Here are the elements: A 79-year-old control-freak owner (Raiders managing general partner Al Davis) who has gone through eight head coaches in the past 14 years looking for a puppet who can read his mind and do his bidding without question, hires a 31-year-old college assistant coach with a reputation as being too cocky for his slim résumé, and, makes him the youngest head coach in the history of the National Football League. The cocky young coach isn’t a yes man or a puppet, however, and soon he is butting heads with the control-freak owner.
Guess where this one ends—with the nasty, public firing of the cocky young coach, of course, but only after many months of media speculation on when the control-freak owner would actually get around to it. And over the many months of media speculation, the cocky young coach turns into a mouthy young coach who seems to relish giving the media many of the details of his situation with the control-freak owner. That’s what makes the public firing all that much nastier.
“Al Davis did the worst thing possible,” wrote San Jose Mercury News columnist Ann Killion. “He dumped all the dirty, disgusting laundry out in front of the television cameras and microphones and notebooks. And the stench was awful. … Davis confirmed it all. Not only all the rumors and whispers that have been building for the past 20 months about his deteriorating relationship with Kiffin and all the little grudges held. But Davis also confirmed the Machiavellian, paranoid nature of his rule. He is an owner who sends his coach—a man who was in his office from dawn to dark every day—a Federal Expressed three-page letter of accusations to create a paper trail so as to have evidence in court. … Davis has hated Kiffin for a long time … yet he allowed the situation to fester and grow and distract his team while he was Fed Ex’ing letters and documenting ‘lies and propaganda.’ ”
Coaches get fired all the time, as do business executives and managers at organizations big and small. Sometimes those terminations are there for all to see, but usually the protocol is that these departures are about “leaving to pursue other interests.” That’s not how Al Davis does it. “It didn’t have anything to do with winning,” Davis said in the San Francisco Chronicle. “It had to with personality. It’s the first time I ever let anyone go based on what I call just being a flat-out liar.”
Is this how to fire a person? Of course not, but don’t think that this kind of over-the-top abusive behavior is confined to professional sports. I once worked for a guy who rivaled Al Davis as a control freak. He was an entrepreneur who also wanted yes men and puppets, and he hired and fired generations of managers who tried to exercise a little independent thinking. He wouldn’t stand for that, of course, and he seemed to revel in the power he had to fire people and make them feel powerless.
There’s a special place in hell for people like that. It makes me wonder: Why would anyone want to publicly make it clear that he is a bully and control freak, more consumed with revenge and hurting someone than he is with building character and strength in his organization?
If anyone has a good answer to that question, I’d love to hear it.
As the Good Morning Silicon Valley blog noted, this exercise seems to be the preamble to Yahoo getting rid of more people. It points out the many euphemisms in Yang’s memo, such as “improve and accelerate our performance” and “be more agile in a competitive marketplace,” as tipoffs to Yang’s ultimate goal. It’s also worth noting that when Bain was invited in for a similar benchmarking project at Intel, the consultancy quickly became know as the “TaliBain” for the headcount whacking that ensued.
In fact, Yahoo watchers and Silicon Valley blogs are having loads of fun with this, especially Yang’s notion that the company “needs to get fit as an organization.” One went so far as to hilariously parody Yang as a Richard Simmons wannabe, and put Yang’s “getting fit” pronouncement in the “Grand List of Asinine Corporate Layoff Euphemisms.”
Maybe Bain & Co. consultants will bring something other than a layoff plan to the table, but it’s more likely that they’ll merely reinforce a management decision that’s already been signed and sealed—and just needs to finally be delivered.
“Yahoo really needs to downsize its staff,” said Jeff Lindsay, an analyst for Sanford C. Bernstein & Co., quoted on Good Morning Silicon Valley. “At some point, they’re going to be forced to have to take a few thousand staff out.”
If layoffs are that obvious to people on the outside of Yahoo, why can’t Jerry Yang and team just buck up, get some backbone and do the tough stuff that comes with a management role? I’ve written about that before, and my guess is it’s because Yang is spending far too much time agonizing over a decision that he knows he needs to make, but that he doesn’t have the huevos to actually pull off.
Maybe that’s really why Yang has the title Chief Yahoo after all.
And in that spirit, I have to say a silent prayer of thankfulness and a fond goodbye to Phillip J. Schoonover, the now-former CEO of electronics retailer Circuit City, because like Zell, Schoonover’s idiotic business strategy helped to fuel this blog with no end of wonderfully bad management decisions and practices.
Schoonover was canned by the Circuit City board on Monday, as I predicted they would do last December. As The Wall Street Journal noted, Schoonover was brought in from industry leader Best Buy some four years ago to turn around the troubled Circuit City chain. “Instead, the 48-year-old executive, who was named CEO two years ago, presided over a further decline in the company’s fortunes. He attracted criticism for decisions that backfired, such as dismissing veteran workers to cut costs.”
I love the understated simplicity of The Wall Street Journal, but saying Schoonover dismissed veteran workers to cut costs doesn’t really capture the full idiocy of Schoonover’s “management” decision. He didn’t just dismiss veteran workers, he purposely fired his most senior, highest-paid (and most experienced) floor workers and replaced them with lower-paid employees in some misguided cost-cutting experiment that not only demoralized his workforce and damaged customer service, but led to a number of age bias lawsuits as well.
Schoonover never admitted the terrible mistake he made despite withering criticism of his decision in The Washington Post, The New York Times, The Wall Street Journal, and here in the Business of Management blog. Even a big drop in sales and a sinking stock price failed to dissuade Schoonover of the folly of his decision, and his singular denial of any responsibility for his terrible people-management strategy led me to award him and Circuit City as the winner of the 2007 Workforce Management Stupidus Maximus Award “for the most ignorant, shortsighted and dumb workforce management practice of the year.”
The Journal’s story on Schoonover’s ouster quoted Colin McGranahan, a retail analyst at Sanford C. Bernstein & Co., who noted several of Schoonover’s blunders over the years, such as replacing the highest-paid, most seasoned staff in the company’s stores in an attempt to recoup losses caused by falling TV prices. “He underestimated the disruption that would cause,” McGranahan said. “If you worked at Circuit City, the only way to interpret it was that if you do well, you will be fired. It led to bad morale and staff disengagement.”
Yes, it is remarkable that a business strategy that rewards the best in your workforce with involuntary termination would be seen as anything but bad, but that’s why Schoonover won the Stupidus Maximus Award. How could anyone with any sense see it as anything other than dumb and foolish?
So, farewell, Phillip Schoonover. I’m sorry to see you go, because now there is one fewer shortsighted and idiotic manager to write about. But don’t worry about me. I’ll make out just fine. After all, I still have Sam Zell and his gang to keep me busy.
Here’s one lawsuit I want to follow: A group of former and current Los Angeles Times editorial staffers is suing Tribune Co. (the paper’s corporate parent) and Tribune CEO Sam Zell, “contending that reckless management is destroying the value of the company,” according to a story in the Times.
The lawsuit, which seeks class-action status on behalf of all employees of Tribune, was filed in U.S. District Court in Los Angeles and “alleges that Zell and former Tribune CEO Dennis J. FitzSimons devised a plan to take the company private to enrich themselves to the detriment of employees,” according to the Times. “Tribune’s roughly 18,000 employees became owners of the company when it was taken private in a transaction that saddled the business with $12.5 billion in debt and also created an employee stock ownership plan late last year,” the story added. “As part of deal, FitzSimons received nearly $21 million in bonuses, severance and other payouts, according to the lawsuit.”
Problem is, Tribune employees don’t really have much of a say in the employee stock ownership plan, so that has left them at the mercy of corporate troglodyte Zell (apologies to troglodytes) and his ham-handed henchmen like Tribune COO Randy Michaels. Zell and his gang seem to be dismissive of all the journalists and others in the company who have the temerity to ask questions and challenge Zell’s style and strategy.
That’s what makes this lawsuit so interesting. There’s only one current Los Angeles Times employee who is taking part in the suit, but he’s a Times star—Pulitzer Prize-winning automobile writer Dan Neil. “We don’t think the management of the company has been in the best interests of the employee-owners,” Neil told his own newspaper in the story on the lawsuit. “The Los Angeles Times is too important to be left in the hands of corporate raiders,” said Neil, who in 2004 won the Pulitzer for criticism for his automobile reviews.
As The Wall Street Journal points out, Zell’s $8.2 billion buyout of Tribune last December had an unusual twist: “The stock plan, known as an ESOP, became the majority owner, while Mr. Zell invested about $315 million in exchange for a promissory note and warrants to buy 40 percent of the company. The deal weighed down Tribune with nearly $13 billion in debt, but the ESOP structure allowed Tribune to avoid most federal income taxes.”
In other words, Zell only put down about 4 percent of the total price of the company and is using the employee stock plan to fund the rest. Neil told the Journal that he hoped the suit would unearth more information about how the company is run. “There has been a notable lack of transparency in the operation of Tribune, “Neil said. “We as employee owners of the company want to know about the finances of the company.”
Most employees would not have the cojones to get into a lawsuit against their employer. For most workers, suing the boss is not a career-enhancing activity. But if there is anyone who can do something like this, it’s someone like Neil, mainly because superstars have a lot more options than regular rank-and-file workers do. Plus, it throws down the gauntlet and challenges Zell to do something very Zell-like and boorish—like fire Neil out of pettiness and spite because he took part in this legal action.
So this is going to be a fun one to watch. It will surely be an object lesson for all: Executives and managers will get an look at what happens when a star employees confronts the boss, and workers will get a visceral thrill from seeing what happens when one of their own spits (figuratively, of course) in the owner’s face.
HSM, a company that puts on interesting conferences like the World Business Forum, has been branching out into more personal events called “intensive seminars.” These are events where you can spend a day or two in a smallish group (100 people or so) listening to and rubbing shoulders with people like Jack Welch and Tom Peters for anywhere from $4,500 to $10,000.
I’ve always questioned the value of pricey programs like these because I don’t know how much more someone like Jack Welch is going to tell you in a group of 100 people that you just can’t get from reading his books or reading (or listening to the podcast of) his BusinessWeek column. But despite my skepticism over the cost-benefit ratio of these “intensive seminars,” I don’t doubt for a moment the quality of speakers like Welch and Peters, because they have long records of notable accomplishment.
HSM wanted nearly $5,000 per person for a one-day session with the former Disney CEO where participants “will have the opportunity to work with one of the world’s most creative icons on how to successfully foster creativity and implement innovation in your organization.”
I don’t believe anyone can read DisneyWar and not come away wondering how Eisner kept his job running Disney for as long as he did. Forget his unbridled ego and over-the-top narcissism; what shocked me were the way he ran through executives and subordinates, his total disregard for people and talent, and his terrible decision-making skills. This was a man who sold off all the rights to the Disney-produced hit The Sixth Sense with Bruce Willis; who passed on TV staples like CSI and Survivor; who belittled Lost even as it garnered great ratings on Disney-owned ABC.