This Sunday, November 30th will mark the first anniversary of my retirement from EDS. In that time, the economy has tanked, we have elected a new president, the wars in Iraq and Afghanistan continue, and not to be forgotten, EDS has ceased to exist as an independent company.
EDS' fate was better than other corporations such as Bear Sterns or Lehman Brothers--at least it still exists as a division of HP. Similar to Citi, HP has announced massive layoffs at EDS, but those layoffs are smaller in absolute number and spread over a longer period of time. Timing is everything--who knows what would have happened to EDS if the acquisition was delayed by three months.
It is interesting to look at EDS from the outside, having shed some of the biased lenses that come with a job inside the company. While remaining a stockholder in HP, having no stock interest in EDS as an independent company also helps shed some bias.
Something is going to happen soon, based on activity by EDSers on LinkedIn. I have never seen the level of activity by all levels of the organization on LinkedIn representing either worry about their jobs, or dissatisfaction with their jobs. Employees are joining, making links, or expanding links, and joining groups at a rate I haven't seen in years. Whether employees think something is happening or something is really happening, it's hard to say.
With that said, EDS seems to have done well in the last year. It has significant challenges over the next 18-24 months, as do other companies in the IT marketspace. I believe that HP's CEO has the intelligence, perspective, and will to fully integrate EDS as a successful adjunct to HP's hardware offerings. However, it will be an interesting few quarters to see what happens. The transition will be complete when EDS' CEO leaves. My guess is that will occur in the next year.
Your thoughts?
Tuesday, November 25, 2008
Wednesday, November 19, 2008
Boomer Losers
Yesterday, CEOs of the big three automobile makers in the US made their pitch to Congress for an ADDITIONAL $25 billion bailout for their industry. Having already been authorized a $25 billion line of credit to "innovate" alternative energy cars, they are now asking the American taxpayer for an additional $25 billion that will buy them at most 6 additional months of cashflow. For example, GM stated that they are burning through $5 billion a month. They stand to get around $12 billion of a $25 billion handout. Therefore, a bailout would give GM anlittle less than 3 months additional time. Should Congress grant their wish? Congress is reluctant to do so.
These three CEOs demonstrated the dire straits of their respective organizations by the example of their behavior and that is why this bailout is a bad idea. First, while they will be forgoing their hefty bonuses, their salaries remain astronomical when compared to their well-payed rank-and-file. For example, the CEO of Ford makes some $28 million a year and he has taken that company to the brink of bankruptcy. Second, demonstrating that cost-cutting and sacrifice start at the top, all three CEOs flew to Washington on private corporate jets.
I agree that failure of the big three auto makers will be catastropic to the economy. Yet, it is investors who put a CEO in charge of Chrysler who, in his previous job, almost destroyed Home Depot while walking away with a $210 million golden parachute. It is the people talking to Congress that are the problem. It is the boards of these organizations who appoint and overpay these CEOs that are the problem. It is the investors who do not hold their boards accountable for gross mismanagement that are the problem.
Unfortunately, giving the people who are the problem more money is not the solution. There is a much better chance that real change will occur through a court-supervised bankruptcy than through legislated bailouts.
Investors wanted short-term profits at the cost of long-term survivability. Well, you got it and now you and the employees and suppliers and communities where these companies are located are all going to pay the price. As Dr. W. Edwards Deming once stated, "Survival is not mandatory."
Don't provide the bailout. Put that $25 billion toward paying the pensions of retirees who were guaranteed a pension when they worked at these companies. Congress let the companies underfund the pensions. Now Congress needs to make their mistake right, not dig a deeper hole. The Boomers are screwed either way.
These three CEOs demonstrated the dire straits of their respective organizations by the example of their behavior and that is why this bailout is a bad idea. First, while they will be forgoing their hefty bonuses, their salaries remain astronomical when compared to their well-payed rank-and-file. For example, the CEO of Ford makes some $28 million a year and he has taken that company to the brink of bankruptcy. Second, demonstrating that cost-cutting and sacrifice start at the top, all three CEOs flew to Washington on private corporate jets.
I agree that failure of the big three auto makers will be catastropic to the economy. Yet, it is investors who put a CEO in charge of Chrysler who, in his previous job, almost destroyed Home Depot while walking away with a $210 million golden parachute. It is the people talking to Congress that are the problem. It is the boards of these organizations who appoint and overpay these CEOs that are the problem. It is the investors who do not hold their boards accountable for gross mismanagement that are the problem.
Unfortunately, giving the people who are the problem more money is not the solution. There is a much better chance that real change will occur through a court-supervised bankruptcy than through legislated bailouts.
Investors wanted short-term profits at the cost of long-term survivability. Well, you got it and now you and the employees and suppliers and communities where these companies are located are all going to pay the price. As Dr. W. Edwards Deming once stated, "Survival is not mandatory."
Don't provide the bailout. Put that $25 billion toward paying the pensions of retirees who were guaranteed a pension when they worked at these companies. Congress let the companies underfund the pensions. Now Congress needs to make their mistake right, not dig a deeper hole. The Boomers are screwed either way.
Tuesday, November 11, 2008
Beware: Your Pension May Be In Trouble
I happened to see an AP news item that some 300 large corporations were sending a letter to Congress asking that certain portions of the Pension Protection Act of 2006 be delayed. These stipulations required that companies fully fund their pensions. However, with investments in funds plummeting on the stock market, many companies now find their pensions once again severely underfunded. Companies want more time to fully fund the pension plan.
However, these pension plans would not be underfunded had the companies invested in the pension instead of pointing that money into other business operations (or worse into obscene executive compensation). That is, the company management made a good short-term decision at the cost of a bad long-term decision. Now they want a no strings bye on the funding requirement. It amounts to another bailout, this time funded by your retirement pension, and enabled by your representatives in Congress.
Like the other bailouts passed by Congress or being considered, big business is basically extorting money from their employees. If they don't get relief on pension finding, they may have to lay-off employees or, in the worst case, declare bankruptcy. If the latter, the pension plan would be one of the first things to go meaning retirees would lose their pension. Even if the pension plan were to be taken over by the Pension Benefit Guarantee Corporation, the retiree would receive only pennies on the dollar of the benefit promised to them by the company. This also assumes that the Pension Benefit Guarantee Corporation does not go bankrupt--they are already out of money. The result would be a required bailout of the PBGC. Your taxpayer dollar at work.
I think there should be a cost for getting the full-funding delay--a shared sacrifice. First, executive pensions are typically in a separate plan from the rank-and-file employee. If management wants pension relief, they should be required to fold their pension plans into the employee plan. Their pension should also be at risk.
Second, any executive bonuses and raises should be eliminated until the pension is fully funded.
Third, sacrifice should start at the top. Therefore, corporate management should take an across-the-board pay cut of 40% until the pension is fully funded. This sacrifice could perhaps be higher, but 40% feels like a good painful number.
Fourth, golden parachute clauses in executive contracts should be recinded. Executives should get the same separation package as any other employee. If the executives don't like it, they are free to leave the company.
Fifth, executive perks should be eliminated. These perks are nothing more than compensation and should be the first to go in tight economic times. Indeed, this should have been done BEFORE asking for relief.
Sixth, in exchange for pension relief, the companies must stop all lobbying activities. That money should be directed at funding the pension plan.
Seventh, bankruptcy laws should be amended to require that a percentage of executive compensation, all bonuses, all golden parachutes, and all perks be directed to fully funding the pension plan. The pension plan should be the first debtor.
While these actions may seem drastic (especially to executives and management), there should be no free lunch. If relief is needed, there should be a high cost. The alternative is fund the pension plan.
I also think many of these actions should be stipulations for a Congressional bailout.
What are your thoughts? Agree? Disagree? Other suggested alternatives? Let me hear from you. Start a dialog with you Congressional representative to let them know how you feel.
However, these pension plans would not be underfunded had the companies invested in the pension instead of pointing that money into other business operations (or worse into obscene executive compensation). That is, the company management made a good short-term decision at the cost of a bad long-term decision. Now they want a no strings bye on the funding requirement. It amounts to another bailout, this time funded by your retirement pension, and enabled by your representatives in Congress.
Like the other bailouts passed by Congress or being considered, big business is basically extorting money from their employees. If they don't get relief on pension finding, they may have to lay-off employees or, in the worst case, declare bankruptcy. If the latter, the pension plan would be one of the first things to go meaning retirees would lose their pension. Even if the pension plan were to be taken over by the Pension Benefit Guarantee Corporation, the retiree would receive only pennies on the dollar of the benefit promised to them by the company. This also assumes that the Pension Benefit Guarantee Corporation does not go bankrupt--they are already out of money. The result would be a required bailout of the PBGC. Your taxpayer dollar at work.
I think there should be a cost for getting the full-funding delay--a shared sacrifice. First, executive pensions are typically in a separate plan from the rank-and-file employee. If management wants pension relief, they should be required to fold their pension plans into the employee plan. Their pension should also be at risk.
Second, any executive bonuses and raises should be eliminated until the pension is fully funded.
Third, sacrifice should start at the top. Therefore, corporate management should take an across-the-board pay cut of 40% until the pension is fully funded. This sacrifice could perhaps be higher, but 40% feels like a good painful number.
Fourth, golden parachute clauses in executive contracts should be recinded. Executives should get the same separation package as any other employee. If the executives don't like it, they are free to leave the company.
Fifth, executive perks should be eliminated. These perks are nothing more than compensation and should be the first to go in tight economic times. Indeed, this should have been done BEFORE asking for relief.
Sixth, in exchange for pension relief, the companies must stop all lobbying activities. That money should be directed at funding the pension plan.
Seventh, bankruptcy laws should be amended to require that a percentage of executive compensation, all bonuses, all golden parachutes, and all perks be directed to fully funding the pension plan. The pension plan should be the first debtor.
While these actions may seem drastic (especially to executives and management), there should be no free lunch. If relief is needed, there should be a high cost. The alternative is fund the pension plan.
I also think many of these actions should be stipulations for a Congressional bailout.
What are your thoughts? Agree? Disagree? Other suggested alternatives? Let me hear from you. Start a dialog with you Congressional representative to let them know how you feel.
A Calling
One of the things that I have found since retirement is that I like to write. Although I started before retirement, I now have four blogs that I publish: Peripheral Futurist, iPhone Perspectives, Boomer Matters, and Waxing Political. I love to write, but a thought that occurs to me often occurs when I am away from my computer. The result has been to take notes on my iPhone and then expand on them when I get to my laptop and I have the time. Unfortunately, the material I wanted to wrote about is dated by the time I get around to publishing it. Worse, the notes make little sense by the time I have time to write.
To address these issues, I have been researching an iPhone-based blogging application that would enable me to blog-on-the-go. I tried free ones--Sho-Zu (couldn't get it to publish); LifeCast (couldn't get it to publish); and BlogWriter Lite (can only publish to one blog).
After much research, I finally purchased iBlogger which is what I am using now. This is my first try at it and I am composing with the application while sitting in a Starbucks.
These type portable applications multiply the functionality and value of devices such as the iPhone and open up new avenues of possible revenue to the retiree. At a minimum, it provides an additional communication means.
Mobile Blogging from here.
To address these issues, I have been researching an iPhone-based blogging application that would enable me to blog-on-the-go. I tried free ones--Sho-Zu (couldn't get it to publish); LifeCast (couldn't get it to publish); and BlogWriter Lite (can only publish to one blog).
After much research, I finally purchased iBlogger which is what I am using now. This is my first try at it and I am composing with the application while sitting in a Starbucks.
These type portable applications multiply the functionality and value of devices such as the iPhone and open up new avenues of possible revenue to the retiree. At a minimum, it provides an additional communication means.
Mobile Blogging from here.
Monday, November 10, 2008
Boomer Jobs
This is probably the worst time for a Boomer to be looking for a job. In addition to the typical problems of age, job skill currency, and competition against two younger generations who can be hired for less, there is now the problem of trying to get a job in a down economic market. Some (like me) can get by on a retirement pension and possibly (also like me) working at part-time jobs that one is especially suited for. But what about the Boomer that must still work at a full-time job and that job is nowhere to be found?
I believe that the Boomer has a unique set of traits that is very saleable in the current market--knowledge. The typical Boomer, having worked for the last 38-44 years, has an accumulation of knowledge that would be difficult to reproduce by those workers much younger. While some of that knowledge may be obsolete, much of it--especially that related to understanding people, markets, behaviors, and the like--can only be gained by experience and long-term observation.
It is this knowledge, wisdom if you will, that makes older workers valued in the workplace and desired as consultants and trusted advisors.
What say you about this perspective?
I believe that the Boomer has a unique set of traits that is very saleable in the current market--knowledge. The typical Boomer, having worked for the last 38-44 years, has an accumulation of knowledge that would be difficult to reproduce by those workers much younger. While some of that knowledge may be obsolete, much of it--especially that related to understanding people, markets, behaviors, and the like--can only be gained by experience and long-term observation.
It is this knowledge, wisdom if you will, that makes older workers valued in the workplace and desired as consultants and trusted advisors.
What say you about this perspective?
Friday, November 7, 2008
The Post Boomer Generation
I suspect that this last election felt to the younger generations much as the election of JFK did to many Baby Boomers. Back then it was a passing of the torch from our grandparents to our parents. This time it is a passing of the torch from us to our children.
I feel bad that we have left them with an economy that is in shambles; a National Debt that is the highest in history; an armed forces that is spread way too thin with inadequate equipment and inadequate post service support; a failing educational system; a deteriorated infrastructure from roads to electric power; terrible air and water pollution; numerous species driven close to extinction; our landscape scarred from numerous strip-mining and oil shale extraction; an almost exhausted oil supply with no ready replacement; a decimated middle class; and sky-rocketing obesity and diabetes.
The good news is that religious fundamentalism is at a level not seen since the Salem witch trials; pornography is easier to obtain than it has ever been in history; the current president has made torture okay again; we now lock up people without the right to habius corpus; the FBI can wiretap you without a warrant; sales of assault rifles and guns are at an all-time high; the number of people without healthcare is at an all-time high; the number of people in poverty is at an all-time high; and we've managed to create a few new diseases such as HIV just to keep you on your toes.
Given the outstanding stewardship of the country while under our care, all we ask in return is that you provide us with a reasonable pension, comprehensive healthcare, adequate housing at at reasonable cost, plenty of parks to while away our time, and an infinite number of cable TV channels playing reruns of Dynasty and Magnim, PI.
No need to thank us. Really.
I feel bad that we have left them with an economy that is in shambles; a National Debt that is the highest in history; an armed forces that is spread way too thin with inadequate equipment and inadequate post service support; a failing educational system; a deteriorated infrastructure from roads to electric power; terrible air and water pollution; numerous species driven close to extinction; our landscape scarred from numerous strip-mining and oil shale extraction; an almost exhausted oil supply with no ready replacement; a decimated middle class; and sky-rocketing obesity and diabetes.
The good news is that religious fundamentalism is at a level not seen since the Salem witch trials; pornography is easier to obtain than it has ever been in history; the current president has made torture okay again; we now lock up people without the right to habius corpus; the FBI can wiretap you without a warrant; sales of assault rifles and guns are at an all-time high; the number of people without healthcare is at an all-time high; the number of people in poverty is at an all-time high; and we've managed to create a few new diseases such as HIV just to keep you on your toes.
Given the outstanding stewardship of the country while under our care, all we ask in return is that you provide us with a reasonable pension, comprehensive healthcare, adequate housing at at reasonable cost, plenty of parks to while away our time, and an infinite number of cable TV channels playing reruns of Dynasty and Magnim, PI.
No need to thank us. Really.
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