Vice Presidents Anonymous is a support group for recovering VPs, much like Alcoholics Anonymous is for alcoholics. But instead of sharing stories about struggles with alcohol, we share stories about struggles with greed, sleaze, aggression, delusion, paralysis and imbecility .
Agee, Bill: Bendix
The story of Bill Agee and his time at Bendix is a fitting kick-off to 50 Years of Train Wrecks. His inflammatory personality, myopic management decisions, and ultimate tanking of Bendix is indicative of the larger shift in American corporate philosophy during the 1980's. This story is full of the Usual Suspects, with cameos from First National Bank of Boston and Kidder Peabody, and it tells a classic tale of the corporate greed and blundering that still plagues this country today.
Another leader in the movement toward maximizing value of shareholders investments as primary duty of company—the foremost objective of ''responsible management'' is ''improving the value of the shareholder's investment.''
Here is a, well, ethical rebuttal to such an idea: https://www.nytimes.com/1982/10/27/opinion/l-what-a-corporation-owes-its-shareholders-248016.html
“Short term, ruthless management style,” “Lee A. Iacocca, chairman of the Chrysler Corporation, complained that Mr. Agee, by celebrating short-term returns, cast aspersions on the business of manufacturing.”
This ruthless management style was not to be deterred by private affairs (with a headline-grabbing promotion of his belle to executive vice presidency), evidenced by a brutal stand-off in the raiding of Martina Marietta in 1982. Ironically enough, Agee dug Bendix a hole so deep it had to be bought out by Allied, a merger which resulted in his ouster.
Agee, Bill: Morrison—Knudsen
Roughly five years later, another company took a chance on Agee--Morrison-Knudsen--and Agee performed well, initially: he saved them from being raided and turned their profits around within a year or so. But things didn't smell right from the very start--Agee laid off 600 employees from the Boise-based company and high-tailed it to Pebble Beach to manage the company remotely. If that doesn't sound like alienation from the working man, what does? When he ultimately "left" MK, Boise wasn't exactly weeping at his loss:
There were rumblings, a bad quarter here, a worse quarter there, until the number for the bad quarter came and it was a loss of $310 million. Agee had cooked the books, taken gambles, and lost. He was booted fairly unceremoniously, and, in the words of the founder's widow, "good riddance."
This article, originally published in Fortune magazine, details most heavily (and poetically) the arrogant character/career of Bill Agee and the wrecks he left in his wake.
Akers, John: IBM
Akers a “product” of IBMs outdated system—had trouble refocusing IBMs attention to center on the shareholders as opposed to the customers; “required” servility to superiors causes willful ignorance of red flags
While Akers did try to decentralize and revitalize IBM, giving its businesses much more autonomy, he couldn’t save its rapid decline.
Allaire, Paul: Xerox
When Paul Allaire took the reins of Xerox in 1992, he had an ambitious vision for how the company would be run under him. In an interview with Harvard Business Review, he details his concerns with the staff-centric management of Xerox, its growing competition, and complacent marketing efforts. He was going to bring Xerox roaring into the 21st century at the top of the field for good. But something went wrong along the way. His "redesign" of the company saw the decision-making power taken out of the hands of staff and middle managers and placed in the hands of very few at the top (did someone say Elizabeth Warren?), which had come to include a character known as Rick Thoman, the new COO hired from IBM in 1997. 3 years later the SEC brings forward a complaint with Allaire and Thoman square in its sights, alleging some very cooked books. Guess the company makeover didn't go as planned?
Andersen, Roger: Continental Illinois
CI invested in developing country, took on over $1 billion in risky loans.
This is a fascinating article on how the fallout of business malpractice affects everyone involved, but also of how the Greatest Generation formed the American corporate world, in a sense, and vice versa—“the organization man,” the heart of American business ethics and manners.
''At some point,'' Myers says, ''I read or heard that there is no end to how successful somebody can be as long as they give the credit to someone else. I adopted that as my credo.''
A look into the people who make companies what they are, but are ultimately discarded by them--the downfall of the Organization Man.
Roger Anderson is the one who initiates the failure of this company and transitively, the downfall of Myers, with his new aggressive loan policy, beginning in 1976.
Waters down the internal deliberations on signing off on loans, ends up signing off on penn square, and the rest is history.
“For a while, the new ethos worked wonders. American companies became pre-eminent in such fields as autos, aircraft, energy and electronics and, in the process, gave the United States the highest standard of living ever known. But within the last decade, in industry after industry, the nation has fallen behind in innovation, productivity and market share. Many commentators believe that the very organization-man revolution that helped create America's robust economic health has contributed to its decline.”
“The rash of mergers and leveraged buyouts has also taken its toll as conquered companies have been shrunk by their new owners.”
What happened to GM in 60s an example of this bureaucracy's downside in managing companies.
Anderson, Warren: Union Carbide
How could the CEO of such a large company feel a direct connection to something so remote from his own cares, his own life, that he could take responsibility for it? Indeed, how could someone so averse to oversight of his business all of a sudden be responsible for the disaster it creates? If this was politics, there’d be reparations. But not in business.The Atlantic article is a wonderfully written exposé on just how blindly calloused our foreign business dealings become when driven by incompetence.
Antioco, John: Blockbuster
I'm ready for my close-up, Mr. DeMille! Blockbuster didn't so much descend the staircase of irrelevancy as trip on its shoelaces, barrel down the steps and break its neck on a Netflix kiosk. The Internet was tough a tough adjustment for most of the home entertainment industry but, boy, was John Antioco unprepared. Throughout the early 2000's, Antioco and his board rejected offers from Reed Hastings to buy Netflix "multiple times," at one point even "laughing him out" of the room. Whoops! A sympathetic soul may be inclined to apologize for Blockbusters brain trust and implore us to not define their careers by a single screw-up, and maybe they'd be entitled to that opinion--if in 2008 the board hadn't shopped a $1 billion buyout of...Circuit City?? Read the room, fellas.
Arnall, Roland: Ameriquest
"Don't judge to quickly--we won't." Pretty fitting motto for a company that was a pioneer not only of subprime mortgage loans, but subprime mortgage loans that don't even require a verification of employment. They're not just cautious with judgment--they're judgment free! How pious. Funny commercials though:
Many people, even his fiercest critics, had "trouble" reconciling his personal character and philanthropy with the lending practices Arnall blamed on "rogue agents." Do you buy that? Could such a charitable person also be a sludgy, predatory loan shark? Let's check the 2007 tax returns of the Roland and Dawn Arnall Foundation, a 501(c)(3) organization. What philanthropic non-profit uses a measly $2.07 million of its $37 million in total assets for charitable activities, and then lists "N/A" when asked to list said charitable activities? Maybe I'm reading this wrong, but sounds like someone who knows their way around financial loopholes well enough to cause a worldwide financial crisis--someone who might not care very much, either.