
How to kill a company's morale in one easy memo - mcantor
http://technocrat.net/d/2006/8/28/7262/
======
abstractbill
From the comments:

 _My sister used to work for a large multinational that pressured people to
come in on Saturdays. The employees would come in but they would work on
personal tasks like paying bills and balancing their checkbooks. It was all
for appearance and it just pissed off the employees. She left the company
after this pressure started. Part of her Saturday "work" was looking for a new
job._

In my experience this is par for the course. Sure, you can force employees to
spend more time in the office, but past a certain point they'll just find ways
to satisfy your crazy demands only in the most technical sense possible.

~~~
Periodic
It's a case of misplaced metrics. I can't find the name of the paper or the
researcher, but I believe it's been shown that when you try to reward/punish
some metric of productivity, invariably the employees will begin to maximize
that metric, perhaps at the expense of productivity.

Measuring number of hours in the office is not a direct measurement of
productivity, and these employees were meeting the metric, but only costing
the company money, not making it any.

Incentive structures are tricky.

~~~
RyanMcGreal
>I believe it's been shown that when you try to reward/punish some metric of
productivity, invariably the employees will begin to maximize that metric,
perhaps at the expense of productivity.

After years of direct involvement in measuring productivity, I would accept
that as a general axiom. I've likened it to badly applied wallpaper: push down
a bubble and it just pops up somewhere else.

~~~
caffeine
Even if the metric is a direct business metric that it's manaagement's job to
optimize (like profitability or number of users)?

I've always thought it would be interesting to see the results if half of
everybody's salary (including the CEO and the toner refill guy) was paid by
dividends from shares of the company held in trust for this purpose. As in,
every year, everyone's pay goes up/down by the same (relative) amount.

What if, in addition, the shares held in trust were a closed pool, requiring
employees to give up part of their bonus share to any new employees hired? The
expected net outcome of hiring on profitability would then have to outweigh
the decreased income from a (very slightly) reduced share of profits.

I'm not certain that this is the ideal system of incentives (i.e. there might
be local minima one could get stuck in), but it would certainly be an exciting
experiment...

~~~
RyanMcGreal
Dan Pink would suggest that if you're trying to drive performance by tweaking
monetary incentives, you're doing it wrong.
<http://www.ted.com/talks/dan_pink_on_motivation.html>

------
ryanwaggoner
I'd actually like to take a step back from the hate-fest going on in the
comments here and evaluate this. Before you downvote me, at least read what I
have to say.

This email is a classic example of poor communication. It's very clear that
the guy is frustrated and is taking it out via an emotional response. However,
we don't know the whole story here, do we? From my reading, it _sounds_ like
this has been an ongoing problem for awhile now. Keep in mind that this was in
2001, not exactly an easy time to be running a software company. I can imagine
the frustration of running a large company with thousands of employees and
seeing a lack of results, coupled with evidence of employees not spending much
time at work. What would _you_ do in such a case? Not necessarily with regard
to the email, which I think we can all agree was in poor taste, but with
regard to the actions he says he's going to take.

Additionally, we don't know if this memo did in fact kill morale at the
company. We know that the company has done well over the last nine years, and
that Mr. Patterson was recently honored as one of the best bosses in the
country. The Wikipedia entry specifically mentions the metric of great
performance relative to compensation, so he's obviously creating value.

I guess my point is that everyone makes mistakes, especially when they're
frustrated and facing a large problem. And make no mistake, managing a
software company with several thousand people in 2001 would be a challenge.
I'm not saying this was the right approach, but what _exactly_ would you do?
And more importantly, if you've never faced management at that scale, why do
you think it would be more effective than his approach?

~~~
hyperbovine
To get where the author of this memo got (CEO of a publicly traded
corporation), work essentially has to be your life. I mean, your #1 priority,
ahead of friends, family, fun, and everything else. I have never seen an
example of such a person at the helm of a large, multinational corporation,
who does not, generally, appear to fit that description. This memo illustrates
the total disconnect between that sort of person, and the other 97% of us for
whom work ranks a distant 5th-10th on life's list of priorities.

So, in some sense, it's understandable. Inexcusable, but I at least get the
place from where this sort of vitriol is coming from. He really thinks he can
get people to care as much as he does. In some ways it's amazing that he made
it so far while remaining so deluded.

~~~
mrvir
And the irony might be that he gets a company that _outwardly_ looks exactly
like he wants. The sheep willing to conform will stay and others will move on.
Now I'm not saying anything about productivity, that's another question then.

------
j_baker
"I think this parental type action SUCKS. However, what you are doing, as
managers, with this company makes me SICK. It makes sick to have to write this
directive. I know I am painting with a broad brush and the majority of the KC
based associates are hard working, committed to Cerner success and committed
to transforming health care. I know the parking lot is not a great measurement
for 'effort'. I know that 'results' is what counts, not 'effort'. But I am
through with the debate."

This part proves that this guy is the worst kind of douchebag: one that knows
what he is doing is stupid and heavy handed, and yet does it anyway.

~~~
jgrahamc
On the company's web site there's a page about him (he's the CEO):
<http://cerner.com/public/Cerner_2.asp?id=27586>

In that it says: "Cerner associates extol Neal for his passion and foresight,
his ability to drive change within organizations, his entrepreneurial spirit,
and his candid, uninhibited conversational style."

So that's just a candid, uninhibited conversational style :-)

Note that that message was sent in 2001. If you chart CERN against the NASDAQ
over the last 10 years you'll see that the memo hasn't hurt company stock
price one bit.

[http://www.google.co.uk/finance?chdnp=1&chdd=1&chds=...](http://www.google.co.uk/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1277323200000&chddm=491878&chls=IntervalBasedLine&cmpto=INDEXNASDAQ:.IXIC&cmptdms=0&q=NASDAQ:CERN&ntsp=0)

~~~
mrbgty
Are you defending this guy?

~~~
jgrahamc
No. I'm pointing out that he may be a total ass, but it doesn't seem to have
hurt his company.

~~~
barrkel
Yes, but you didn't present evidence that he didn't hurt his company. You
presented evidence that he didn't hurt the company so badly that it didn't
grow, but not that he didn't hurt the company.

~~~
anamax
> You presented evidence that he didn't hurt the company so badly that it
> didn't grow, but not that he didn't hurt the company.

Since no one has presented evidence showing that he hurt his company....

In my book, you don't get to complain about the quality of someone else's
evidence unless your evidence is better. And no, "self-evident" doesn't count.
YMMV.

~~~
barrkel
At the risk of getting meta, I was complaining about the quality of the
evidence for the assertion. I never made any assertions about the company
suffering in any way because of this guy.

------
andybak
Looks like someone needs to read The Mythical Man Month.

(I know TMMM is about specifically software engineering but for a CEO to think
that bums on seats==productivity is fairly depressing)

On a aide note - Americans! Move to Europe! Our economy is collapsing too but
we're having a much better time watching it happen...

~~~
mkramlich
your last line there was the funniest comment I've read on HN in years. thank
you!

------
sigzero
We got this:

"Recognizing that many of you may have childcare obligations that may create a
personal challenge for you please seek approval from your manager to deviate
from the above and don’t allow your personal schedule to take priority over
your need to support your team’s efforts to service the customer."

A lot of people where I work didn't particularly like the tone of that.

~~~
bryanh
Translation: "Kids are important and stuff, but keeping customers happy is
what matters."

~~~
bitwize
"You're supposed to be helping OUR people! What about our stockholders? Who's
looking out for them? HUH?!" --Gilbert Huph

------
brown9-2
The fact that the CEO sends emails with subject lines such as " MANAGEMENT
DIRECTIVE: Week #10_01: ..." (with "directives" numbered by week and sequence)
should have been warning enough.

update: Google Finance and Reuters show that the Chairman and CEO of Cerner in
2006 is still in the position today. Looks like their stock has recovered from
this "20% drop nicely": <http://www.google.com/finance?q=NASDAQ:CERN>

~~~
RK
The comments imply the original memo was from 2001.

~~~
neilc
But Neal Patterson, the author of the memo, is still the CEO and chairman of
the board. <http://www.cerner.com/public/Cerner_2.asp?id=27586>

------
aphyr
Am I the only person who saw the line about the parking lot being half empty
at 8 and 5 and thought, "Oh, that's consistent with a normal distribution of
people working 10 hour days with a couple hour variance in arrival times"?

~~~
tonystubblebine
I thought there was going to be a punchline about the CEO not realizing that
they'd laid off 50% of staff.

------
dbrannan
Hmm... sounds like this issue could be solved if everyone stopped car-pooling.

~~~
nuxi7
Or if everyone just left their cars at work and took public transit/carpools
the rest of the time.

~~~
hernan7
Or, if they bought a $500 lemon, left it taking up space in the company
parking lot and kept commuting as usual. In that case, are the $500 tax-
deductible?

------
leelin
I'll call some BS on the stock price affect... after some quick Googling this
article seems to pinpoint the exact date:

<http://www.healthdatamanagement.com/news/4296-1.html>

Comparing CERN stock vs the S&P500, Dow Jones, and a related company ECLP and
MDRX will show that all of them tanked the same week, and all of them
recovered quite well within a month or so.

~~~
nl
The link above is actually about the effect this memo had on the stock price.
To quote:

 _A blunt e-mail message from Cerner Corp. CEO Neal Patterson about the work
ethic of some employees caused the company's stock value to fall sharply last
week. The company acknowledges the harsh tone of the message could have caused
investors to question if the company was in crisis_ ... _After the e-mail was
posted on a Yahoo! bulletin board last week, the stock fell nearly 20% on
March 22-23, including 15%, or $6.13 per share, on March 23. Patterson
threatened installing time clocks, discontinuing an employee stock discount
program and cutting staff by five percent, a morale blow at a company that
prides itself on good employee relations. He told managers they had two weeks
to get their units in shape, or "pack your bags." In a March 23 interview with
the Kansas City Star, Patterson said threatening measures are not being
pursued, but he continued to voice concern about work ethics in some segments
of the company. He also sent out another e-mail apologizing for the harsh tone
of the first one._

It would be interesting to see the apology email.

------
mcantor
From mildweed's comment in the CalTech thread:
<http://news.ycombinator.com/item?id=1455037>

~~~
mcantor
Just idly curious, but why did people upvote my attribution comment?

~~~
lotharbot
It's a behavior we wish to encourage.

------
hernan7
By the way, isn't this what working for Apple is supposed to be like? Except
that when you do get to go home, you can't even discuss what you were working
on during the day.

Edit: downvote if you must, but info on the work/life balance at Apple is
preferred.

------
antidaily
_In April of 2010, Forbes magazine named Patterson fourth on their annual list
of "America's Best-Performing Bosses"_

<http://en.wikipedia.org/wiki/Neal_Patterson>

~~~
wazoox
Doesn't excuse being an horrible asshole.

~~~
zaa
It is just a business, nothing personal :-)

~~~
wazoox
Finally he could have said it more nicely and clearly: "if you work for me,
you're expected to have no family life, no personal life, to be manic crazies
who live and breathe for their work only ."

------
ax0n
As an IT guy hailing from the general area that Cerner calls home, I can
honestly say this is where hackers' souls go to die.

------
ScotterC
Man this is terrible management and exactly the type of thing that just asks
for backlash.

Where's the students of history? When you create a police state like this in a
company, control will be lost, morale will fall and productivity crashes.
Abusing your force only makes it worse.

~~~
dget
While I agree that it asks for backlash - do we actually know what happened?
It seems like the company's doing decently, so I'm not sure the students of
history will have much to work off of.

~~~
ScotterC
More talking about actual history such as 19th century Europe.

However this memo is dated as August '06 so we can assume that it happened
sometime earlier that summer. From this google finance chart:
<http://bit.ly/ar1PSo> it shows the massive dip the company took in July of
the same year.

Aside from all that, actions like this will bite you in the ass in one form
another. I doubt many visitors to hacker news hold CEO Neal L. Patterson in
high regard after this.

~~~
JoachimSchipper
Actually, other comments mention 2001.

~~~
ScotterC
Guess I need to re think my argument then eh?

------
hernan7
See also: [http://philip.greenspun.com/ancient-history/managing-
softwar...](http://philip.greenspun.com/ancient-history/managing-software-
engineers)

At least Greenspun took into account the need of his engineers' air to be
humidified.

------
Mankhool
Never confuse movement with action.

------
CWuestefeld
I wonder _why_ he's such a jerk.

I can't imagine treating the folks in my department that way. I don't want to
own their souls. I _hope_ that they consider the work that they do here
enriching, and I also _believe_ that in partnership we make a better
department as well as better lives for all of us. I'm _proud_ that our people
lead fulfilling lives that include much more than banging out code.

Somebody who wants people to dedicate their lives to their jobs; indeed,
someone who seems to want to live in a world where people act that way, is
just a mystery to me.

------
fred24
This memo is really from 2003 according to one commenter on the Technocrat
page claiming to have worked there. If thats true, Cerner stock is up over
600% since - Dow is up 16%. Well...

------
dedward
Hypothetically...

The memo would certainly kill morale at most places I've been. The corrective
actions being asked for are completely wrong.. but this is aimed at middle
management.

Read the beginning of the memo - not the end. If the parking lot is largely
empty at 8am and at 5pm..... and workers are expected to work a standard 40
hour week, that's an indication that something might be wrong.

One can also assume that if the organization was functioning correctly and
middle management was doing it's job - the CEO wouldn't give a rat's a __about
the parking lot - because he'd have the metrics in front of him to say "Damn,
that KC facility is doing awesome! Every other facility should be learning
from these guys.". Instead, something prompted him to feel that the place was
slacking, and seeing an empty parking lot at 8am AND 5pm is a pretty good
indication that people aren't even putting in minimal working hours. Fair
enough. (And if he's completely wrong - middle management should be able to
manage upwards correctly and explain to him why he's wrong, why everyone is
car-pooling and why the metrics and results are best-of-class, so he should
just back off)

------
teilo
Sounds like this guy must have had an unfortunate convergence of: A late-night
viewing of Glengarry Glen Ross. A fight with his wife. A bottle of JD.

------
dsulli
This is a CEO of a company that wants to get a product out the door. Sometimes
that's not easy. He's basically using the tools at his disposal. It sounds
like he's given his team a year, and they still haven't delivered. An email
like this can sometimes shake out the non-performing team members and lead
them to quit. In a company with 7,600 employees - I'm pretty sure not every
one is a star performer.

Anyways, I've worked for a CTO who basically was a raving lunatic. Every
couple of months there would be some kind of a blow up. But, looking back, we
also did some amazing work under him, and created a cutting edge service still
used 6 years later.

------
loewenskind
From the NYT article on this event [1].

>It made Fortune magazine's lists in 1998 and 2000 of the 100 best companies
to work for in America.

Why do people still cite this ridiculous report? It's had both Walmart and EA
in the list. Both companies are about as bad to work for as is possible as a
professional in a first world country.

[1] [http://www.nytimes.com/2001/04/05/business/stinging-
office-m...](http://www.nytimes.com/2001/04/05/business/stinging-office-memo-
boomerangs-chief-executive-criticized-after-upbraiding.html?ref=cerner-
corporation&pagewanted=2)

~~~
dagw
I imagine it depends a lot on what you do. Fortune magazine targets rich
manager type people so I'm assuming they mean best companies to work as a
highly paid manager. I have no reason to believe that Walmart or EA (the
actual EA, not one of their game studios) couldn't be great companies to work
for if you're a senior manager in charge of major aspect of the company. If I
was a global logistics guy, Walmart might very well be at the top of my list
of companies I'd like to work for.

------
joejohnson
That blog layout is really hard to read. There isn't enough structure around
the text and too many similar fonts or font sizes are used.

------
xster
Expectations of having employees stay until 7:30 when they're payed to stay
until 5... how did we get there?

------
curiousgeorge
At risk of sounding like a complete asshat to apparently everyone else on this
thread, a 9:00 - 4:00 workday is what I had in kindergarten. If I were running
a company with this issue I'd consider it a big problem too.

------
umjames
The CEO should be required to go to Kansas City and work alongside the
employees who he thinks are slacking off. That includes being in by 8am,
staying late every night, and coming in on Saturdays. Everyday, he cannot
leave until all of the employees leave, and while he's there he must help do
the actual work that needs doing so badly. He cannot leave Kansas City until
the productivity levels rise to his liking.

After all, if he thinks this is reasonable for his employees, he should lead
by example.

~~~
brg
Have you ever been around senior management of a larger company? Everyone I
have met works at least 10 hours a day, and often more. Except for vacation
days perhaps, but even then they are still tied to the laptop and phone.

~~~
umjames
Yes, but I'm sure it's ultimately their choice. Does the board of directors or
stockholders send the CEO a memo that his car is not in the parking lot long
enough for their liking?

If the CEO wants to work him/herself into an early grave, that's his/her
choice. But to force employees who, let's face it, aren't going to be able to
enjoy the fruits of their labor like the CEO will, to give up large portions
of their personal time to improve the wrong metric? That's unreasonable.

~~~
MikeMacMan
Agreed. This reads like the ranting of some fossil that clamors for the 'good
ol' days' when everyone used to be married to their job. This is apparently
one of the best places to work in the country, according to ComputerWorld:
[http://www.computerworld.com/s/article/349873/No._52_Best_Pl...](http://www.computerworld.com/s/article/349873/No._52_Best_Place_to_Work_in_IT_Cerner)

------
iuguy
Wow. I'd never work there. If I did, I wouldn't work there for much longer. We
work on the principle of letting people manage their own time. When there's
stuff that needs doing, it gets done but there's always at least some time off
afterwards to make sure people can recover from late nights or weekends.

------
butterfi
"We Make Health Care Smarter"

But we apparently don't check for spelling or grammar.

~~~
wyclif
Agreed. It reads like someone who is so fried from overwork he can't spell
anymore. Not a good advertisement for working 70 hr. weeks.

------
kitchen
maybe they all started biking to work?

