[QUOTE=xtisme]
Why bother attempting to ‘debate’ a subject that you obviously don’t have any clue about AND you have a closed mind on as well then? I don’t get it. 
-XT
[/QUOTE]
Don’t confuse “Does not agree with me” with “don’t have a clue about.” Especially don’t confuse the two and then accuse ME of having a closed mind.
[QUOTE=Evil Captor]
I think a person of average intelligence with a strong crew of managers with good staffs doing research could probably run a corporation quite well. A really strong CEO with a weak staff might not do so well (though a really good one would know enough to replace the weak staff).
[/quote]
How does they guy of “average intelligence” get the “strong crew of managers” to work for him? And why would they stay?
You’re right. So, why don’t you go out into the real world and prove us all wrong. Surely you are at least of average intelligence. Go assemble your “strong crew of managers” and prove us wrong. What’s stopping you (or anyone else of “average intelligence”)? Is “the man” keeping you down?
[QUOTE=Evil Captor]
Many of you seem to be confusing the fact that companies make money sometimes and lose them at others with the fact that they have CEOs. You’re like primitives running around saying, “We can’t depose the preist kings! They make the rain! And they make the river flood!”
Jeebus.
[/QUOTE]
Well, give us an example, then.
There have been a number of good examples of how truly effective managers have enabled huge successes for their companies. Give an example of a company that runs . . . I’m not even sure what or how you’re suggesting a business run, but surely there are other conceivable models.
Show us a business that has no centralized leadership that is essential to company growth and direction. As you and others have said, maintaining the status quo is one thing, but driving a company to grow and thrive is another.
[QUOTE=Evil Captor]
I’m sorry, but this is just so wrong-headed. The notion being brought forth here that everyone at a company like IBM is an empty-headed dummy with no ability to contribute while the CEO embodies all that is wise and good is ridiculous on its face. Everybody contributes. And it’s true, the Deciderer is the one who makes the company’s decisions and that can be critical, but there are people who provide him with data and research and so forth, and there are people in charge of critical areas of the company who keep it humming who are also important. As important as the Deciderer? Probably not. Ants to the Decider’s giant? Certainly not.
[/QUOTE]
Here’s the thing, everybody contributes, but they don’t contribute a cohesive strategy. The guys in Server group contribute “hardware is the key to our business” The guys in Services “Hardware is flat growth, services will grow like crazy.” The PC guys “We can turn it around”. The R&D guys “We can develop industry leading technology.”
There are a hundred people with the CEO’s ear, giving a hundred different possible courses of action. If you think the data will give you one clear course of action, tell me why Ford and GM are crashing and burning while Toyota is growing by leaps and bounds. Why did IBM start failing in the late 80’s- early 90’s, dropping in value 75% and laying off some 100,000 people only to turn around after Lou Gerstner was hired and grow back into a solid company?
A good CEO provides vision and direction for the company. His decisions about what markets to tap, what products to develop, what deals to make and not make, determine the fate of the company.
Within the five ten posts of the thread it was already becoming unclear as to whether the discussion was about mid level managers or executives in large corporations. Which is kind of like confusing janitors with accountants.
I’m an ISO 9001 auditor, so I get the unique experience of working with all levels of a company, at 50-70 different companies a year. Let me tell you something; anyone who thinks good managers and executives aren’t worth their weight in gold is simply ignorant. Honest to Christ, “Dilbert” is not the gospel of how businesses run. The managers are the most important people in a company, especially at the senior manager and director levels. Every company I have ever seen that was doing well had excellent managers, directors and executives, and every company I have ever seen that was not doing well had weaknesses in some of those positions.
Managing looks easy from below. It isn’t.
Besides, “intelligence” is only part of the equation, especially if you mean “IQ”. There are many types of intelligneces besides that which is measured by IQ, and there are also other important characteristics that a good manager must have (especially a senior manager):
And I’m sure the list could go on much further. You might think your boss is stupid, and sometimes you’re probably right. Some guys just stumble into management. But good companies liver or die by the strength of their management. So, yes, I’d say a guy of “average intelligence” can be a senior manager, but he has to be above average in a lot of other things to get there and stay there.
[QUOTE=Least Original User Name Ever]
Huh. And I thought it was a pretty fair question. But really, there’s no debate possible, then.
[/QUOTE]
You misunderstand the nature of debate then. It is very rare that people engaged in a debate completely change the other’s minds. But you can still have a good, useful debate. Both sides can marshall their arguments and present their supporting data to the best of their ability. Maybe people who aren’t so strongly invested in either position will be swayed one way or the other. Or maybe a gradual, subtle change in viewpoint will be created over time.
Frex, I was once all for doing the economic equivalent of taking all the rich guys and hanging them up by their heels and cutting their throats, just to see if they were so all-fired important to the economy as they and their apologists claim. Now, thanks to many arguments with Sam Stone and John Mace and (it feels like) every free-market libertarian on the Dope, I feel that their mansions, yachts, vacations and such are an unimportant blip on the economy. They can keep them. The important thing is to stop them from looting the middle class and the poor. Let the rich get rich, so long as the poor and the middle class get richer, too.
On the other hand, I feel I have helped some libertarians and conservatives see the importance of social safety nets in an economic system which admits to requires 3 or 4 percent employment in order to work efficiently.
While all is harmonic agreement, there has been movement toward the middle.
[QUOTE=Least Original User Name Ever]
Huh. And I thought it was a pretty fair question. But really, there’s no debate possible, then.
[/QUOTE]
You misunderstand the nature of debate then. It is very rare that people engaged in a debate completely change the other’s minds. But you can still have a good, useful debate. Both sides can marshall their arguments and present their supporting data to the best of their ability. Maybe people who aren’t so strongly invested in either position will be swayed one way or the other. Or maybe a gradual, subtle change in viewpoint will be created over time.
Frex, I was once all for doing the economic equivalent of taking all the rich guys and hanging them up by their heels and cutting their throats, just to see if they were so all-fired important to the economy as they and their apologists claim. Now, thanks to many arguments with Sam Stone and John Mace and (it feels like) every free-market libertarian on the Dope, I feel that their mansions, yachts, vacations and such are an unimportant blip on the economy. They can keep them. The important thing is to stop them from looting the middle class and the poor. Let the rich get rich, so long as the poor and the middle class get richer, too.
On the other hand, I feel I have helped some libertarians and conservatives see the importance of social safety nets in an economic system which admits to requires 3 or 4 percent employment in order to work efficiently.
While all is not harmonic agreement, there has been movement toward the middle.
[QUOTE=Evil Captor]
…in an economic system which admits to requires 3 or 4 percent employment in order to work efficiently.
[/QUOTE]
You misunderstand the argument as to why 3% unemployment is essentially the floor. The system doesn’t “require” that, it just generally works out that way even in the best of times. But there’s nothing preventing the unemployment rate from going lower, theoretically, and the economy wouldn’t necessarily suffer if it did.
Not only can a bad exec hurt a company but they do. It s not rare for one of these rarified individuals to screw up. Cheney when he was at (he never left) Haliburton bught a company wth huge asbestoes claims. HE managed to get a bill limiting the size of claims through the Repub congress and Senate. It saved his decision.
Saying they isare in charge of hiring is a joke. Ever hear of Human Resources.
Ford is trying to get small car and alternative fuel info from Toyota. How many of us stupid little people are saying I knew they were stupid keeping SUV s and big vehicles with obvious problems coming in the future. GM is the same. Short term stupidity and every one one this board knew they were screwing up.
[QUOTE=Evil Captor]
I think execs are just glorified clerks, the real decision making is done by the information gatherers, since they’re the ones on the ground floor. Of course, somebody has to have final say, or the department heads will squabble endlessly about whose report should be considered. That’s why I think the exec should be a sort of glorified clerk, paid a very nice salary to decide which reports to endorse and which not to endorse, but not the megabucks CEOs now get.
[/quote]
What decisions? Like your stupid email recomendation to management? A Fortune 500 might have 200,000 employees on the “ground floor”. They might have a thousand departments all over the world. How the hell do you think anything will ever get decided?
The reason companies have layers of management is because a person can only directly “manage” a couple of dozen at a time. Each one manages a couple dozen more and so on. The higher up, the better you need to be at it. It;s like saying any soldier can just go be the general of the army.
Such nonsense.
[QUOTE=Evil Captor]
Don’t confuse “Does not agree with me” with “don’t have a clue about.” Especially don’t confuse the two and then accuse ME of having a closed mind.
[/QUOTE]
But you DON’T have a clue and you DO have a closed mind.
Why don’t just open a Pit or IMHO thread so we don’t have to go through a charade of trying to seriously debate this with you? Your ignorance in these matters is certainly Pit-worthy.
Uhh..other than also having a strong track record in business and leadership, how is that different from what already happens?
For other people interested in the topic:
You know what would happen if there was no management in my company (say we were all taken away in the Rapture, leaving just worker bees)? We would have 1000 employees sitting around idle. Assuming they were still receiving paychecks, they would sit around surfing the net, working on pet projects, grabassing by the water cooler or just working off on random tangents (assuming they had any work to do).
Eventually, they would start to quit, never to be replaced because there would be no one in authority to hire anyone. They would quickly run out of work to do once (if) their current projects finished as most of them wouldn’t have the first clue as to where to get new business from.
Our competetors (well, “theirs” really as I am management) would soon surpass us as the company would no longer have anyone driving innovation. No new service lines would be developed. No infrastructure would be improved, just maintained. Or maybe the IT guys would spend exhorbitant money on infrastructure improvements without anyone to rein them in.
Basically it’s the difference between a professional army and an angry mob.
[QUOTE=Evil Captor]
You misunderstand the nature of debate then. It is very rare that people engaged in a debate completely change the other’s minds. But you can still have a good, useful debate. Both sides can marshall their arguments and present their supporting data to the best of their ability. Maybe people who aren’t so strongly invested in either position will be swayed one way or the other. Or maybe a gradual, subtle change in viewpoint will be created over time.
Frex, I was once all for doing the economic equivalent of taking all the rich guys and hanging them up by their heels and cutting their throats, just to see if they were so all-fired important to the economy as they and their apologists claim. Now, thanks to many arguments with Sam Stone and John Mace and (it feels like) every free-market libertarian on the Dope, I feel that their mansions, yachts, vacations and such are an unimportant blip on the economy. They can keep them. The important thing is to stop them from looting the middle class and the poor. Let the rich get rich, so long as the poor and the middle class get richer, too.
On the other hand, I feel I have helped some libertarians and conservatives see the importance of social safety nets in an economic system which admits to requires 3 or 4 percent employment in order to work efficiently.
While all is harmonic agreement, there has been movement toward the middle.
[/QUOTE]
I suppose that’s fair enough. The zealots won’t be converted. I’d like to think that we’re all preaching to the people that read the debates, but aren’t in them.
[QUOTE=gonzomax]
Not only can a bad exec hurt a company but they do. It s not rare for one of these rarified individuals to screw up. Cheney when he was at (he never left) Haliburton bught a company wth huge asbestoes claims. HE managed to get a bill limiting the size of claims through the Repub congress and Senate. It saved his decision.
[/quote]
And you think this is an argument against businesses and CEOs? What it is, is an argument against letting government be in a position where it can make these kinds of choices. It’s an argument against government, not business.
I have no idea what this means. Do you think Human Resources makes the decisions about who to hire? Almost NEVER. Human Resources departments typically are in charge of managing the employees who are already in the company. They don’t decide who to hire or fire. You are apparently completely ignorant about how companies actually function.
Let me fill you in, with an example from a large company: A decision will be made to build product X. A manager will be put in charge of developing product X. His responsibilty is to organize a team of people who can build it. This requires either scavenging people from other teams, or hiring new ones.
Typically, all the development managers will get together once a year or once a quarter, and sit down and do strategic planning. They’ll look at all the employees they have, and what they are currently doing. They’ll evaluate the market conditions and decide where their resources are best spent. The manager with the great idea for a new product will have to compete for resources with the guy who wants to upgrade product X, or who has his own idea for a new product. Between them, they will pitch their ideas to the next level up. Those people in turn have to prioritize all of these plans, and make their own plan which they then pitch to the next level up. At higher levels, managers are also planning out long-term strategic goals - multi-year plans. They have to juggle all the current development plans for each quarter and fit them into the master plan.
This is not easy. In fact, it’s hellishly difficult. Millions or billions of dollars have to allocated to thousands of different projects, all of which have to fit a coherent strategy that makes sense for the company’s long-term vision.
Out of this, a manager may get approval back for his particular project. He’ll be given a budget, and approval to take people from various other projects which are ending. Perhaps Bob the QA will be available when his current duties end in February. Steve the UI analyst won’t be available until March. Five junior developers will be available in two weeks. And the budget includes money to hire 15 new resources.
So now this manager has to juggle all these schedules around. He has to make educated guesses as to how hard it will be to find his 15 new resources, and how long it will take them to get up to speed. He has to account for training, find places for them to work, etc. Our of his current pool of people, he has to decide which ones are suitable to lead teams, and promote them.
Where HR gets involved is that he’ll inform them that he needs to hire X number of people, and what their skills need to be. HR will arrange the ads, negotiate with headhunting firms, and do other tasks to facilitate hiring. When they have suitable candidates, they’ll be passed back to the management team, who will then assign people to interview them and make decisions about whether to hire them or not. After the decision is made to hire people, HR sets them up with employee numbers, files paperwork with the government, gets the employees to sign up, informs payroll, and all that stuff.
HR has absolutely nothing to do with deciding who to hire.
Now, go back over all this stuff I described, and spot the many ways in which it could fail. The project manager might blow the estimates for how long something takes to build. He might blow the estimate of how many resources are required. He might hire the wrong people. He may set the schedule too tight, which means it will run over and people will sit around doing nothing because the prerequisite parts for them to do their job are not finished. Or he may set the schedule too loose, and run the team inefficiently.
Up the line, his managers may make bad choices when they choose which projects to fund. They may miss opportunities, or squander resources that were needed elsewhere. Or they may have chosen a poor manager, and see their fancy interlinking annual plan fall apart. The product doesn’t ship in time, and their salesmen have nothing to sell. So the good ones leave for greener passengers, weaking their sales arm.
And so it goes. Bad decisions ripple up and down the company. Good ones pay off with higher profit and more sales. People are held accountable at every step of the way. A project manager who habitually brings in projects behind schedule or over budget will soon find himself back in the ranks of engineers. A strategic planner who constantly picks products that tank in the marketplace will be out of a job. A CEO who chooses business unit managers who don’t perform will be under pressure from the board of directors.
Through all this churning, the cream rises to the top. The project manager who consistently shows good judgement and excellent management skills might get a shot at leading the entire engineering division. The engineering manager who shows the characteristics needed for higher-level strategic and financial planning might be promoted to manage a business unit. Business unit managers who excel among their peers might move into head office and become strategic managers at the corporate level. And so on.
And here’s one reason why the guys at the top make so much. They have to. Consider: If you’re a software developer making $100,000 per year, and you’re offered a management job, are you going to take it if your salary doesn’t increase? No. THe management job may require travel, longer hours, and much more risk that you could lose it all if you fail. So maybe he’s made team lead, and bumped to $125,000. Then he’s made a project lead, and bumped to $175,000. Then from there he becomes head of engineering, with his salary bumped to $275,000, plus incentive pay. Since he’s excellent, his incentive pay gives him another $100,000. So now he’s making $375,000. He’s offered the job of Business Unit manager, at $375,000 plus incentives. But since he’s now taking on risk for the entire business unit, if he does a great job his incentive pay might earn him an additional $200,000. So now he’s making $575,000 per year. The move up to head office as one of the managers of several business units might bump him to $750,000.
And so it goes. To get to the top in a large corporation might mean being promoted 10 or more times. Each time, there has to be enough bump in pay to encourage the best of the best to take the risk, uproot their families, work longer hours, and take on more responsibility. By the time you get to CEO, the compensation has to be quite high.
Here’s the other factor: Other companies can spot excellence as well. Long before you make it to CEO, other companies will start recruiting you. Your reputation gets around. You get a call from Motorola saying, “Whatever they’re paying you now, we’ll pay you 50% more.”
This gives the best people strong negotiating power. So the prices for them start to get bidded up. That’s why the absolute best of the best earn staggering incomes.
Note that it’s all based on their proven ability to bring value to the company. If managers were truly just useless rubber-stampers, companies would not bother with any of this. They’d just pick people at random, call them managers, and they wouldn’t have to pay them any more money. Then the owners of the company could pocket the savings. Since they don’t do this, the entire premise that managers are not worth what they are paid is simply wrong. They are paid what they are paid because the people doing the paying have decided that giving them their millions of dollars will ultimately bring more than that into the company. There’s no charity here. No ‘old boys club’ that cackle evilly and divvy up the people’s money. It’s all about performance and who’s the best at making money for the company. Period.
Only in hindsight. Ford and GM made a KILLING on SUVs. The profit margins on trucks and SUVs were huge, and in fact still are. And in fact, it wasn’t SUVs that kiled them. It was many other poor decisions over the years, starting with the decision to cave in to the unions and offer them overly-generous retirement packages that the companies couldn’t afford. Another was that they chose to let the bean-counters cut production costs to the bone, trading off quality for cost savings. Another was their failure to invest enough money in drivetrain development, meaning domestic engines tended to be less efficient and less smooth than their counterparts.
There are many, many reasons why the big three automakers in the U.S. are getting hammered. But you might want to note that this makes my point - have a look at how many CEOS and other executives have been cashiered from the big three due to these choices.
Keep in mind that a management structure is nothing more than an information processing entity. As we develop new and better ways to manage information, we’ve been able to flatten the management structure in most companies. At the last big company I worked at, we eliminated several laywers of management over a ten year span that included the birth of the internet/intranent, readily available database software, and other information processing tools.
But try to get anything done with a group of 8 or more adults without some sort of hierarchy and be prepared for failure. Try to do that with 800 adults and you have utter chaos. Companies like GE and IBM, of course, have employees numbering on the order of 100,000 spread across the entire globe.
What is the OP’s explanation for why his proposed “average man” business model is not actually being successfully used anywhere but in his imagination?
[QUOTE=Bricker]
What is the OP’s explanation for why his proposed “average man” business model is not actually being successfully used anywhere but in his imagination?
[/QUOTE]
I asked the same question earlier. My guess is that he thinks “the man” is holding him down.
Huh? Of course it is. There are plenty of people out there running businesses of varying sizes “quite well” who could be described with reasonable accuracy as “a person of average intelligence with a strong crew of managers with good staffs doing research”.
I don’t buy the OP’s more exaggerated hypothesis that all CEO’s are simply mindless rubber-stampers, but I also don’t buy Bricker’s exaggerated hypothesis to the contrary. It’s preposterous to claim that there isn’t any CEO (except in EC’s imagination) who’s simply an average joe doing a decent (but not spectacular) job thanks to conscientious (but not brilliant) work and good support from subordinates. After all, a sizable proportion of people doing “quite well” in any profession fall into that category.
There are literally several million corporations in the US alone; I seriously doubt that all of them, or even all the successful ones, are being run by a super-race of managerial masterminds. And that’s what we’d have to assume if we accept the claim that the “adequate average joe CEO” exists only in EC’s imagination.
The law of averages being what it is, you are probably right Kimstu. Still…can you name a few so we can look them over and see how ‘average’ they are? Pick any CEO from any company of, say, the top 1000 corporations in the US. That should give you a pretty big group to choose from to find an average joe type CEO running a company as the OP envisions. You an widen the field if you feel you need too.
-XT
Geez, now you just sound desperate. “Okay, I admit in theory that some CEOs might be people of average abilities instead of superhumanly talented managerial masterminds, but I won’t actually believe it unless you name names!”
Is there any other professional group that you have this level of implicit trust and deferential admiration for, or is it only business executives? There are a lot of professions I happen to admire (business management among them, btw), but I can’t imagine accepting the assumption that any of them is populated only by brilliantly gifted superstars—or even that the reasonably successful ones among them must all be brilliantly gifted superstars. C’mon, we know that there are brilliant CEOs and lousy CEOs, at every level of corporate size and complexity…why on earth would we doubt that there are also some “adequate average-joe CEOs” between the two extremes?
[QUOTE=John Mace]
How does they guy of “average intelligence” get the “strong crew of managers” to work for him? And why would they stay?
[/quote]
Offer them money? I mean, people do that all the time in the business world I hear.
An interesting variant on “If you’re so smart, why ain’t you rich?” Admit it, you’re just saying that in hopes that I’ll stop posting here if I get involved with such a project.
Truth to tell, I don’t do it because I’d rather write porn. It’s more fun and less morally ambiguating.