I’ve complained about being slaves to the calendar for years..ship it regardless of whether it’s good and/or done.. it may be crap, but we delivered! That’s results-oriented in the modern age..

http://www.npr.org/templates/story/story.php?storyId=100714491

which given the current climate will be just one of many on this topic in the media. The thrust of the story is that executives’ short term compensation doesn’t always lead to good long term results, and that modern executives have tended to concentrate on value extraction instead of value creation. (Notable exceptions: people like Bill Gates, who, no matter what you may feel about Microsoft, have created a huge industry with tens of thousands of jobs.)

My libertarian free-market friends are going nuts over recent developments of which we are all too too painfully aware. But my casual reading of game theory suggests to me that free markets really don’t exist, because the full costs of decisions are not borne by the decision makers but instead hidden elsewhere.

There are a lot of terms for this depending on what domain you are in: moral hazard (law), perverse incentives (insurance), incentive distortion (human resources), measurement dysfunction (management), maybe even the Heisenberg Uncertainty Principle (physics), but it’s all pretty much the same idea.

If the current crisis has taught me anything it’s that executives have done very little if anything to actually earn that big money. Mostly they’ve just been surfing the bow wave of a good economy in which even stupid decisions can appear successful, or at least benign, for a while. Warren Buffet was much more broadly applicable then he probably intended when he said “Only when the tide goes out do you find out who is swimming naked.”

Or maybe I’m just a cranky old man.

However, I can sympathize with CPM on this, it is painful to be in the trenches and watch senior executives scuttle the operation long before its natural cycle runs out…

Gander

Henry Kissinger once remarked “Every civilization that has ever existed has ultimately collapsed.” So if you broaden the timescale, this applies to nations, cultures, religions, and civilizations.

What’s the point? Entropy conquers all, given time. Maybe DysfunctoSoft’s time is now. From a purely free market perspective, maybe it’s time for those resources to be reallocated to better and more nobler purposes.

Our last CEO (Retired in Summer 2007) was the exact opposite. He would often wing our corporate direction in the investor calls (nb; I am sure he planned it, but us in the trenches were often NOT informed of our new strategic direction until these investor shindigs), and we would find out after the fact of our new market and product priorities. Real “not fun” situations.

Hope your months get better soon CPM.

Gander

I was sitting in on a call (at a different, smaller, dumber company than the one I’m at now) the CEO was doing with investors, when the CEO did exactly what yours just did. I was on mute, or everyone would have gotten an earful. In a pure rage, I popped open my IM, clicked on the COO’s ID, and vented a stream of “Are you people complete idiots?” at him.

Except it turned out that I had accidentally hit the CEO’s name instead. A couple of seconds later there the CEO broke off, you could hear murmuring in the background, and then the CEO said, “Uh oh.” The COO came dashing into my office to drag me away from the phone and ask, what do you mean we can’t–?!

You would’ve been impressed at the CEO’s soft-shoeing when it came ’round to delivery time. “When I said this,” he said, “I didn’t mean we would actually deliver this. I meant, we would have a plan in hand and would be ready to soft-test the market….”