The leadership team has been laying people off to meet profitability goals for years. That's it. They're a one-trick pony with no new or good ideas. All they know how to do is lay off more people - preferably those who are the highest earner to maximize the effect - to make the failing numbers look better. How do they all still have jobs?
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No they're not. They're managing to their bosses, not the workers.
That being said, to judge whether they're good or not, don't use the stock price. Of course, the way incentives for CEO goes, it's the only metric that counts for them. The real indication is whether they left company in better situation than when they took the helm: use a host of metrics, not just share price.
Bingo. Sad to say, but the only original ideas I’ve seen have come from band 8 and below employees and a few rare, non-managerial upper bands.
Leadership is a line of 20 people relaying a message and some poor kid fresh out of undergrad having to actual perform the task.
To @1by
You missed this gem:
Commencing with the month of January 2021, IBM shall pay you a monthly amount to cover your costs incurred in engaging in business travel on IBM’s behalf, including travel from your Manhattan office to IBM’s Armonk headquarters as well as your personal security related thereto, up to $12,500 per month
Cohn’s letter of offer (accessible via the link below) indicates he receives $2.75 million per year. He also received a $7 signing “new hire equity grant” (what can’t they just call it a bonus?) to vest over three years, plus $10 million of a thing called a “sign on equity grant”, to be paid in stock.
So let’s say that the total compensation over four years is $28 million, assuming performance targets are met, which of course, they will be deemed to have been.
IBM needs to sell a lot of hardware, software and services to pay Gary.
What the fu-k does a Wall Street wonk do to earn that king of money at a tech firm, other than to give inside access to the Street and perhaps Washington? The whole thing is absurd, obscene, and illustrates the rot in the entire US corporate, financial and political system. Did he create the firm? Has he risked anything? Invented anything? No to all three questions. He’s just a steward of capital, like the rest of the professional manager club who think that they deserve to be paid a fortune.
These guys above the work line and have contributed if not created the income and wealth disparity that characterizes the US these days.
Nice profile on Gary from Vanity Fair magazine:
But what about Gary Cohn, another Goldman Sachs veteran who spent 14 months as Trump’s first director of the National Economic Council and as an adviser to the president on economic policy? Is he toxic? Cohn, you will recall, was the former president and chief operating officer at Goldman Sachs—essentially the number two executive at the firm when Lloyd Blankfein was the CEO. When, around the time of the 2016 presidential election, Cohn’s own power play to succeed Blankfein failed, he left Goldman. Jared Kushner introduced Cohn, a lifelong Democrat, to Trump. After a few meetings at Trump Tower during the transition, Trump offered Cohn a top job in his administration. They had never met before the election. Cohn quickly accepted Trump’s offer.
Lots of people thought Cohn was nuts to associate with Trump. But Cohn believed he could do more good working at Trump’s elbow day after day than he could from an outside perch. He hoped to temper Trump’s baser instincts. How quaint. He also likely figured working in the White House would be a resume enhancer. While Mnuchin got the credit publicly for shepherding the 2017 tax cut through Congress, it was really Cohn who was the driving force. Despite repeated public clashes—especially over Trump’s statements after the deadly Charlottesville protests—Cohn was basically a good soldier. He pined for another position in Washington. Maybe as Trump’s chief of staff, or as chairman of the Federal Reserve? Neither job materialized.
Cohn quit in March 2018, having witnessed on a daily basis Trump’s vile and incompetent behavior. He shared nothing publicly about Trump and his atrocious antics. (He was likely a blind source for Bob Woodward’s 2020 book, Rage. Cohn shared with me, in April 2018, plenty of revealing anecdotes about his daily visits with Trump in the Oval Office but then refused to let me publish them.) Why risk a nasty presidential tweet, or a future business opportunity? Why do the right thing? After all, he was getting between $200,000 and $250,000 a pop for speaking gigs and started investing in a number of start-ups, and he now serves on the boards of companies with names such as Abyrx, Gro Intelligence, Indago, Nanopay, and Starling. He is also the chairman of the board of Pallas Advisors, a Washington consulting firm.
He had the sense to quit the White House job, but, then again, having lived in New York, he would have known what a piece of sh-t Trump was in the first place. Temper Trump’s impulses? No intelligent person would ever think such a thing was possible. It was all about the corporate-Wall Street-Washington grift.
@1apr, I object. Gary is a crook and IBM should have never hired him regardless of his experience and where he came from. God knows we need more of those in IBM.
The leadership team is not incompetent.
- 5 years after https://newsroom.ibm.com/gary-cohn-2
So, why did IBM hire him?
Good looks? IT experience? Positioning the company so the stock market sees IBM in a positive light?
https://contracts.justia.com/companies/ibm-700/contract/223320/
My calculator cannot add that many zeros.
IBM stock:
Jan 2021: Low 120, High 126 (for the month)
July 25 2022: 127.9-129.12
The stock flirted with 145 both in June 2021 and June 2022
And anyone that came in with the Cognos acquisition
Dump most the PM's too, they're just paper pushers with no tech skills.
It's easier to cut costs than to increase revenue. Especially, when customers don't like you - Middle Mgmt Belief.
AK is blind, an id--t and has shown absolutely no results throughout his career at IBM. As a matter of fact, as the SVP of the software group (Cloud and Cognitive), he totally destroyed the ORG. When he inherited the ORG from Robert Leblanc, that ORG was humming and highly profitable under LeBlanc. By the time AK became CEO, that ORG was dead in the water. Shame on him!
@zmo Doesn't manage people. Doesn't own a P&L. Doesn't own a big customer relationship. Yet somehow is an "executive". There are hundreds of them, maybe thousands.
If AK just got rid of any Executive that doesn't manage people it would be a great economic start and a he-l of lot better place to work.
Agreed, get rid of half the managers and mission accomplished.
IBM eased into this restructuring. (the sense of urgency wasn’t an issue due mostly to low interest rates) They focused on dumping GTS (the biggest loser) while shifting to the Redhat hybrid cloud strategy. (the new purchased strategy). Covid impacted their initial plans, and they thought the HW product cycle would buy them some time. The economy and its additional headwinds is forcing IBM to feel the sense of urgency that has always been needed. IBM due to its high overhead, always says they are shifting the company to higher margin products without addressing why IBM’s overhead is high. Now they have to address that. IBM is overmanned and under consequenced. Gerstner addressed this via halving management and holding the remaining managers to the business consequences. Guess what IBM became far more efficient with 1/2 the managers even while restructuring. AK knows this, and will have to address this quite quickly if he wants to remain the CEO. Let’s hope the economic sense of urgency is contagious. IBM needs to reduce its overhead by at least 20%