Stuart Galbraith Posted January 14, 2020 Share Posted January 14, 2020 Ford? I can't think of many others I fear. Link to comment Share on other sites More sharing options...
RETAC21 Posted January 14, 2020 Share Posted January 14, 2020 That supports every preconceived idea I had about what was going wrong with Boeing. The accountants took over an engineering company and ran it into the ground. How many times did we see THAT happen with British industry? What accountants? there are no accountants in that tale, what you have is people that have worked as highly paid consultants to roll out the same solution to every square peg to fit a round hole that then go on dancing to the tune of the markets as deifned by stock analysts. There are no accountants in that tale. Link to comment Share on other sites More sharing options...
Stuart Galbraith Posted January 14, 2020 Share Posted January 14, 2020 That supports every preconceived idea I had about what was going wrong with Boeing. The accountants took over an engineering company and ran it into the ground. How many times did we see THAT happen with British industry? What accountants? there are no accountants in that tale, what you have is people that have worked as highly paid consultants to roll out the same solution to every square peg to fit a round hole that then go on dancing to the tune of the markets as deifned by stock analysts. There are no accountants in that tale.When I say accountants, I mean people obsessed by the fiscal cost of everything. You can be a managing director, and still an accountant in mindset. By way of illustration, I remember when Bush setup a new commander of Centcom, whom he said would win the war on terror. Instead he spent all his time trimming the cost of his command, getting rid of guards, trimming cold war infrastructure, instead of commanding. Because he was an accountant in mindset. Link to comment Share on other sites More sharing options...
Adam Peter Posted January 14, 2020 Share Posted January 14, 2020 When I say accountants, I mean people obsessed by the fiscal cost of everything. You can be a managing director, and still an accountant in mindset. When you say accountants, you are dead wrong here. I am working with accountants since 1997, except between 14-17. The accountant mindset is that the numbers must be correct. There is no oversight, there are at least two equations that must yield the same result, and if you and your late invoice causes this imbalance, you will be phoned in every ten minutes hoping that you have found it - or at least got a certified copy. Link to comment Share on other sites More sharing options...
DB Posted January 14, 2020 Share Posted January 14, 2020 It is my opinion that people who purposefully embark on MBAs early in their working life are the people who will tend to make business decisions that are purposely designed to provide immediate personal enrichment. For example, if they find themselves as VP for paperclip management, they will choose to reduce the cost to the company attributed to paperclips by changing suppliers to the cheapes clipst, without regard to the ability of the cheapest clips to actually clip paper to the standard required by the company. They will also lock paperclips away in a cupboard and demand that a paperclip requisition form be completed and counter-signed by the VP of the department that wants to use paperclips, and they will in no way allow for the productivity lost due to filling in the forms and chasing for the signatures to be offset against their budget. At the end of the year, the VP of paperclip management will take home a large bonus, enrich his resume with this success story and then flit off to some other non-role before the time wasted to the stupid clip management process cause the company he was working for to collapse because all its products were late and under-engineered due to management overhead. MBAs like this are experts at only one thing - surfing the leading edge of the catastrophe wave that is the accumulation of the consequences of their actions. By the time they make it to Muilenberg's level, even when they fail hard and wipe out, they have enough accumulated wealth to not give a shit. Latest claim is that Muilenberg walks away with $62 million. The above parable of the VP of paperclips is not an entirely original work. Link to comment Share on other sites More sharing options...
Nobu Posted January 14, 2020 Share Posted January 14, 2020 (edited) The peer department heads who are agreeing to sign off on the above model are often doing so as much to guarantee that their own initiatives for personal gain will be signed off on in turn, than almost any other consideration. In the Bureaucracy of Anything, the manager behind the manager is responsible for hooking the golden parachute to the static line before the green light to exit the corporation goes on, so to speak. Edited January 14, 2020 by Nobu Link to comment Share on other sites More sharing options...
Jeff Posted January 14, 2020 Share Posted January 14, 2020 I think Stuart's point is well taken whether we go down the rabbit hole of accountants/not accountants or not. They are often referred to as beancounters or green eyeshade types. DB explains it well as well. Link to comment Share on other sites More sharing options...
sunday Posted January 15, 2020 Share Posted January 15, 2020 The Dilbertization of Boeing. Link to comment Share on other sites More sharing options...
cjpaul Posted January 15, 2020 Share Posted January 15, 2020 (edited) https://www.newyorker.com/magazine/2019/11/18/the-case-against-boeing Also from same article: "Updating the plane introduced some engineering difficulties. The new model had larger engines, and it was hard to find room for them on the low-slung 737. Boeing decided to place the engines farther forward, just in front of the wing. The new position, and the greater thrust of the engines, produced an aerodynamic challenge during a maneuver called a windup turna steep, banked spiral that brings a plane to the point of stall, which is required for safety tests, though its rarely used in typical flying. On most airplanes, as you approach stall you can feel it, a veteran pilot for a U.S. commercial carrier told me. Instead of the steadily increasing force on the control column that pilots were used to feelingand that F.A.A. guidelines requiredthe new engines caused a loosening sensation. To correct this, Boeing settled on a software feature called the Maneuvering Characteristics Augmentation System. As the nose of the jet approached a high angle, suggesting an oncoming stall, mcas would adjust the stabilizer on the planes tail, pushing the nose down, to alleviate the slackness in the control column. They were trying to make it feel the same, so the pilots wouldnt require training, the pilot said. Boeing had gone so far as to promise to pay Southwest Airlines, which flies 737s almost exclusively, a million dollars per plane if training on a simulator was found to be necessary." So the MCAS system was put in place solely to make the 737 MAX feel like an older 737. Just plain dumb. Edited January 15, 2020 by cjpaul Link to comment Share on other sites More sharing options...
EchoFiveMike Posted January 15, 2020 Share Posted January 15, 2020 Money grubbers. When the pogues are concerned with the value of the stock, your true product is the stock, not the supposed product. The other issue is accountability, the "golden parachute" is exactly 3200 mils out from what is required in a successful endeavor. You reward failure, you get failure. If you garroted these vermin when they committed these sorts of failures, even after they try to flee to Barbados or whatever, you will soon have fewer vermin. This is why all paper pushers/money grubbers/pogues must be curb stomped, constantly. Nothing really ever moves past high school. These same people who always cried to "amenable authorities" are the same today, and should still be stuffed into the locker. S/F...Ken M Link to comment Share on other sites More sharing options...
Stuart Galbraith Posted January 15, 2020 Share Posted January 15, 2020 When I say accountants, I mean people obsessed by the fiscal cost of everything. You can be a managing director, and still an accountant in mindset. When you say accountants, you are dead wrong here. I am working with accountants since 1997, except between 14-17. The accountant mindset is that the numbers must be correct. There is no oversight, there are at least two equations that must yield the same result, and if you and your late invoice causes this imbalance, you will be phoned in every ten minutes hoping that you have found it - or at least got a certified copy. Ok, so im unfair to accountants, and as I use one myself they have my fulsome apologies. But the alternative would be to say bottom line obsessed middle and top management, which is a muddily way of say what I assumed was fairly clear, but evidently was not. I think Stuart's point is well taken whether we go down the rabbit hole of accountants/not accountants or not. They are often referred to as beancounters or green eyeshade types. DB explains it well as well.Beancounters might have been better. Link to comment Share on other sites More sharing options...
Ssnake Posted January 15, 2020 Share Posted January 15, 2020 I always associate detail-obsessed petty-minded people with "beancounter", people who can't see the big picture. They would not do this to enrich themselves but out of a false sense of diligence. To that extent it would be unfair to beancounters to associate them with bonus-hunting sociopaths either - but of course we have to simplify somehow for the sake of clarity in expression.At the end of the day the fundamental problem lies in the question how people are being incentivized. If the board of directors gets a bonus for stock performance you shouldn't be surprised that they do everything they can during their limited number of years in office to push exactly that, the stock price (and set corresponding incentives down the chain of command). Of course the stock holders should reward them for building safe planes in a profitable manner but that's hard to operationalize. And you actually have different kinds of stock holders - short-term speculants and long-term investors. Their interests do not necessarily overlap. Link to comment Share on other sites More sharing options...
Stuart Galbraith Posted January 15, 2020 Share Posted January 15, 2020 Being a railway enthusiast, It makes me think of Dr Richard Beeching, the man who filleted Britain's railways from about 20 thousand miles of track to 12. His brief was to get costs down, so he figured, right Ill get rid of the branch lines, they lose money. So he did. And at the end of it, the railways were losing just as much money as before the cut the lines, despite the lines were loss making. Why? Well it turns out there was a thing called Branch line economics, which Beeching didnt understand. The Branch line was a loss leader. Nobody expected it to make money, and they probably hadnt since the turn of the last century. But it created trade for the main lines in passengers. The passengers that used the Branch line would usually go further than the first mainline station they met. So they had the fares reflect this. The journey over the Branch wouldnt make any money, but the journey to the main destination would. Of course cars and buses interfered with these economics, but the logic held true. That is until the branch lines were shut. Then everyone said 'sod it, if I have to drive to the mainline station, I may as well drive all the way to my destination' and they lost as much money as they saved from closing the apparently economic failing infrastructure of the branch, because those people were not using the railway anymore. The real problem was not the branches or the passengers, it was the loss of freight trade to the roads via the lorry. Something that Beeching did absolutely nothing to reverse. In fact he took the decision to shut down passage of fish to London via the railway, despite the fact it was breaking even, and despite all new rolling stock to carry it had just been purchased. This all illustrates a man obsessed with the bottom line and details, and missing the big picture. The UK has been bedeviled with such people from the 1950's. They have in my view been as much responsible for wrecking British industry as the more militant unions have been. Perhaps more so. Link to comment Share on other sites More sharing options...
Ssnake Posted January 15, 2020 Share Posted January 15, 2020 Smart & Diligent: No problemSmart & Lazy: No problemDumb & Lazy: No problemDumb & Diligent: Problem. Link to comment Share on other sites More sharing options...
RETAC21 Posted January 15, 2020 Share Posted January 15, 2020 At the end of the day the fundamental problem lies in the question how people are being incentivized. If the board of directors gets a bonus for stock performance you shouldn't be surprised that they do everything they can during their limited number of years in office to push exactly that, the stock price (and set corresponding incentives down the chain of command). Of course the stock holders should reward them for building safe planes in a profitable manner but that's hard to operationalize. And you actually have different kinds of stock holders - short-term speculants and long-term investors. Their interests do not necessarily overlap. This is exactly the problem, it's not the beancounters or the bottomline, I am sure Amazon or Facebook have their share of beancounters, yet the businesses are profitable in the long term because the owners have a vested interest in success. Many public quoted companies do not anymore, as multiple funds and shareholders have a vested interest in the shortest term profits and reward its management accordingly. This message then goes down the chain to the lowest executive - as an example, my country manager's expectancy on the job is around 8 years - problems that go beyond that term are not something he cares about - so the people get older, resources are not invested and in 8 years his replacement will wonder why we can't do things we used to do. Link to comment Share on other sites More sharing options...
Leo Niehorster Posted January 17, 2020 Share Posted January 17, 2020 For the pennypinchers. When I worked for Hertz Rent-A-Car, we were issued pencil lengtheners. Only when the stub was too short to fit into the slot, were we finally issued new ones. --Leo Link to comment Share on other sites More sharing options...
Stuart Galbraith Posted January 17, 2020 Share Posted January 17, 2020 Well, I know one railway company in the UK in the 1930's that demanded that all employee's rake any usable coal out of the grate of station fireplaces, and reuse it if possible. Although to be fair, as it was the only company still paying out dividends postwar, maybe it had something to commend it.... Link to comment Share on other sites More sharing options...
Jeff Posted January 17, 2020 Share Posted January 17, 2020 For the pennypinchers. When I worked for Hertz Rent-A-Car, we were issued pencil lengtheners. Only when the stub was too short to fit into the slot, were we finally issued new ones. --Leo And how much did the pencil lengtheners cost versus the amount of saved pencil? Link to comment Share on other sites More sharing options...
Nobu Posted January 17, 2020 Share Posted January 17, 2020 Maybe not much, but I am impressed by it, for its impact on the mentality alone. Link to comment Share on other sites More sharing options...
Stuart Galbraith Posted January 17, 2020 Share Posted January 17, 2020 if it was bored out, it could make a dual purpose pencil holder/blowpipe. MI6 im sure would be interested. Link to comment Share on other sites More sharing options...
Leo Niehorster Posted January 17, 2020 Share Posted January 17, 2020 For the pennypinchers. When I worked for Hertz Rent-A-Car, we were issued pencil lengtheners. Only when the stub was too short to fit into the slot, were we finally issued new ones. --Leo And how much did the pencil lengtheners cost versus the amount of saved pencil? But you could reuse the holders indefinitely for innumerous stubby pencils.Did I mention that you had to turn in the stub to get the new pencil? --Leo Link to comment Share on other sites More sharing options...
Nobu Posted January 17, 2020 Share Posted January 17, 2020 That is why Germany will win. Link to comment Share on other sites More sharing options...
Tim the Tank Nut Posted January 17, 2020 Share Posted January 17, 2020 where have I heard that before? Link to comment Share on other sites More sharing options...
RETAC21 Posted January 17, 2020 Share Posted January 17, 2020 For the pennypinchers. When I worked for Hertz Rent-A-Car, we were issued pencil lengtheners. Only when the stub was too short to fit into the slot, were we finally issued new ones. --Leo And how much did the pencil lengtheners cost versus the amount of saved pencil? But you could reuse the holders indefinitely for innumerous stubby pencils.Did I mention that you had to turn in the stub to get the new pencil? --Leo Somewhere, in a secret warehouse millions of pencil stubs await their day, patiently... Link to comment Share on other sites More sharing options...
RETAC21 Posted January 17, 2020 Share Posted January 17, 2020 Blunders, corporate blunders everywhere: https://youtu.be/T0Z73Zbtlyg Link to comment Share on other sites More sharing options...
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