In my experience, large corporations and large bureaucracies are incapable of this act:
Rather than slash jobs, FedEx Corp. announced Thursday it would institute a hiring freeze and cut salaries, including that of CEO Fred Smith.
Beginning in 2009, Smith will scale back his salary by 20 percent. Other senior executives will receive a 7.5-10 percent salary cut. U.S. salaried employees will receive a 5 percent cut.
The cuts will help FedEx save more than $200 million in the remainder of fiscal year 2009 and $600 million more in fiscal 2010, helping offset what the company projects as “weak demand” for the upcoming year. The shipping giant did add a caveat to Thursday’s announcement: Each of FedEx’s operating companies “is evaluating other measures should business conditions further deteriorate,” according to a company release.
Its getting rough out there. I was at the mall this past evening doing a bit of Christmas shopping – and on the last Friday before Christmas, I had no trouble finding a good parking spot…and in the mall I wasn’t overwhelmed with crowds of people. Walking through the mall I saw several shops with “going out of business” signs, and driving through the city I see large numbers of empty storefronts. Economists will say this and that and the economic statistics will say such and such – but in my mind we’re in recession, and its a deep one, and may last long. I don’t expect any recovery at all in 2009, though I pray it will end soon. In such times, it is necessary that we all do our part – Fed Ex is doing so. Pity that Fed Ex seems unique among large corporations.
I work for a massive financial institution – we’re jacking up interest rates for trivial past due amounts, lowering credit lines and/or closing accounts at the drop of a hat and generally spreading the misery. It doesn’t have to be like this, and if the people who run the corporation would actually sit down and think for a bit, they’d realize that they are being perfect idiots. With losses in the billions, the answer was to lay off a hundred or so people – as if that would make up the difference. Burden customers, cut loose employees who have worked hard and loyally for years – such are the actions of people who just don’t know what they are doing.
Its hard to remain angry at the incompetence on display in senior management. One actually starts to pity them, after a while – they don’t know how the company they run grew, they don’t know how it works and they are in deathly fear of losing their jobs They jump from one trendy management nostrum to another, hoping to find the magic bullet which will spare them the next round of layoffs. If everyone would just settle down and understand that (a) we all have a vested interest in the success of the company, (b) in rough times the bank which helps out the customers will earn loyalty and (c) we’re all going to get a bit poorer over the next year, so don’t get nit-picky about who makes how much.
I don’t see much of this happening any time soon – the moral sclerosis which make a CEO figure that 30.99% APR is fair is the same sclerosis which prevents said CEO from just asking his troops what they think might work best. Blindness builds upon itself, and corporate and government America have blinded themselves to all reality. Time to get back to reality – and Fed Ex, in a small way, is showing where reality resides.
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