Maybe you're spot on 100% right in terms of vision, in terms of business plan, in terms of psychological blindspots, in terms of product market fit, in terms of a path to profitability. You seem pretty smart so maybe it is fairly insulting to you to not be listened to.
In what way is your world view helpful? And I want to be be gentle here, and not mean harm. In what way is it helpful for yourself, for your own wellbeing?
Let's say you could fix the company and stop the losses. Then trying to do that seems worth pursuing. Let's say you can't! We've all come across situations hard and unmoveable. So now, unless some break happens for you (because it's unlikely they will wake up and listen to you if they never did before...just a pragmatic observation), you are stuck being chronicly slightly unhappy.
It's not my place to suggest, and I'm trying to respectfully ask, would either maybe letting go or conversely doubling down and standing up for yourself and finding another job where they value you hurt you less? Completly serious question because everyone deserves to be happy.
And also, a bit of conjecture, but if you're not profitable it's that same CEOs ability to communicate a vision that's funding payroll right? I'm not saying absolve him of every misgrievance because if the company isn't doing well it's ultimately on his shoulders.
My point is maybe there's a softer path to walk here....?
I fully agree that, that would be the best remedy.
But how many CEO's have you talked with in your lifetime?
Every CEO I've ever talked with that has started a company or been there long enough to think of it as their "baby" have all had tough times letting go.
What I'm trying to drive at is whether there is any satisfactory way for a CEO in this position to "take responsibility for their actions" without raising your ire. What would they have to do? Then we can look at whether that's a reasonable thing to expect of someone in such a position.
My initial instinct is that this line of argument is more like venting than it is any kind of real suggestion for behavior change.
that's a very pessimistic view, and one that doesn't take into account the reality of being an executive or board member.
i'm a co-founder/executive of a small technology company. i have employees that used to be in my position when they were younger, but now they want to just do their jobs and go home.
in other words, they don't have intense, heated discussions about strategy, make firing and hiring decisions, make large spending decisions, discuss the financial bookkeeping side of the business, try to raise money from or sell to really unpleasant people, soothe angry customers and employees, because they don't want to. they don't want their work day interrupted by a bunch of anxiety-ridden executive half-conversations and rants with no real conclusions or answers.
almost none of their personal money is on the line, and very little of their potential income is on the line. they can go and find another 100k job tomorrow, they could possibly even make MORE money at their next job just by the dumb luck of losing their current one. did you ever think about that?
but... now here's the part you won't like: the reason you hold your opinion is because you want something more than what you have now. and that fundamental mis-alignment is going to cause you some level of frustration, because you think of yourself as a shot caller, when you aren't (or, more specifically, don't have to be). and when you're told what to do you get resentful, because you think you know better. well, maybe you do, maybe you don't. but you don't write the checks, and that's what a business is.
if you want to be involved at the upper levels, nothing is stopping you. you just need to either find that job, or create one for yourself.
stepping into conversations in which you have no context and no skin in the game is a real fast way to get yourself shunned because you have shared NONE of the downside but you walk in the door like you have all the answers. quite frankly, that's bullshit. and quite frankly, even if it isn't, you don't have any influence in that situation so it's irrelevant.
To preface my comment, I totally agree with your take away. Prioritize your own success above any other company, organization, or individuals success.
However, I can't help but feel you're painting with an overly broad brush. There absolutely are CEO's out there who would lie awake at night after laying people off a week before Christmas. Does that mean they wouldn't do it? No. They, like all of us, will ultimately make the decisions they need to make to succeed.
It may be comforting for you to imagine that everyone in a position of power over you is some evil super-villain devoid of empathy or emotion, but that isn't always the case. Things aren't that black and white.
Again I agree with your general sentiment. Be greedy and ruthless in your career. Don't make decisions that benefit your employer to your own detriment. Look out for yourself. 100%. I'm just not a fan of absolute statements like yours and wanted to add that businesses are ran by people too, and while some may be complete sociopaths, not all of them are.
I think at this point it might be too late as the boat has been rocked and by the sound of it, and OP response to another comment on this thread, I say it's tilting. If I was the CEO, and the person I hired and gave a very generous 50% comes to me with that kind of demand, I'd be realising I've made a mistake. It doesn't matter how good someone is. Everyone is replaceable, and sometimes one's perceived "incompetence" is only that - perceived. We have one side of a story and if I learned one thing from the internet is that every story is like a coin - with 3 sides.
Compare your straw man to a CEO, who’s responsible for 10,000 families being able to pay their bills and feed themselves. All you’re describing is being lower down a hierarchy, which naturally tends to come with poor stress management and high sensitivity to negative emotions.
You also seem to be quite ignorant to what a CEO does, and the stakes of the position. Failure for a CEO can end your career, regardless of whether you’ve already established yourself as entirely financially independent. It is also by definition the position of greatest responsibility in a company. There is nobody in a company that faces greater pressure to perform.
If you fail at your job, it’s really unlikely that your failure will be dissected in the news paper for everyone to see. You could get fired and go out and get a new job. For a disgraced CEO, this is usually not an option. We could all point out a couple of examples of revolving door CEOs, but for most executives, this isn’t a career path or even an option.
OK, maybe, just maybe, if you have a very small homogeneous team and all of you are hippies this could make sense. Outside of that scenario it has disaster written all over it. This is just being a lazy CEO and not wanting to make decisions.
Part of your job as a CEO is to understand such things the ebbs and flows of the business and ensure that it can survive even potentially deadly (financially speaking) scenarios.
Do people vote themselves a pay reduction during bad times? Good luck with that one.
Do all employees understand and plan for future acquisitions, investments and expenditures? Of course not. Sometimes you have to horde cash to get ready to make an investment, launch an initiative or hire more people. It is my experience that few people in a typical organization truly understand the financial dynamics of a business. People tend to see a two million dollar sale as two million dollars and not as the risk it can represent and the timeline to making a profit. Sometimes only the CEO has a true mental image of reality.
Here's an example out of my own life. True story.
I closed a $2.5 million dollar sale. This is for a hardware product. We are to be paid in four $625K installments, with the fourth one being against delivery. Walked away from the meeting with a PO and a $625K check.
Fantastic, right? No. I was actually very concerned. This was early 2009. The economy was in bad shape. Banks were not lending. Everyone was bleeding money in one way or another. Most people would see a $2.5M sale as a huge win. I saw it as a potential mine field. Of course I was happy to have won the business. The reality of a CEO is to have a larger mental map from which to operate. This larger mental map told me that, while this was a nice win any number of things could go wrong and hurt us.
Here's a reality in the electronics manufacturing business: Lead times can be horrible. It isn't unusual to have to wait twelve to twenty weeks for components. In addition to that, a lot of orders are tagged with the "NCNR" acronym: Non-Cancellable, Non-Returnable. In other words: You can't back away from an order.
What does this mean when you need to deliver $2.5 million in product in four months. Well, it means you have to write a huge pile of purchase orders as soon as possible. The profit margin on this sale, if everything went perfectly, was approximately 25%.
There are two ways to see this. The immature/adolescent way to see it is: "Man, you are going to make $625K!". Reality means "We have to spend $1.875 million to get this done. The latter is where the minefield lives.
Employees are not in tune with these realities. They want a reliable paycheck every week and they want security. And, yes, they want to make as much money as possible. None of this is meant to be pejorative, it's just a reality.
So, what happened? Well, within a week of receiving that first $625K I find myself writing nearly $1.5 million dollars in purchase orders. I had to. If I did not pull the trigger right away we could not deliver on time. Most of the PO's were for NCNR items.
The next twelve months would send me to the hospital at least once from the stress I had to endure. The bank that was financing this deal for my customer decided to pull back. Our second installment didn't arrive for several months. When it did, it bounced. In the meantime the warehouse was filling-up with components we had to pay for. I had to use a combination of all of my credit cards as well as the full available equity in my home to pay salaries, bills and keep the business afloat. I did not fire anyone.
It was a nightmare of unthinkable proportions. The proverbial kiss of death. At least one person actually died as a result of this business transaction. No, not in my company. The CEO of an associated company had a massive stroke and heart attack. The stress was just too much for him to handle and he could not take a break to look after his health. Sad.
The story is far more complex than the short version above and far more nuanced, don't try to dissect it because you don't have enough information. I am simply using a simplified version as an example of business reality. It's a contact sport and sometimes you get bloody.
During this time most of my employees were not aware of the mess I was juggling. Why not? Are you kidding me? The easiest way to destroy a company is from within. People want sausage, they don't want to see it made. Most employees at a multidisciplinary business don't have enough information to understand what's going on. You'd have to spend a ridiculous amount of time educating everyone in order to ensure that they get it. That's an irresponsible misuse of time. Your testing technician needs to be in the shop testing boards, not looking over balance sheets. Same applies to your shipping clerks, receptionist, marketing manager and graphic designer.
So, yeah, I am coming off a bit harsh on this one. And rightly so. I think this CEO isn't a CEO at all. He wants to be buddies with his presumably homogeneous team. This decision is bad on many fronts. It sets up a bad situation. You will have to veto or flat-out take this "right" away at some point and, when you do, it will be hell.
The other item is this idea of the CEO choosing to get paid the same or less than everyone else. OK, well, five buddies start a business together, fine, that makes sense. In most other situations this makes no sense whatsoever. Most businesses outside the reality distortion field that is the SCV/Venture-Capital world are self-funded efforts with huge financial and time investments from the CEO/Owner. A lot of them require slaving away in your garage for years before you can scale. There is almost no way any employee can match the level of investment, effort or sacrifice this class of CEO put into the business before the first employee was hired. No way. CEO pay and employee pay have no correlation whatsoever. One is responsible for a very narrow domain. The other is responsible for everything, often at a personal level.
Pay your employees fairly, treat them well, be generous about vacations, be considerate, help them if they run into tough times (sick kid, parent, financial problem, etc.), pay for conferences and training courses, take them out on morale building trips and, if finances allow, be generous with bonuses and your recognition of their contribution to the enterprise. You are running a business, not a hippie commune.
Exactly. My main problem is that the CEO's stance is entirely hypocritical, because he would demand real equity or quit (probably even faster) if he was in the employee's position.
Once you have access to millions in funding its tough to see people who have to work for a living as human just like you. You expect them to lovingly accept terms that you would be insulted at.
Now if your talent is so great that you dwarf all your employees it might be justified. But when you are pained at losing productive workers chances are your favorable terms exist mostly because of your connections.
Well, the truth is there is very little you or any manager (other exec) can do to change the situation. In general, this will only change through failures getting the attention of the investors and/or board who can effect change in the CEO. If the CEO is as egotistical as you say there is no way the CEO will take advice from anyone about getting mentoring and changing their behavior. Of course, if the CEO has enough failures and starts seeing the errs of the current ways (best case), then it is still possible it gets fixed.
I have seen this when I was a consultant for many companies and startups. The common trend is the companies would work for some period of time because of the good people around the CEO making it work. The reality is all that does is delay the CEO's failure and makes them think they are doing it right. Eventually though, people leave, new people come in and the amount of time they spend trying to fix things gets less and less to the point the company can't tread water and the cracks begin to get too big to stick a finger in.
BTW -- I've seen this with good CEO's too who were too passive. Typically there would be an exec or manager that was destroying the business and the CEO was too hands off/passive, so it isn't just a CEO that can cause this kind of damage.
My 2 cents, find a new place to work as there is little you can do to change the situation in the role you have. If you want to try and help fix it, find a high visibility project or issue to recommend/bring in a skilled & respected consultant who has direct interaction with the CEO, board or investor(s). It may still blow up, but the consultant can say things and push in ways employees can't, and if they have interaction with the board or a relationship with an investor they can backchannel pressure in ways you could never do (easily/safely) as an employee.
If you are a CEO, and you are unable to convince your board that you are correct, then the proper thing to do is resign, for you have failed to do your job. The main job of a CEO is to be leader, and part of the job of a leader is to sell people your vision. And if you can't sell the vision to the people who cut your paycheck, well, either you aren't good at your job, or the people in that position are incompatible with you, and given that the board outranks the CEO, that means you should go.
I have brought additional value to a company and had them just tell me no. No they were not going to give me a raise. I had to jump ship to get a raise. You're stance is nice from an ideal CEO perspective but it never works.
I don't know Riccitiello but honeslty I've done this myself (not a CEO). Bascially I beleive I (we) can do something and stated so and within 2 weeks my info / situation changed and I we can no longer do that something.
To put it another way, the CEO or founder is often the most optimistic person. Imagine a single founder, they want to believe they'll pull through, get that funding, find the customers, whatever it is that keeps things going up. People will claim a CEO has to be different but I personally think it's human nature for most people to hope/wish/desire/see the best outcome.
Unless there is some smoking gun email that says "I'm going to tell them we'll be fine but actually I'm going to layoff a bunch in 2 weeks", my gut says the CEO beleived what he said when he said it.
The CEOs are protecting the reputations of the people under them at the expense of their own.
They could blame the people who got laid off for not "correctly" implementing the vision. Future employers would potentially not look favorably upon them.
They could blame the market, which just makes the company as a whole look worse as they likely learned nothing if that were the case, and would still potentially reflect poorly upon the people let go.
Instead, the CEO is saying "I made a decision, but it didn't bear out, and for the company to be healthy again we need to make some drastic changes. These people aren't at fault"
Does that mean the CEO needs to resign? Maybe, maybe not. Was the decision obviously bad at the time, or only wrong in hindsight? Would a different CEO be better or worse give the company's current circumstances?
Yeah the point of this entire thread is that your (not unique to you, but you are certainly one of the CEOs that are easiest to vilify when discussing this phenomenon) incentives are so skewed that a given employee should be very cautious about joining your company.
You made a bet on e-commerce penetration. The reason it was so easy for you to make that bet is because if you were correct, you’d be even more fabulously wealthy. If you were wrong (like you were), you could simply lay off the employees you hired and tuck the severance package into one quarter of extraordinary charges.
The employee view of that is that if you were right, they’d be somewhat wealthy and if you were wrong (which you were) their lives would be completely upended.
That’s all. It’s just an attempt to remind people that even CEOs who have good intentions (and author layoff memos in a cerebral tone without the help of PR) can still cause absolute havoc in their lives because of the asymmetry of the power dynamic.
Did we read the same article? I didn't interpret it as a pity-party at all. I haven't been a CEO, but I have been in upper management, and that has been stressful enough for me to know that being a CEO is the last thing I could do.
I just thought this post was an honest discussion of one person's emotions, and I didn't feel that it was too strong one way on the positives or the negatives. If anything I found it helpful putting into context some of my own emotions that I have in leadership positions.
I was at a company once where I had a direct line to the CEO, we would meet 1-1 a few times a year, and he consistently encouraged me to "push from the bottom" for change.
Between the CEO and I were an incompetent manager, a very incompetent director, and a very sharp President who preferred the status quo.
In hindsight, that the CEO was encouraging me to basically undermine my manager showed a chaotic and unspoken power dynamic that I wasn't mature enough at the time to understand. What followed was a frustrating 2 years of trying to show a manager who was being managed by his team that our tiny 80 person company wasn't Google scale, didn't need to be Google scale, and that we were wasting 75% of our development efforts gold plating everything for no reason.
What I should have done, almost immediately, was either shut up and collected a paycheck or moved on to brighter and better things (which is what I eventually did).
The org chart is the org chart. You can communicate information upwards, but you can't communicate action upwards.
Maybe you're spot on 100% right in terms of vision, in terms of business plan, in terms of psychological blindspots, in terms of product market fit, in terms of a path to profitability. You seem pretty smart so maybe it is fairly insulting to you to not be listened to.
In what way is your world view helpful? And I want to be be gentle here, and not mean harm. In what way is it helpful for yourself, for your own wellbeing?
Let's say you could fix the company and stop the losses. Then trying to do that seems worth pursuing. Let's say you can't! We've all come across situations hard and unmoveable. So now, unless some break happens for you (because it's unlikely they will wake up and listen to you if they never did before...just a pragmatic observation), you are stuck being chronicly slightly unhappy.
It's not my place to suggest, and I'm trying to respectfully ask, would either maybe letting go or conversely doubling down and standing up for yourself and finding another job where they value you hurt you less? Completly serious question because everyone deserves to be happy.
And also, a bit of conjecture, but if you're not profitable it's that same CEOs ability to communicate a vision that's funding payroll right? I'm not saying absolve him of every misgrievance because if the company isn't doing well it's ultimately on his shoulders.
My point is maybe there's a softer path to walk here....?
Not my place to ask though.
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