People are talking about building in-house talent. I was part of the in-house talent at Hertz. We were executing the strategic initiatives (at some level we came up with them), and we were doing a damn fine job at it.
In early 2016, they fired us all. We were made to train up our replacements (at IBM in India) in order to receive severance packages. Later we found out that Accenture had picked up the initiative. And now the world knows the rest of the story.
All the points made here (ie warning signs, organic initiative) were passionately made at the time to Hertz brass. But someone, no doubt on a golf course somewhere, sold them the idea that they can save millions on paper. And, on paper, they were right: Shortly after firing us all, the CIO received a $7 million bonus. Unfortunately for everyone involved (except the CIO, of course), paper doesn't reflect reality.
Profit, short term thinking, incompetence. This triplet is so common that seems to be part of a major study that lots of execs have properly mastered.
Is there anywhere some study/statistics that shows the impact of those 3 elements together? Because I am quite sure it's extremely common, or I just stumble upon such cases really frequently....
Because the company that decides to punish their CxO will have a hard time finding one. People job hunting at that level want a guaranteed golden parachute, whether things go well or not. And the board agrees to pick one of these guys up because that person will implement all the shitty decisions while leaving the board with clean hands. Everybody (who's high enough) wins because they all get their paychecks and bonuses by the time the cookie crumbles. And when it does you can blame the "dead guy", the same CxO that already took off with the golden parachute and is off to another company to do the same thing.
I know a few of these people, moving around in similar positions in every company. They are brought in as hatchet men, with full knowledge that it will be a fiasco. But before this becomes obvious everybody gets to tout cost savings, optimizations, etc. to get their bonuses. Then the person is paid handsomely to leave and take all the blame with them. Their LinkedIn profiles are chock full of 12-24 month stints at all kinds of companies with "successful" projects... until you ask someone involved with those projects.
I think that people who leave when the CEO is replaced are looked down upon for that. However, I think it's a reasonable fear due to this.
We should name and shame those who do that. It's a short term success for long term damage. (It's going to take a long time for Hertz to recover from this, and I can't imagine their lawsuit is going to be too successful [they still need a new site])
For me generally, it's execs that come from Cisco or GE tend to do this kind of thing.
I wonder what a stock portfolio based on shorting companies who sign contracts with IBM India, Accenture, Wipro, etc. for outsourcing would look like in terms of performance. Probably too much of a leading indicator to be truly useful.
In early 2016, they fired us all. We were made to train up our replacements (at IBM in India) in order to receive severance packages. Later we found out that Accenture had picked up the initiative. And now the world knows the rest of the story.
All the points made here (ie warning signs, organic initiative) were passionately made at the time to Hertz brass. But someone, no doubt on a golf course somewhere, sold them the idea that they can save millions on paper. And, on paper, they were right: Shortly after firing us all, the CIO received a $7 million bonus. Unfortunately for everyone involved (except the CIO, of course), paper doesn't reflect reality.