I picked the wrong profession

Perhaps the fall of HP's less than beloved CEO, Mark Hurd, best illustrates what is wrong with our current state of economy. When Mark stepped into the role of CEO a few years ago there was no doubt HP's approach to business was short sighted at best, the company relied solely on its ink and cartridge line for its sustainability. Mark changed HP's focus, creating a more well rounded, and as he saw it, more stream-lined company that fast became No. 1 in the personal computer market, and made its shareholders very happy.

Mark Hurd is being given near $43 MILLION to leave HP. This makes me wonder what knowledge about his fellow executives or the company itself this man has that would make HP pay him to keep quite rather than just firing him for conduct unbecoming. No wonder HP's stock has dropped; based on this decision, one would have to assume Mark has intimate knowledge of many of his fellow executives whose practices of blank checks and limited culpability mirrored many of his own. Not a very good perception.

But there in lies the problem. In today's business world, perceived company value (that is, the money on paper Wall street calculates as a company's actual value) drives the bottom dollar. Top level executives no longer worry solely about profitability and business ethics, their role is, now more than ever, one of perception. If a company is perceived as a good investment, more people will throw their money into it. For some strange reason though, many top level executives think that this money is to be siphoned off by them first in the form of huge salaries and bonuses. For whatever reason, be it greed, selfishness, egotism, status, or a need for a 5th beach house, these top executives believe that their role in creating a more profitable company means that they should reap the benefits of this profit, even if this profit came at the expense of many of those hard working subordinates who either, unfortunately, lost their job, or, slight less fortunately, were able to keep their job, but were now forced to work 60-70 hour weeks doing the work of two or three people.

When Mark took over, his style of management was one of streamlining: massive layoffs and reduced pay and benefits across the board, but only of middle to lower level managers and the everyday workers that make the company go. Nothing within the top level executives was touched, in fact, during his reign, they all continued to see salary increases and bonuses, especially as the company was turned around and became profitable once again.

I wonder when the business world is ever going to see its bottom line driven by genuine caring about fellow workers and common sense rather than self indulgence, nepotism and greed. Simply put, if we truly want our economy to recover, consumer confidence needs to return, as this leads to the movement of inventory which creates more jobs and a competitive marketplace. The only way to do this is to ensure that ALL individuals share in the payroll, that the bulk of all payroll is not tied up in the top 10% of a company's employees. If you were to redistribute half of the top 10%'s salary to the lower level workers, everyone could afford a slightly nicer house, a better car, soccer and dance lessons, more groceries and even more long term investing.

Hopefully we can learn from HP's fiasco; though looking at how we got here in the first place, and how very little has changed within the world of business, this is seemingly impossible. Who knows, maybe Mark will feel a little guilty and send each of the 14,500 employees he laid off a $2500 apology... This would still leave him well over $6 million dollars in buy out money.