The following story came to me this week from a reader who's sentiments may be shared by a lot folks. If I am the last one on the planet to have seen it and it has been circulating around the web for a long time, please excuse my redundancy.
The story pokes fun at business bureaucracy, mismanagement, corporate fairness, employee relations and more. Finding this type of story more often in your in-box displays a kind of recession fatigue and growing cynicism.
A foreign company and an American company decided to have a canoe race on the Missouri River. Both teams practiced long and hard to reach their peak performance before the race. On the big day, the foreign company won by a mile. The Americans, very discouraged and depressed, decided to investigate the reason for the crushing defeat. A management team made up of senior management was formed to investigate and recommend appropriate action.
Their conclusion was the foreign team had 8 people rowing and 1 person steering, while the American team had 8 people steering and 1 person rowing. Feeling a deeper study was in order, American management hired a consulting company and paid them a large amount of money for a second opinion. They advised that too many people were steering the boat while not enough people were rowing.
Not sure of how to utilize that information, but wanting to prevent another loss to the foreigners, the rowing team's management structure was totally reorganized to 4 steering supervisors, 3 area steering superintendents and 1 assistant superintendent steering manager. They also implemented a new performance system that would give the 1 person rowing the boat greater incentive to work harder. It was called the "Rowing Team Quality First Program," with meetings, dinners and free pens for the rower. There was discussion of getting new paddles, canoes and other equipment, extra vacation days for practices and bonuses.
The next year the foreign team won by two miles. Humiliated, the American management laid off the rower for poor performance, eliminated the rower's past entitlements, halted development of a new canoe, sold the paddles, canceled all capital investments for new equipment and closed canoe plants. The money saved was distributed to the Senior Executives as bonuses and the next year's racing team was out-sourced to India.
This story reminds me more of government everywhere than big business, except for the bonuses, which might be an understatement. Does this remind you of any company you know of, or management team? Are you working somewhere you think just does not get it? Seems this would be equally true in a socialist dominated economy.
Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money.
Walmart's New Health Food Push: Is It Too Hard to Swallow?
Bonds Are a 'Safe' Investment: A Big Lie Gets Even Bigger


Reader Comments (Page 1 of 1)
4-20-2008 @ 1:59PM
Allen said...
You are taking the story out of context. This wasn't about capitalism versus socialism or government bureaucracy. This was about how American corporate management has become so inefficient and detached from reality it cannot even see problems that are in plain site.
I've met with management teams like this before. General Motors reminds me of this. Those guys spend so little time actually amongst the customers, or even collecting data about them, that they pretty much only approve design projects for new cars AFTER all the current ones have failed. The mindset is that they must survey industry trends, collect customer data, then ignore it all in favor of their own ideas on how their cars should be.
Thats why GM still has problems years after the SUV craze went bust. People hated their interiors, their gas mileage, their service, and it never helped GM sales that they would make the same car across four different brands.
What did GM do? They only gave the new Malibu a decent interior (and then, only if you pay a lot for it), their still sticking four speed automatics in cars where everyone else is using smoother, more efficient six speed transmissions, their service still sucks and they still re badge everything. There is the Saturn Outlook, the GMC Acadia, the Buick Enclave and now Chevrolet gets its own version.
The only improvements were that GM gave the new Malibu a decent interior. Thats it. And only if you buy the most expensive version. But down where GM expects bread and butter sales, int he 4 cylinder, its still the same old same old.
But do not expect anyone on GM senior management to be fired. Do not expect any real product improvement over the next few years. Just expect more rebadging of models. Just expect more excuses and more "oh look, we did this." In related news, Chrysler is expected to keep spreading around that outdated platform from the (really old) Mercedes Benz E-class for the next decade.
Look at Japanese or European management though, and its vastly different. Mercedes will soon have its SECOND platform for the E-Class since abandoning the old one. BMW is launching its Efficient Dynamics program in all its cars. GM just releases it as a "mild hybrid" instead, and only on select few cars. When Lexus failed in Europe, Toyota fired people, hired new, young minds with ideas, and is going back to the drawing board.
And thats another problem with management in America: age. Your own bio, Mr. Liber, is a testament to that. You are a businessman who got into the mix back when the Soviet Union still existed. Just 3 more years, and the SU will have been dead for two decades. Where as I, a person still pursuing his degrees, easily laughed at that joke being about American management, you immediately took it and thought "Capitalism versus Communism, Socialism, blah blah blah."
Whats more, I see your response as typical of some failed management teams. Rather then figuring out what went wrong, most management just makes excuses. Your excuses were that "hey, some socialist governments are like that too." But that doesn't fix the problem that the management team in question wasn't working.
The problem with management today is the same problem we had 4 years ago before the bust. They are out of touch, out of their minds, and worse, rather than figure out what others are doing better, they make excuses by telling everyone who is doing worse.
The American economy, like any economy, relies on good management and sound decision making. The joke above was supposed to point that out. But when some people only point out that others are just as bad or worse, then those people might be the ones the joke was about in the first place.
4-20-2008 @ 2:39PM
kbriggs2 said...
Wow, Allen, your community college loans are hard at work here. Great job seeing exactly what was written. Mr. Liber's experience (more years than YOUR LIFE) was not vast enough to catch what your profound mind has deduced from your trips to the laundromat in your malibu... Oh wait- look at the second paragraph Sheldon wrote.
Your "degree chasing" mentality obviously saw through my sarcasm- everyone got the point of the story- help us out- only offer your opinion when you can put "CEO" in front of your name or someone asks you for it.
I am more aggravated after reading your post than I was when I lost 50% on crox. You win.
4-20-2008 @ 3:38PM
Allen said...
Seems you missed the point of my post as well. Kbriggs2. Worse you offer no substantial credentials to do anything yourself either. Can you put "CEO" in front of your name? No?
Also, I did see his second paragraph, you twit, but to finish a post like he did only deriding socialism or whatever not-capitalism ideology he could find, well, that is definitely missing the point.
And BTW, I'm attending Columbia, not a community college.
4-20-2008 @ 3:41PM
Allen said...
Also, at first I tried to ignore it but I can't be shamed like this. Kbriggs2 I do not drive a Malibu, I'd rather eat my own heart then a desert of my intestines before I ever sat in one. I drive a Mazda 3 hatch.
4-20-2008 @ 10:30PM
Mr. noitall said...
This story seems to describe the company I work for to a tee. Us rowers have learned to ignore the steerers instructions, so we don't keep going round in circles.
Allen, you seem like a pretty bright guy, I agree with your comments on G.M., but I think you were alittle too harsh with Sheldon. I didn't get any impression that the geezer was trying to compare capitalism with socialism or make excuses for the poor management decisions of U.S. companies. I think you're misinterpreting that last sentence the old timer wrote.
4-21-2008 @ 7:25AM
al coholic said...
Allen,
When I was your age I also knew the solutions to all world problems.
When you finally grow up you will come to realize that it is not necessary to broadcast your educational background. It exposes your ignorance of the real world, where we are judged not by our diplomas but rather by our performance.
Likely the jury is still out on yours. Grow up!