2. Alignment of managers goals with the shareholders goals
This is a special case arising from the first point above. See the argument for the first point is often that "well the managers should do it, they're paid to do so, and they're paid to make the share price go up etc etc". Well.... No. This is another "right thing to do" that is a bitch to execute.
The commonly accepted way to align goals of managers with shareholders is to give them a large stock grant. Do you think this aligns the interests of managers and shareholders? Nah. All this does is makes them want more stock.
Look, none of these bitches will get fired if the stock price takes a dive. They will just blame it on the economy or the misguided bombers or the hurricane in some hapless coastal town. So, while they stand to benefit if the stock price goes up (or stays level), they stand to really benefit if they get more stock.
The way I look at it, most top managers are already fairly well off, cash wise. And the cash component of their salaries is still nothing to sneer at. So if you give them two options (a). Work hard, deliver bigger market share or higher margins and (b). Convince your boss you're a star so you get more stock, which one do you think they will choose?
Most of these Management Bullshit Artists are good are presenting forcefully their cases - however strong or weak the facts of the matter may be. So like their more evidently bastardish weasel brothers the lawyers - they cleverly plead their way into the top bracket. See the section above on pay for performance?
3. You're just like them
Every individual is motivated by self preservation first and self actualization last. And in the middle are so many factors that mess around with his brain - emotions, perceptions, marketing, etc. You can tell me that you're not one of them, but don't tell yourself that.
All else being equal, maybe some people would do good for others. But if that action starts influencing YOUR payout.... that's when things get messy.
So whats the point of this seemingly interminable blog post?
1). People are all looking out for themselves. You are too.
2). If you want them to do things that are good for you, you have to fool them into thinking that those things are good for them too.
Do The Right Thing My Ass.
I have been speaking to a few of my friends lately who regularly lament the machinations of their top management. Apparently a lot of their actions are not "the right thing" for the employees. A lot of them (the senior management) seem to be doing things that don't seem to be in the benefit of the company as a whole.
I can understand their anguish and frustration. What I do not understand is their surprise.
See doing the right thing requires altruism. You have to want to do something that is good for others, without a regard for what benefit or cost it may bring you. Altruism is a scarce virtue among humans in general, and given the fact that the echelons of senior management are populated mainly by conniving weasels, we can safely assume that in that rarefied atmosphere it is, even more dismayingly, absent.
For all the talk of values and shareholders, the thing that drives managers is 'what's in it for me?' (And in this post when I say managers I mean the top two or three levels of the company)
Every one of them is out to further his own fief, and satiate his giant ego. There are three reasons why these people will not do the right thing. I tried to explain these three items to my deluded friend yesterday, and I will repeat the gist of them here.
One point per post coz otherwise it's too long...
And today's point is:
1. Doing the right thing is hard
A lot of what is touted as the "right thing to do" is simple to say but very difficult to execute. For example - take maddening phrase "Pay for performance". Sounds deceptively simple and seems hard to think of an argument against it. But what a bitch to execute! The devil, as usual, is in the details - residing in the weeds where these philosophies are implemented, not in the clouds where they are formulated. Consultants and their management books often talk about promoting your stars and weeding out your laggards. Great idea. But there are a few complications in implementation.
First is identifying the stars. Who is a star? Someone who did a good job this year? This past six months? Think about the Indian cricket team. Who is your star? Ask ten people to cut the Indian team into the common five performance categories. I bet you get at least 5 different answers or categorizations. Same thing in organizations. Although all the books and papers tell you that you should define the job, set objective goals and so on, all that is terribly difficult to do in a business. Situations change, goals change, and frankly if managers were to do a fair enough job, that would take about 50% of their time. And they just don't spend that much time on it. So they go by gut feel and recency effects - see one admission here.
Second problem - how to rate. Forcing a normal (Gaussian) distribution for the 5 categories is hogwash. The groups that the distribution are forced upon are neither random, nor independent, and sometimes not even large enough to justify the expected fit even in theory (see Central Limit Theorem). Even if the distribution expected is not Gaussian, How much thought do you think your organization put into your distribution? Can they explain to you why 10% of the organization should be in the bottom category while only 5 at the very top (or vice-versa?)
Third problem - How much to differentiate. Say you got 5 categories. You're giving your top category guys a 20% raise, and your bottom guys a 0. What about the guys in the middle? 10? 15? 18.6? It's not a trivial discussion. Sure you should love and nurture your top guys and weed out your bottom performers, but what should you do about the bulk in the middle? The last thing you want to do is shit on them because they provide the raw horsepower that your stars need to get their results. I think you should love them too. Maybe not as much as your top guys, but hey, share the love.
So the point is, it's all nice to say the managers should do the right thing. But given how hard it is, do you think they will do it? That brings me to the next point.
I can understand their anguish and frustration. What I do not understand is their surprise.
See doing the right thing requires altruism. You have to want to do something that is good for others, without a regard for what benefit or cost it may bring you. Altruism is a scarce virtue among humans in general, and given the fact that the echelons of senior management are populated mainly by conniving weasels, we can safely assume that in that rarefied atmosphere it is, even more dismayingly, absent.
For all the talk of values and shareholders, the thing that drives managers is 'what's in it for me?' (And in this post when I say managers I mean the top two or three levels of the company)
Every one of them is out to further his own fief, and satiate his giant ego. There are three reasons why these people will not do the right thing. I tried to explain these three items to my deluded friend yesterday, and I will repeat the gist of them here.
One point per post coz otherwise it's too long...
And today's point is:
1. Doing the right thing is hard
A lot of what is touted as the "right thing to do" is simple to say but very difficult to execute. For example - take maddening phrase "Pay for performance". Sounds deceptively simple and seems hard to think of an argument against it. But what a bitch to execute! The devil, as usual, is in the details - residing in the weeds where these philosophies are implemented, not in the clouds where they are formulated. Consultants and their management books often talk about promoting your stars and weeding out your laggards. Great idea. But there are a few complications in implementation.
First is identifying the stars. Who is a star? Someone who did a good job this year? This past six months? Think about the Indian cricket team. Who is your star? Ask ten people to cut the Indian team into the common five performance categories. I bet you get at least 5 different answers or categorizations. Same thing in organizations. Although all the books and papers tell you that you should define the job, set objective goals and so on, all that is terribly difficult to do in a business. Situations change, goals change, and frankly if managers were to do a fair enough job, that would take about 50% of their time. And they just don't spend that much time on it. So they go by gut feel and recency effects - see one admission here.
Second problem - how to rate. Forcing a normal (Gaussian) distribution for the 5 categories is hogwash. The groups that the distribution are forced upon are neither random, nor independent, and sometimes not even large enough to justify the expected fit even in theory (see Central Limit Theorem). Even if the distribution expected is not Gaussian, How much thought do you think your organization put into your distribution? Can they explain to you why 10% of the organization should be in the bottom category while only 5 at the very top (or vice-versa?)
Third problem - How much to differentiate. Say you got 5 categories. You're giving your top category guys a 20% raise, and your bottom guys a 0. What about the guys in the middle? 10? 15? 18.6? It's not a trivial discussion. Sure you should love and nurture your top guys and weed out your bottom performers, but what should you do about the bulk in the middle? The last thing you want to do is shit on them because they provide the raw horsepower that your stars need to get their results. I think you should love them too. Maybe not as much as your top guys, but hey, share the love.
So the point is, it's all nice to say the managers should do the right thing. But given how hard it is, do you think they will do it? That brings me to the next point.
Mumbai and the Marathi Manoos
I must profess ignorance about the Marathi Manoos.
Who is he?
A person with domicile in Maharashtra?
A person who can speak Marathi?
A person whose mother tongue is Marathi?
A person both of whose parent's mother tongues are Marathi?
I want to know because this person seems to be wanting a special status in Maharashtra.
Now special status in and of itself is not new - There is a special status for certain people in Kashmir, for some people in the North Eastern states, and whats more, for certain caste/community/tribe based groups there is a special status for all over the country.
But what is funny about this special status for the Marathi Manoos is what the leaders of this "movement" seem to be demanding. Sample this:
Some RSS leader came out recently and exhorted his cronies to protect the whimpering migrants, to which some Sena leader has reacted by warning the RSS guys to stay away from issues in Mumbai.
I don't know if the Marathi Manoos actually understands what their leaders are asking for:
100% reservation, Ownership of their city, Squelching opinion, and prevention of other citizens of India from coming in there.
That is another way of saying isolation.
Is that what the real Marathi Manoos wants?
The Sena leaders are braying over the airwaves that they have the unflinching support of the Marathi Manoos. But do they?
And if so - back to my first question - who the hell is this Marathi Manoos supporting these retarded views?
If you know, please enlighten me.
And another thing.
Their whole argument rests on the confidence they have that people want to move to Mumbai.
India's own city of opportunity.
That city is the city of opportunity as much BECAUSE of the migrants as before it. These leaders didn't make it the city of opportunity. They just changed the bloody name!
And you know if these Marathi Manooses really want it - Fuck it. Build a wall around them, and let them have the god damned city to themselves.
We've got other ports.
And the finance and software industry can move pretty quickly.
And Bollywood? Really? Should we even care to address THAT situation?
Let them drive their taxis and speak to each other in only Marathi and descend into a state of chewing destitution.
Lets see how they like that scenario.
Who is he?
A person with domicile in Maharashtra?
A person who can speak Marathi?
A person whose mother tongue is Marathi?
A person both of whose parent's mother tongues are Marathi?
I want to know because this person seems to be wanting a special status in Maharashtra.
Now special status in and of itself is not new - There is a special status for certain people in Kashmir, for some people in the North Eastern states, and whats more, for certain caste/community/tribe based groups there is a special status for all over the country.
But what is funny about this special status for the Marathi Manoos is what the leaders of this "movement" seem to be demanding. Sample this:
- 100 % reservation for them in government and private jobs
- Prevention of all industrialists or sports personalities from making political comments
- The same status Mumbai is the same as the status of the Chairman and Managing Director within a company
- Authority to treat all migrants to their home city (and possibly even the rest of the state) as disease ridden hyenas and beat them back physically like the thieving bastards they surely are.
Some RSS leader came out recently and exhorted his cronies to protect the whimpering migrants, to which some Sena leader has reacted by warning the RSS guys to stay away from issues in Mumbai.
I don't know if the Marathi Manoos actually understands what their leaders are asking for:
100% reservation, Ownership of their city, Squelching opinion, and prevention of other citizens of India from coming in there.
That is another way of saying isolation.
Is that what the real Marathi Manoos wants?
The Sena leaders are braying over the airwaves that they have the unflinching support of the Marathi Manoos. But do they?
And if so - back to my first question - who the hell is this Marathi Manoos supporting these retarded views?
If you know, please enlighten me.
And another thing.
Their whole argument rests on the confidence they have that people want to move to Mumbai.
India's own city of opportunity.
That city is the city of opportunity as much BECAUSE of the migrants as before it. These leaders didn't make it the city of opportunity. They just changed the bloody name!
And you know if these Marathi Manooses really want it - Fuck it. Build a wall around them, and let them have the god damned city to themselves.
We've got other ports.
And the finance and software industry can move pretty quickly.
And Bollywood? Really? Should we even care to address THAT situation?
Let them drive their taxis and speak to each other in only Marathi and descend into a state of chewing destitution.
Lets see how they like that scenario.
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