc. Are we so unimaginative that we think this is the SOLE way of doing things? Consider, for example, Valve's success with their novel organizational structure, what Michael Church calls "open allocation."

r00fus 13y ago
> We know so little about human organizations generally, and so few have been tried, that it borders on insanity to argue that the large business corporation, a form that has existed for only a couple centuries, has been perfected. This is hardly a valid rationale for saying that what Lampert did was a good thing. Unless you're going by the "fail upwards" strategy. The embodiment of an ideal is only as good as it's execution. Lampert's was clearly a failure. How can you call what he did as "good"? At best he was attempting a Sisyphean task (Merging Kmart and Sears), but then again, that was his idea as well. Ultimately, I fail to even see that Lampert was punished for his failure - nothing in the article says that this corporate raider didn't do exactly what he intended - i.e., to profit by the destruction of companies.
- thucydides 13y ago
  Unless we have good reason to believe the standard CEO-as-monarch structure is perfect, experimentation is a good thing. Moreover, his basis for suspecting his particular experiment might work was reasonable, since he was basically applying by analogy a standard neoclassical model of how a market at large works to his individual business. Before he implemented the structure, would I have expected it to fail? Yes, but I expect most start-up ideas to fail, too. You never know. We can't forget that we learn as well from negative results as from positive results. Solid analysis of Lampert's failure here helps all of us, because we can see a little bit better what pitfalls to avoid in our own organizational structures. Admittedly, however, it is probably unwise to play radical, untested games with the fundamental structure of a large and mature business, only because the losses can be so much larger and more catastrophic. Better to test the idea in a small or medium-sized business first. But it's a good thing for people to experiment generally, and we learned here nonetheless. It would be unfortunate if the only lesson future business leaders took from this episode is never to deviate from the monarchical model of corporate governance.

holograham 13y ago

Most of these cited failures have no root in Ayn Rand ideology whatsoever. Selling rolexes at Sears is not a smart free market idea. Not sure the details of how he "pitted" company managers against each other but he perhaps did do an experiment in human organization theory that failed. Free market ideology is not about pitting one manager against another...it is about measuring how much value the market (consumers) get from a given manager. It sounds like this guy was anything but a free market advocate. Manipulating stock prices through accounting gimmicks is NOT the basis of a free market enterprise. The free market enterprise is always valued against how much wealth the market willingly agrees to part with in exchange for even greater value.

deleted 13y ago
[deleted]

omonra 13y ago

Articles like these make me wish that HN had a black-list of sites that only publish partisan politicized crap journalism (regardless of actual brand of ideology preached). If they make a conscious decision to push one-way propaganda, they should not be linked to in polite company.