Up here in “the Pit” catching the early morning financial news on CNBC (did I tell you I love my multi-screen computer system with TV? I DO!!) but the big news today is that the automobilele guys, Ford, GM, and Chrysler must present the government with their “plan” to make itself viable and work. And the big Union reductions they claim are necessary to make it work are not coming. They are deadlocked in discussions, despite comments of “some concessions”(whatever the hell that means!)
I’ve owned several businesses and it is not really rocket science, in that you either have the money to pay your bills, including your payroll, and other costs of continuing your business, you borrow the money to do it, which means convincing the lenders that you can work successfully as well as repay them for the loan in a reasonable time frame, OR you cut your expenses so you can operate within your available operating funds, OR you seriously find and lock up the “Golden Goose” and make sre they are on a maximun egg laying output until you can give it a rest, OR close the doors and resign yourself to the fact that “the party’s over”
Now, let’s examine the “ethics” of businessmen, I know it sometimes seems like an oxymoron, but,….anyhow. The “ethical” businessman will, like the “unethical” know when it gets to be decision time. When you have run out of options for “same old, same old” management, and action, of some sort, is necessary. But that is the juncture where things differ.
The ethical manager looks and says “What can I do… : a) to save the business through increased revenue or sales increases, or b) to provide for an orderly and fair reduction of costs and expenses to confirm a break-even or mildly profitable continuing operation process, or c) the orderly, necessary, and positive, and reasonable timing of closing and liquidation of assets, jobs, and ultimately the very existenceof the business. That is the only reasonablele, ethical, and logical method of operating.
On the other hand the “unethical” manager will a) see how he can take care of himself first and foremost, via bonuses, contractual guarantees (i.e. golden parachutes) , and start lining up your next “career move” through the “Good ol’ Boy” business executive network. (Case in point the CEO of Chrysler, Nardelli. He ran Home Depot into the ground, got his ass in a sling and fired, and “POOOF!” he becomes the CEO of Chrysler Motors! Want to explain how that happened and what I missed, please?)
After the “wheeling and dealing” to secure themselves, and their own pocketbook, the unethical manager will radically increase “same old, same old” managementtechniques to provide public awareness of an “all out effort” to bring all the tools into play to “turn it around”. (This effectively burns up valuablecash, and takes away any criticism that they did nothing, while “hardening” theirpersonal buyouts and golden parachutes, and assuring the company will be so “bled” of it’s cash there can be no objection to liquidation and closure with a postscript of “They did everything they possibly could have done,…good managers, impossible turnaround.”
Then the previously determined “closure” plan is announced with Oscar performances of regret and lip service to the end of jobs, and livelihoods for thousands of “regular folks” who did nothing but their job as directed.
The labor unions are definitely the 800 pound gorillas that will take down the auto industry in this country,….shamelessly! They will put all of thier members out on the street, try and funnel them a few bucks much akin to putting a band-aid on a machete wound, gather their Union Management salaries, bonuses, and golden parachutes as well, and quietly fade away to a Condo in South Florida, or Arizona with a new set of Ping clubs to lament those left behind in a cesspool of problems.
Can anyone else see this as vividly as I can, or do you think I’m just a “defeatist”? I’ve owned businesses personally, I’ve faced those options on many occasions, some times I steered out of danger, but others ,….well it’s like the final scene of “The Perfect Storm” pushing with every ounce of strength and capacity you have, but staring out at a vertical wall of water about to swallow you up,….forever.
My regret is that we may have great schools, “B” schools, and other fertilelands to learn plant ideas and concepts in, but we’ve never put “ETHICS” ahead of dollars, that is his countries fundamental mistake. And we will continue to do so until someone kills politic, kills greed and avarice, and ultimately does something very similar to the Chinese. What ever happened to the guy who was CEO of the company with the “tainted” baby formula? Serving life without parole, having narrowly missed a death sentence, and it took them all of a couple of weeks from start to finish.
Here’s hoping we get a few more “ethical” businessmen out there, and eventually they can make the difference.
-30-
The Emerald Rose 
The best thing the auto industry could do for themselves would be to get rid of the union…period.
By: coffeypot on February 17, 2009
at 10:41 am
Since when were the Chinese more ethical in business? They are stricter with their employees— but more ethical?! They have as much to learn from us as we do from them.
I think it’s clear that for the most part, management here are one-trick ponies, and that by and large, business school is spitting out cookie-cutter monkeys who know only how to intimidate and exploit other people, but do not really understand how the system functions because of all the compartmentalization. Which is why all the bailout money in the world won’t fix the problem— because THEY are the problem. We need people who have the smarts to work their way up to be in charge, but the rate of superficial innovation is making this an impossibility. By the time you get halfway to management, some twit has altered the manufacturing process to the point where it’s no longer familiar, especially now that there’s such an issue with digital conversion and subsequent upgrades. (Our car industry is like a robot with three brains and ten hands— and none of them know what the other one is doing.)
So basically, executives and management ought to invest their “bailout” revenue in a plot and a tomb, because even if they clean up their messes, nobody is going to be able to afford their products what with the state of the economy.
By: onlyjustwords on February 18, 2009
at 12:30 am
Onlyjustwords,
I appreciate your comments, and by the way I agree with your line of thought. Management to me is not learning patterns devised forty or more years ago, but creating patterns anew and testing them. Lord knows creativity was really alive in the financial markets,…but the testing process was omitted.
Mr. Guinness
By: guinness222 on February 18, 2009
at 7:52 am
“Lord knows creativity was really alive in the financial markets”
You can say that again! 😛
By: onlyjustwords on February 18, 2009
at 12:22 pm