Thread regarding McDermott International Inc. layoffs

McDermott: Bullied to Oblivion.

Once upon a time McDermott were a bright shining star in the offshore construction industry, market leaders, developed a global presence and garnered global respect.
Sadly, there is no happy ending to this cautionary tale of a once great company crumbling before ones eyes.
The current CEO assumed his role in 2013 on a wave of optimism. He was a fresh new face, not associated with the executives who had handled McDermott for the previous 10 years, and who had muddled through downturns and performance issues.
There was already change underway internally prior to the CEO’s appointment, with a number of people recruited to help turn around the company, modernize, streamline, perhaps even bring it back to greatness. They were good people, professional, experienced, excited for the future, and generally rebuffed by the old guard at McDermott who saw them as a threat, and resisted change. They resisted change for good reason, the senior management were on such sweet deals, such great bonuses, fabulous expatriate deals, some of which had been in place for over 25 years. Singapore and Dubai were the worst. Both offices had horrendous overheads, unsustainable as the oil price started to tumble in 2014.
This was what the new CEO walked into, change and decline. Unfortunately, this became the mantra of his tenure to date: Change and Decline.
He took his time getting to know the business, this was his first position as head of an international company and he wanted to get it right.
He started to get it wrong straight away.
In 2014 he started to bring in people whom he knew, people whose only redeeming qualities were the ability to shout, bully and tell the CEO what he wanted to hear.
This is the CEO’s Achilles heel, his loyalty to people who aren’t very good at what they are supposed to do. People who believe that shouting the loudest make you a leader, not realizing that it only makes you a bully.
And shout and bully they did. Swearing and cursing in meetings with impunity, isolating people, touring their “domains” demanding that certain people be fired, simply because they didn’t look busy enough.
It became the worst place to work. Many people suffered in silence, afraid to speak out as it would cost them their jobs, knowing that reporting any of these people to HR would do nothing. There are dozens and dozens of people globally who had valid reasons to expect HR to act, verbal abuse, s-xual intimidation, mental abuse. It would not be a surprise to anyone that of all the complaints made to HR, there are no records of any, or of any remedial actions. The bullying continues.
People began to say whatever it was they thought the bosses wanted to hear.
The company tried to cut costs everywhere, but a simple check on the bonuses paid to the top executives will show few cuts there. No-one could fly business class anymore, unless you were one of “the boys”, No-one could expect any relief from the grinding pressure to cut costs, unless you were one of “the boys”.
By the end of 2016 the first group of people brought in to help McDermott change and grow were gone, replaced by people who would follow the party line, who wouldn’t question the bullying, the abuses. People who would do “the boys” bidding.
Change and decline.
McDermott “merged” with Chicago Bridge in 2018, in a move which the board hoped would put them on a par with other tier 1 contractors in their ability to provide a full service, onshore/offshore. The total package.
As with all such endeavours, some people were sacrificed during the process. None of “the boys” were included however, only those that had some experience in onshore construction. Only Chicago Bridge people it seemed.
The merger has been fraught, cost overruns on heritage CB projects seemed to come as a huge surprise to the CEO, cost overruns on heritage McDermott projects were ignored, all this quickly dented the initial anticipation of a rosy future.
Cost cutting became even more pervasive, with business sectors being sold off in order to help balance the books. Promises of better performance were made during every financial reporting period. Bad results were always “unexpected”. Confidence that the corner had been turned was high. More cost cutting, more bullying.
Still “the boys” enjoyed immunity from any criticism, all hiding behind “unknown” factors” and “unexpected losses”. The new share price initially at $22 has dropped to below $6 a number of times. “The boys” were moved around, new positions, better bonuses, same problems. They still had expensive retreats, chummy golf gatherings, and exhorbitant expense accounts.
More managers and directors have been brought in, but they can not change the mannerisms and attitudes emanating from the top because they are on the fringes.
The changes continue, the bullying goes on, the vast majority of employees are now turned off, just going through the motions to allow them to keep their jobs.
The most surprising thing for outsiders is the apparent inaction by the Board of directors. But look closely, for this is one the CEO’s few successes: he has staged what could be considered a coup. Look at the makeup of the board today versus the makeup when the CEO took over. The majority of heritage Board Members have gone, replaced with appointees of the CEO. Replaced with some of “the boys”. The Board no longer has the ability or the will to censure the CEO, quite the opposite, the CEO now controls the board.
So now we have a situation whereby a great majority of Board members owe their allegiance to the CEO, owe their salaries and inflated bonuses, their perks and their privileges to the CEO. And they will bully any subordinate they want to, blame any unforeseen event they need to, remove anyone they want to, just to keep their status.
McDermott could be great again, but it needs someone to wrest control from “the boys”, if that doesn’t happen then it may just be bullied into oblivion.

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Post ID: @1168ykGS

9 replies (most recent on top)

I dismissed this initially as I didn't want to believe what was written, but it seems the author was right.

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Post ID: @1168ykGS-1Grgm

as insightful as a cold read

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Post ID: @1168ykGS-1jjku

True in all aspects

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Post ID: @1168ykGS-1iyxy

Whoever wrote this was obviously familiar with the players and got it spot on.
Does this level of mismanagement border on the criminal?

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Post ID: @1168ykGS-12wxj

This cannot be argued with. well done OP, what on earth have these people done to M

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Post ID: @1168ykGS-Sjgz

I have known DD for a long time, and often his ego gets in the way. He appointed SS in 2014 and supported him to the point of stupidity, not through loyalty, but through inability to let him go. DD doesn't fire people, he doesn't have the balls. Look at the love letter he wrote to the excom member recently "resigned" This person was undoubtedly the most hated person in MDR, had zero credentials or ability to perform the many roles he was shoehorned into, yet DD could not see it. Even buried the very many ethics complaints about this person, c/o the head of HR. His loyalty is blind.
He is a used car salesman, nothing more, and he's been found out. Hopefully the rest of his squad will soon go too.

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Post ID: @1168ykGS-Mkep

Hard to disagree with anything OP has written. Just look at the names of the "leadership team" (excom)... every one (some more than others) bear a responsibility for this shambles.

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Post ID: @1168ykGS-glvl

Wrong man for the job. A mediocre company, a cosmetic fix that masked systemic problems. Fist pumps all around! Then a misguided WAY-overvalued acquisition driven by the CEO's ego. How on Earth did they get to a $4bn valuation? How did they not understand the expected costs of these fixed fee projects that they themselves said were underbid and could not be fixed? "Not our fault. These contracts were underbid from the start. Can't do anything about them." EXCEPT MAYBE NOT BUY THEM IN THE FIRST PLACE!! Make no mistake, these project cost were costs, not even "risk".

But quarter after quarter they swore they now had their arms around how bad things were. Next quarter, SURPRISE! But we're serious this time, really, we swear.

Not this last quarter, you could hear it in their answers, in their tone. Something was different. Not so c–ky.

They don't understand Onshore, the fundamentals of a much harder business. Why do you think Technip is spinning their high risk business?!! It's too hard, too risky!! And deadly if you don't know what you're doing!

Remember cultural integration? Declared a complete success by the winners put in charge of it. What a joke. Just another box that needed to be checked to convince the echo chamber that the risks were being managed. Did anyone ask the employees what they thought? No, "there's the door." Did anyone care if you quit? Only if you got a retention bonus, lot of wasted money! Did anyone pay attention to the employee discontent? Or did they ignore and then bully the posts here?

So is the c suite being swept clean finally?

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Post ID: @1168ykGS-2hzx

finally. someone said it.

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Post ID: @1168ykGS-1ccb

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